Logistics associations around the world are becoming increasingly vocal in their support for the widespread adoption of telematics technology to cut costs, improve safety and reduce under- utilisation of vehicles.
The Australian Logistics Council (ALC) has called for the mandatory introduction of telematics, which the organisation believes can go a long way to aid heavy vehicle safety, as reported in Prime Mover. The ALC, in a recent statement submitted to The New South Wales Parliament’s Joint Standing Committee on Road Safety, released a blueprint to embrace this technological solution for the trucking industry.
In Europe, telematics is starting to play a major role in improving road utilisation, which in Europe’s increasingly congested road network is becoming highly prized by logistics enterprises. Telematics can harness real-time, remote monitoring and control of vehicles as well as driver performance, and has a variety of practical applications, including vehicle tracking, trailer tracking, container tracking, and fleet management.
One of the biggest issues for fleet management in many jurisdictions across the world is that traffic is growing faster than authorities can build road space. Last year, Forward with Toll covered many of the transportation issues facing fleet operators due to traffic gridlock and bottlenecks, in a ‘Congestion Charging’ series.
Professor Dr Alan McKinnon, professor of logistics at the Kühne Logistics University in Hamburg, told Forward with Toll, “In most countries, traffic growth has been outpacing the expansion of road space for many years, and this is likely to continue. There is also evidence that expanding infrastructural capacity generates additional traffic, making it difficult to build your way out of congestion.”
Hold-ups and snarling traffic jams have huge knock-on effects on the freight transportation sector. By lengthening transit times, congestion unquestionably inflates transport costs, McKinnon stressed. Managers prefer regular and predictable transit times, as they can accommodate this regularity in delivery schedules, thereby minimising its wider impact on logistics operations, he added.
McKinnon then warned, “As networks get closer to working at full capacity, there is a greater risk of accidents, extreme weather and roadworks causing gridlock and sending ripple effects across supply chains.”
According to a recent article in the UK’s Financial Times, under-utilisation in the European trucking sector is a huge challenge for the road freight sector. McKinnon stressed that operating trucks at full capacity is not always achievable.
“There are many perfectly good reasons for trucks not running full on every trip they make. For example, directional imbalances in traffic flow make it hard to find backloads for returning empty vehicles,” he insisted.
Indeed, as in many dilemmas facing businesses, there is a trade-off involved in decision-making processes.
“Companies also quite rationally trade-off lower vehicle utilisation for less inventory, higher customer service and more efficient goods handling. This is not to deny, however, that average vehicle load factors can be improved through, among other things, more careful planning, supply chain collaboration and greater use of online freight exchanges,” outlined McKinnon.
Telematics has a significant role to play in improving vehicle fill and the under-utilisation of vehicles, according to McKinnon. He recently told the Financial Times that under-utilisation costs the European road freight sector hundreds of billions of euros a year.
He added, “It can create real-time visibility of capacity utilisation across a truck fleet and highlight opportunities for backloading and load sharing. This applies within a single fleet, but more effectively at a multi-fleet level where companies are willing to pool their data.”
There is no doubt that telematics solutions are becoming increasingly popular with fleet managers across the world, especially in the freight sectors of the so-called developed countries, revealed McKinnon. According to sources quoted in the Financial Times, telematics providers are trying to add value by expanding the range of services, such as notifying managers about fuel levels, providing information on security checks and upcoming tolls, in addition to locational details and driver performance.
“The main challenge is to achieve similar levels of market penetration in the developing world. Here trucking companies, in many cases owner drivers, lack the resources to invest in telematics and, as the rate of vehicle replacement is low, upgrading to newer trucks with built-in telematic systems is slow,” McKinnon suggested.
McKinnon added an optimistic note when referring to its wider take-up, “The declining real cost of telematics and its ‘mobilisation’ through the use of smartphone apps is encouraging its spread across the truck fleets of low-income countries.”