“Technology is Both The Challenge And Opportunity” for Fleets

What should fleet organizations be focusing on in 2020?

Fleets in every industry are experiencing rapid technology growth and high adoption rates of fleet management solutions—even in the government sector, where implementation of new technologies tends to lag. This rapid rate of change and technological innovation is both a challenge and an opportunity for fleets in 2020. Specifically, fleet organizations will be asked to contend with:

• Rising costs
• New safety and risk management challenges
• Unique safety challenges in individual sectors
• Effective use of data
• Brand new generation of workforce

"There has been a significant amount of change in the last five years, but the amount of change that we’re dealing with is faster and more impressive than it ever has been before," says Maria Neve, who has over two decades of experience in consulting for fleet management in various capacities, with a focus on government fleets. Verizon Connect spoke with Neve about what she thinks 2020 will hold for fleets and how technology will play a role in helping these organizations address the year’s most pressing issues.

Managing rising fleet costs in an unstable environment

Today’s market is changing rapidly, and government fleet managers must grapple with adhering to strict budgets amidst unpredictable costs created by tariffs on steel, aluminum and foreign vehicle imports.

According to Neve, "If these tariffs are fully implemented and Congress doesn't figure out a way to ameliorate that problem and make all parties happy, we could see a significant increase in just the acquisition costs of the vehicle which will, of course, trickle down to everything else."

Other cost-contributing factors in this unstable environment include:

• Upfitting: It's not just the cost of new vehicles; the cost of upfitting existing vehicles will grow as well. "I have one client this year that was putting together specs for a dump truck and salt spreader and saw a $7,500 increase over last year on just the upfit because of the tariffs on steel and aluminum," Neve says.
• Budgeting: The unpredictable nature of the tariffs also makes it more difficult to budget and harder to carefully adhere to a given budget. In turn, this also impacts the vehicle replacement cycle, prohibiting agencies from replacing vehicles as often as necessary.

How the FCC could complicate safety and risk management

Another challenge that fleet vehicle managers must watch is the Federal Communication Committee's (FCC) determination to split apart the 5.9 gigahertz safety spectrum and parcel it out to cover additional non-transportation issues. This spectrum covers “vehicle to everything technologies,” which is how the vehicle communicates to infrastructure, a cell phone or another vehicle.

For example, imagine this: You’re turning left onto a street where you don’t have full visibility of the crosswalk, but a vehicle on that street detects a pedestrian you can’t see and communicates with your car so you can avoid an accident. "That communication is what that safety spectrum is designed to protect,” Neve says.

The FCC is seeking to open up the spectrum to alleviate the growing demand for Wi-Fi, thereby shrinking its safety applications. However, the Department of Transportation and NHTSA oppose opening up the spectrum, which could compromise connected vehicle infrastructure.

With more connected and autonomous vehicles on the horizon, this decision could have a major impact on the fleet management industry, particularly with consideration to risk management. Fleet managers are responsible for risk management, amongst a host of other things, and Neve stresses that it’s important to advocate for the tools that work in favor of risk avoidance and not just mitigation.

Unique safety challenges in the education sector

In addition to mitigating operational efficiency issues—such as improving vehicle optimization to account for non-school months—schools and universities face specific safety issues.

“From a safety standpoint, education fleet managers at schools and universities must answer the question: who's allowed to drive these vehicles," Neve says.

At times, these drivers will be employees of the school or university, who are covered by a liability policy. But, what if drivers are student workers? This presents new and different challenges: do students have a proper driver’s license, do they need a motor vehicle record check? From a safety and risk management perspective, these are important details.

“Safety and risk management becomes an even greater concern for primary education—elementary, middle and high schools—where children are being transported. You always want to make sure you have the safest, most up-to-date, best maintained vehicles in your fleet; but that is an extra special concern when transporting someone’s children,” Neve explains.

Managing a new wave of data

“The avalanche of data that can hit a fleet manager these days, I'd almost call it a tsunami of data because it is almost impossible to parse that data without having methodologies, business partners, and practices to deal with it,” says Neve. The data that is being collected needs to be managed properly in order to adhere to new, changing and complex data privacy regulations.

The ELD mandate is an example of a new source of data that’s testing how ready fleet organizations are to manage and mine data. “For business owners, I think that data will be used to form business use cases and planning scenarios. It’s very valuable for them because they can use it for more effective route planning, to more effectively plan and schedule drivers and more effectively look after the maintenance and upkeep of trucks and trailers,” says Neve.

A new generation of workforce

Neve notes that "brain drain" is another factor impacting fleet organizations, specifically with regard to the fleet management workforce. “A lot of folks that are knowledgeable in fleet management are coming to the middle or the end of their careers and, of course, everyone is being asked to do more with less.”

There’s a new generation of workforce entering the industry, and these workers are not necessarily one hundred percent devoted to fleet management. That can make it difficult for an employee to be truly immersed in the industry and to learn what they need to learn to effectively manage a fleet.

"That’s when it becomes even more important for a fleet manager, whether they’re full time or part time with other duties on their plate, to select the proper partners to help them do their job as effectively as possible," Neve says.

“What I think is an opportunity is the influx of new folks in to the fleet industry,” she notes. “While individuals are retiring, and you're going to be losing some institutional knowledge, I think that the influx of new blood in the fleet is also a very good thing. It brings a different perspective and thought processes as we move to the next generation.”

Technology is at the forefront of addressing these challenges

Even though there is much to contend with for government fleets in coming years, according to Neve, “Technology is at the forefront of addressing these challenges. GPS technology as a whole can help reduce a significant amount of spend for a fleet.”

Fleet management and budgeting in a government setting is a complex process that involves many variables and a constant balancing of objectives. Government fleet departments have the responsibility to ensure that all assets are working efficiently, and that over-spending is prevented. That’s why more and more government agencies are turning to telematics as an effective solution to help manage their fleets within limited budgets.

GPS tracking technology can help reduce fuel and maintenance spend by tracking vehicle actions like idling, hard stops and speeding. This can allow managers to better train drivers to help increase safety and reduce liability costs. According to Neve, “It’s really a great risk mitigation tool that can be used to reduce fuel spend, maintenance spend and avoidable accident spend.”

This technology can also assist in improving dispatch, routing and visibility, allowing managers to more effectively plan and schedule drivers and create more efficient routes for vehicles. This visibility can also be shared with customers and constituents, allowing them to see exactly where their packages are in last-mile delivery. It can also provide citizens with vital information from government fleets, such as the location of snow plows during winter weather.

“Major cities are using the telematics on their snowplows and putting that information on the city's website so that individual citizens can see that the snow plow is only two streets over or when a street was plowed—even if it snowed all day and it’s unfortunately covered again,” Neve says.

Without careful consideration, technology adoption can hit snags

Despite high levels of adoption in the private industry, GPS tracking has encountered some obstacles with unions in the government sector, often because it hasn’t been included in their collective bargaining agreements and warrants open discussion around implementation.

New technology must be considered carefully—not to delay its implementation but to ensure it is being fully considered. Then, managers can truly see the value of fully utilizing the data created by new technologies to reduce cost and improve fleet stewardship.

Click here for more information about the implementation process, and to learn more about how your fleet can benefit from GPS tracking technology.

As a fleet expert, Maria wears many hats. As the director for NAFA’s government affairs committee, Maria F. Neve works with the US legislative counsel in advancing NAFA and fleet management's interests as a whole. She also serves as a manager at Mercury Associates, Inc., which is a fleet consulting and services firm that provides independent technical assistance and advice to public and private organizations. Neve recently shared her expertise with fleet professionals at Connected Fleet USA, a yearly event that brings together the trucking industry for knowledge exchange.