What is Telematics?

Key Takeaways

Telematics is the technology used to monitor a wide range of information relating to an individual vehicle or an entire fleet. Telematics systems gather data including vehicle location, driver behaviour, engine diagnostics and vehicle activity, and visualize this data on software platforms that help fleet operators manage their resources.

How telematics works

Fleet telematics gathers a range of data using Global Positioning System (GPS) technology, sensors and vehicle engine data to provide fleet operators with the information they need to manage their fleet.

Global Positioning System (GPS) technology - powers live visibility into vehicle location, speed and movement within points of interest through geofencing.
Sensors - enable the capture of data on driver activity, including aggressive acceleration, harsh braking and erratic cornering, but sensors can be used to monitor any in-vehicle activity such as a door opening, tail lift raising and even trailer temperature.
Engine diagnostics - these solutions pull data directly from the in vehicle diagnostics system and are primarily used to gather real time data on fuel efficiency and vehicle odometer readings that help power digital fleet maintenance solutions.

The data is temporarily stored in a telematics device that in installed in each vehicle, and is then transmitted over private cellular networks to secure servers. It is this central data hub that enables fleet management software to provide easy-to-understand visualisations that help fleet managers optimise their operation.

Telematics; past, present and future

Telematics technology developed out of the rapid expansion of the internet from the mid-1990s onwards. The greater availability and practicality of telecommunications technologies that arose in tandem with this expansion also produced new forms of remote communication. Over the years, these developed into what we know recognise as modern telematics systems, and these have been particularly widely adopted over the last decade.

Fleet management programs now enable firms to manage fleets of all sizes – from a handful of vehicles to hundreds – and help deliver major improvements across the board. Telematics has now developed to the point where it goes well beyond mere dot-on-a-map tracking to incorporate vehicle and driver performance as well as maintenance management.

The growth of telematics technology continues apace. Although the adoption of telematics has already become standard across various industries, the technology itself continues to evolve, and to grow in power and capacities, all the time. The burgeoning driver shortage affecting the transport sector and the continuing challenge of regulatory compliance are likely to have a major bearing on the future of telematics.

Internet of Things

Telematics is also proving crucial in what has become known as the Internet of Things that Move (IoTtM); specifically, in transport and freight. These sectors have been leading adopters of IoT technology, with the data it provides allowing for more efficient routing and scheduling as well as generally better-optimised use of resources. The IoTtM thus encompasses, for example, location tracking and driver and equipment operator monitoring, including engine and driver hours. The main benefits of this include:

Reduced fuel costs - with fuel consumption being one of the most pressing costs facing fleets, detecting and reducing excessive fuel use is absolutely crucial to overall efficiency. Telematics does this through more direct route planning, reducing job site bottlenecks and cutting engine idling, while also detecting unauthorised vehicle or equipment use (enabling firms to cut down on resulting fuel usage).
More cost-effective maintenance - telematics warns managers of mechanical issues with vehicles and equipment, which allows them to address these problems sooner and thereby reduce the danger of downtime (which is not only inconvenient but can also have serious knock-on effects for other jobs). It also makes scheduling preventative maintenance simpler, which again helps to maximise vehicle and equipment uptime.
Better communication - previously, keeping in touch with drivers and operators out in the field could be a complex business. Telematics simplifies communication processes and significantly reduces the need for human operators and drivers to check in and report back, automating much of this process. As well as ensuring that managers have access to the data they need faster, this allows operators to spend more time concentrating directly on the job in hand.
Enhanced safety - another crucial consideration (and a central legal responsibility) for firms operating fleets of vehicles and equipment, safety is of paramount importance. Telematics improves safety management by monitoring both driver and operative behaviour, and vehicle and equipment performance.It allows anomalies – such as unsafe practices – to be detected and addressed quicker. It also allows for emergency assistance to be directed straight to the site where it is needed, through location tracking.

Telematics is also helping both industry and society adapt to the continuing challenges facing major towns and cities. The mounting pressure on urban infrastructure (particularly transport) requires industry to take innovative and imaginative measures; this has led to the rise of the so-called ‘smart city’. This means, in a nutshell, using data and technology to maximise efficiencies (from energy efficiency to traffic management) and thereby make urban environments more practical, sustainable, secure and liveable for all concerned.

Telematics devices and software

Most commonly, telematics data is collected by a small device installed in the vehicle (or other asset) itself. This collects stores and transmits different types of information relating to the vehicle’s performance, condition and usage. There are different types of telematics devices available that offer different functionality and benefits. The most accurate and secure telematics devices are hardwired, these devices offer tamper proof functionality and a wider range of connectivity to peripheral devices.

Telematics devices are often connected to other in-cab driver interfaces that enable drivers to receive jobs, capture proof of delivery and even get real-time feedback on their driving performance.

What telematics can do for your business

There are a number of areas where telematics systems can benefit businesses. Telematics systems do more than just keep fleet managers abreast of the location of vehicles. They greatly streamline communication, job despatch and routing, and also record and transmit information on whether individual vehicles are in motion or stationary, their engine performance (including power-up, shutdown, idling or malfunctions), vehicle speed, driver conduct and more besides. This benefits business in the following ways:

Improved service - through knowing the exact location of each vehicle in the fleet at any time, dispatchers can make constant routing adjustments responding to changes in the traffic, vehicle availability or weather conditions. In this way, they can switch resources around and ensure that deliveries reach customers when they need to. In addition, they are also able to keep clients informed as to their delivery’s estimated time of arrival, helping to increase customer satisfaction. For example, one firm – Starplan Furniture – cut fuel costs by 15% while increasing its customer satisfaction rating to 90% after introducing telematics.
Lower fuel and maintenance costs - through more efficient routing, the overall amount of kilometres travelled can be reduced, which reduces fuel consumption as well as carbon emission (and the fleet’s overall carbon footprint). As well as reducing wear and tear on vehicles, telematics can also provide warnings about mechanical problems and impending maintenance tasks. This all serves to cut the risk of breakdowns and consequent disruption.
Lower administrative costs - telematics also greatly simplifies compliance and administration, through digital tachograph data as well as automated mileage expense reports. The latter can be used to reduce the administrative burden in addition to supporting road user charging.
Improved safety - telematics can provide drivers with enhanced safety, for example via its location tracking allowing for quick emergency aid where it is needed. Telematics is more generally known to improve driver behaviour. In-cab feedback can alert drivers to dangerous conduct, and telematics data can also be used to develop individual driver training and development programmes. The results can be striking: one 900-vehicle fleet made remarkable improvements in safety after adopting telematics, including a 97% reduction in speeding and a 47% reduction in crashes as well as savings in both fuel spend and maintenance costs.

The difference between GPS tracking and telematics

GPS tracking is an essential and central component of a telematics system. As we’ve discussed, it allows fleet managers to keep track of their fleet assets at any given time, providing them with a comprehensive overview of what resources they have at their disposal. However, telematics cannot be reduced to a simple vehicle tracker – we have already highlighted that it has a vast array of capabilities other than this. It is because of this versatility that telematics has become so central to fleet management in recent years. Telematics devices capture data points including the following:

Vehicle location, speed, status (customisable)
Geographical point of interest (Geofencing)
Vehicle diagnostics (e.g. EPM, MPG, odometer) and incidents (harsh braking, acceleration and cornering)
Remote vehicle inspection reports
Job dispatch and messaging

In addition, telematics systems integrate vehicle routing and maintenance scheduling with driver performance, providing a comprehensive and broad-based solution to the key challenges facing fleet management. Thus, they go well above and beyond vehicle tracking alone.

Which vehicles can telematics be used for?

Telematics is a versatile technology, both in the number of functions it can perform and the range of different vehicles and other assets with which it can be used. It is suitable for use with the following vehicles and assets, among others:

Cars - as well as performing important productivity and vehicle maintenance functions for company car and sales fleets, telematics is also used to monitor private mileage and ensure health and safety compliance, an essential part of employers’ duty of care.
Cargo vans/pickup trucks - used for functions including job dispatch and routing, time on site reporting, time sheet reporting, proof of delivery solutions, monitoring unauthorised vehicle use and tracking driver behaviour.
Single axle/tractor units - here, telematics helps with route optimisation and scheduling, driver hour management, fuel management and driver behaviour reporting.
Buses and coaches - telematics provides assistance with driver hour management, route optimisation and scheduling, fuel management (including engine idling), integration of services (through, for example, time of arrival notifications) and driver behaviour reporting.
Heavy equipment - in the construction industry, telematics is used for heavy earth-moving equipment. Here it serves to boost job site productivity by tracking equipment utilisation, enabling preventative maintenance and reducing fuel burn.
Specialist vehicles - telematics is also widely used for a range of specialist vehicles, including dump trucks, tow trucks and cement trucks. Among other benefits, the technology provides a better understanding of vehicle activity through power take-off, where mechanical power is transferred to another piece of equipment (such as the cement mixer on a cement truck, for example).

It is this sheer versatility of telematics that has guaranteed it an instrumental (and expanding) role in fleet management for the long term. It is already delivering major improvements to safety, productivity and ultimately profitability, and it is only likely to become more central in the years ahead. Those businesses across the world that integrate telematics systems into their operations can expect to continue to reap significant rewards.