Commercial Vehicles

How Telematics Has Completely Revolutionized the Management of Fleet Vehicles

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This story appears in the October 2014 issue of Entrepreneur. Subscribe »

Telematics has revolutionized the management of fleet vehicles, reducing wear and tear and the amount of time it takes to roll up to a customer's door. A glance at UPS shows how they do it better than anyone, and how you can streamline the operation of your own company vehicles.

If you want to understand the importance of telematics tracking software, consider that it helped UPS--the world's largest private shipper and one of the largest fleet operators, with more than 100,000 vehicles logging 3 billion miles per year--cut its preventative maintenance schedule in half over the last five years.

That's right: UPS went from 240,000 preventative maintenance inspections per year to 120,000. What's especially impressive is that the company did this while increasing the reliability of its vehicles.

Director of automotive engineering Dale Spencer, who oversees the UPS fleet, explains that the company is atypical in that it owns the majority of its vehicles (as opposed to leasing them). It has more than 1,400 garages worldwide dedicated to maintaining every delivery truck or car.

For decades, UPS used the same maintenance schedule: changing the oil, fluids and brakes at prescribed intervals, no matter what. That changed with the introduction of sophisticated, proprietary tracking software, as well as advances in engine technology.

"In the past three to five years we've seen 50 percent better fuel efficiencies come to medium-duty trucks," Spencer says.

UPS has learned to trust the data--to monitor every truck remotely, from a high-temperature warning to signals as to whether a driver is wearing a seat belt. "We have the driver data; we know how fast they're driving, how hard they're stopping," Spencer says. "That driver will change bad habits before it costs us money."

The software also allows the company to spot wear trends. "We could see certain parts wearing out on the same vehicles too quickly," Spencer says. That enabled UPS to go back to the vehicle manufacturer and argue for a warranty claim because it was possible to document a pattern. Even a small-business owner with a 10-vehicle fleet might have such an advantage, he says, "as long as they had the data to prove it."

That said, you don't need a system as elaborate as UPS' to reap the rewards of tracking your fleet. Spencer claims that even off-the-shelf telematics software "will give you discipline on maintenance." Used right, you'll know about a problem in any vehicle before it's a crisis. And like UPS, you'll be able to keep your fleet on the road longer and get more miles out of it because repairs are done before a vehicle becomes seriously damaged.

Edition: December 2016

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