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Telematics, for costs optimisation in vehicle fleet

31 December 2016

ALD Automotive has been for the past 11 years one of the main operating lease promoters in Romania and, for many years, a close partner of One of the current trends, next to digitisation and electric cars, is represented by telematics and we have talked to Frédéric Banco, General Manager of ALD Automotive, in order to find out more about the opportunities that this type of services brings for the fleet managers.

Mr. Frédéric Banco, beyond the implicit advantages of the operational leasing, a company such as ALD Automotive aims for and proposes additional services, such as telematics, a concept that is still little-known and constantly under development. Please describe, in a few words, what is entailed by this concept, from the point of view of ALD Automotive and its customers.

One of the main objectives of ALD Automotive refers to providing customised services to our customers, corporate companies or SMEs, and this principle has evolved, over time, alongside the development of integrated solutions, of the digital and other kinds, that would provide the fleet managers and the users with an experience that is as pleasant and as effortless as possible in relation to our products. To this end, our company is, on the local market, one of the first promoters of the international concepts and trends to which our corporate customers, in particular, pay more and more attention and to which they are increasingly responsive. We are talking about the vehicle fleet “greening”, the improvement in the drivers’ safety by means of dedicated classes and events, complex digital platforms for fleet management and the TCO (total cost of ownership) optimisation, as well as White Label-type partnerships and dedicated consultancy services.

The telematics is truly one of the current international trends in the automotive and operational leasing industry, in particular. The technology represents a mix between telecommunications, namely the transmission of data from the vehicle integrated sensors and the information from the global positioning system (GPS), namely the time and location, which allow the fleet managers to monitor the performance of drivers, they behaviour in traffic and also the vehicles. In many European states we will find systems that were specifically designed and implemented for this purpose, while, in Romania, this trend has just emerged. The concept of telematics includes implications and advantages beyond the mere GPS monitoring of vehicles and routes taken, since such dedicated systems allow for the drawing of complex reports and decision-making for the optimisation and manner of use of the fleets. Therefore, fleet managers may identify immediate methods for the costs optimisation, by means of actions such as ensuring more effective routes or investing in defensive driving classes for drivers, or they may monitor and act in real time in the event of certain technical repairs performed for the vehicles. At the same time, the implementation of telematics systems must consider the fact that each fleet is different in terms of particularities and needs, just as the customers’ profiles are highly diverse. For this reason, it is useful for the fleet managers to aim at certain pre-set objectives when making the decision to implement a telematics system.

From the perspective of ALD Automotive, the major benefit of implementing a telematics solution is that it provides an integrated database that allows for making decisions in a much shorter time. The information that is thus collected may lead to complex analyses which, in the end, may decrease the TCO, for example, by optimising the costs allocated to fuel, thanks to the real reporting of consumption. Moreover, the monitoring of the vehicles and used routes leads to an increase in the drivers’ safety, to a stimulation in productivity, as well as an improvement in the relationship between the customers and their partners, due to the optimisation of the time spent on the road, in the case of commercial fleets. We wish for things to start taking shape in this direction, at local level as well, since it is obvious that telematics may lead to favourable changes for all involved stakeholders.

Which are the best understood and most often requested telematics services in Romania?

One of the most often encountered preconceived ideas on telematics is the one according to which the employers are controlling their employees. The correct perception should rather focus on the companies’ concern regarding the safety of each driver, since, as previously mentioned, such systems provide the fleet managers with access to data concerning the vehicle efficiency and operating condition, as well as the user’s behaviour in traffic. More precisely, the system signals and records sudden manoeuvres, such as speeding or braking, and, following the data analysis, the fleet manager may conclude whether these were unforeseeable circumstances or, rather, an aggressive driving style, which may ultimately be corrected by means of various measures taken by the company.

Therefore, with the help of telematics, the customers may gain access to a widely diverse range of data on the managed fleet. The added value of such data is proved by their integration and interpretation by the fleet managers that will thus be able to take informed and substantiated decisions, by means of which they will be able to generate additional benefits at organisation level – cost and route optimisation, decrease in the number of accidents.

How quickly is the Romanian market taking on the trends that have already been adopted by other markets? What are the international level developments towards which you foresee that the local customers will turn, in terms of telematics?

Based on the local experience, the Romanian market closely follows the international trends. ALD Automotive monitors the newest trends in order to be able to propose, to its customers, operational leasing services and products that best answer of their mobility needs. Moreover, the penetration rate of such trends is also set by the knowledge and understanding level of the benefits that may be provided to the own businesses and, to this end, the customers that are multinational companies were those to set the tone in Romania as well.

In making the decision to contract telematics services, we recommend that our customers set, first of all and as clearly as possible the objectives regarding the telematics and the impact that they foresee concerning the organisation. Certainly, the safety of the vehicle drivers and the optimisation of costs shall be two of the main directions that the local customers shall take into account when contracting telematics services.

Does telematics also means control of fuel costs?

Telematics is a management instrument which, by recording precise data regarding the users’ behaviour in traffic, will certainly bring added value to a company. The control regarding the fuel expenses is one of the main benefits that the telematics may generate, alongside an improved safety level for the drivers.

On one hand, the drivers may become more responsible, drive in a safer manner, slow down and, implicitly, cut down the number of accidents, which, as a whole, generates a cost reduction. On the other hand, by changing the users’ behaviour behind the wheel and by budgeting the fuel needs more accurately, the fuel costs are reduced, the efficiency increases and the vehicle wear level is diminished, an aspect which, for a company, could represent resource optimisation.

In conclusion, the vehicle drivers’ behaviour in traffic is among the main factors that would lead to a drop in the fuel costs, which, in their turn, hold an important weight in the TCO amount. Many studies have shown that the fuel efficiency improvement is directly related to encouraging the adjustment of driving styles, which eventually leads to the environment protection, as aspect to which ALD Automotive is directly connected by means of the dedicated actions that it initiated. At the same time, the telematics systems allow for monitoring the routes taken by the vehicles and, following the analyses, the fleet managers may optimise said routes on the grounds of criteria such as: involved time and costs, traffic intensity or road condition.

What is the role that ALD Automotive aims to fulfil on the Romanian telematics services market?

ALD Automotive has already foreseen this international trend on which we believe it is natural to focus, in Romania as well, in order to provide our customers with the possibility of fully benefitting from all the advantages provided by the operating lease services. At the present time, our portfolio also includes customers that are monitoring their vehicle fleets by means of telematics services and, from this perspective and the previous one, we wish to continue developing this segment. Moreover, our consultants play a very important part in explaining the concept and benefits that these services may bring to different customer profiles, since, as explained above, the objectives of the telematics services may be diverse, based on several factors: business size, field of activity, targeted indicators and so on.


The full version of this article can be read in printed edition of Magazine, issued in December 2016.

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