Adopting digital tools can help fleet managers improve efficiency, productivity and safety through real-time asset tracking, with increasingly sophisticated technologies enabling businesses to better leverage data analytics to optimise fleet operations.
Allied Market Research has projected the global fleet management sector will exceed US$50 billion in value by 2030, while Global Market Insights has estimated it will reach US$45 billion by 2027.
Fleet telematics services have evolved to keep up with market needs, beginning with GPS vehicle tracking and upgrading to safety and security, productivity and compliance, and driver and payment information, with future supply to reflect market demands around automation and electrification.
Benefits include more efficient fuel usage, a reduction in overall operating costs, fewer vehicular accidents (longer vehicle lifecycle), lower labour costs, greater asset tracking transparency, and improved supply chain resilience.
Safety is a key issue for the industry, as commercial fleets have higher incident rates than conventional drivers due to both longer distances driven and the higher likelihood of distracted driving during long trips.
Fleet management systems allow companies to measure and benchmark driver behaviour as well as providing quick and easy contact when any distress alerts are activated.
Data collection is critical to an effective fleet management system, as the more sufficient and accurate the data is, the more actionable insight will be available to fleet managers.
Traditional systems architecture of fleet telematics is comprised of data creation, transmission, analysis and presentation, with a vehicle generating up to 25 gigabytes of relevant functional data per hour.
Examples of the types of fleet data or metrics common across industry include fuel tracking, vehicle maintenance, purchasing and leasing, vehicle utilisation, driver licensing, and driver performance.
Advancements in telematics technologies now allow fleet managers to act more proactively, instead of reactively, to mechanical problems and maintenance.
In a survey of more than 300 Australian fleet managers overseeing corporate fleets of 20 or more vehicles, conducted by market research consultancy Fifth Quadrant, business efficiency was the top priority for 59 per cent of managers, a substantial increase from 42 per cent in 2022.
Ensuring compliance with regulatory requirements also saw a substantial increase, with 548 per cent of managers marking it as a high priority compared to 34 per cent two years ago.
Other high-ranking priorities – reflecting a broader trend towards operational excellence and safety – were reducing running costs (57 per cent, up from 42 per cent), enhancing driver safety (53 per cent, up from 35 per cent), and improving service delivery to end customers (52 per cent, up from 42 per cent).
The research showed managers were utilising data analytics and business intelligence tools to varying degrees – 20 per cent were beginners, using these tools for an average of 0.5 applications; 44 per cent were intermediate users; and 36 per cent were advanced users, leveraging the tools for an average of four applications.
It also showed how automation was increasingly being adopted, with 58 per cent being advanced users of software that automated fleet operations, and 31 per cent employing AI tools to automate common manual tasks.
However, the research noted that internal capabilities in data analytics and business intelligence showed a wide disparity.
The researchers said: “Advanced fleets rate highly in data integration, real-time analysis, predictive analytics, and user-friendly reporting, while beginners lag significantly.”
The main hurdles to using digital tools identified by fleet managers in the survey were lack of in-house expertise, organisational resistance to change, high implementation and maintenance costs, insufficient data quality, difficulty translating insights into strategies, and system integration issues.
Sustainability was also a growing focus, with fleet managers prioritising energy efficiency, reducing emissions, carbon footprints, and increasing the use of renewable resources.
The researchers added: “Advanced managers are significantly more engaged in sustainability initiatives, integrating sustainable practices into fleet maintenance and operations, upgrading to more fuel-efficient vehicles, optimising routes with telematics, and transitioning to electric vehicles.”
Corporate fleets comprise almost two-thirds of Australia’s commercial vehicles, but only make up less than 5 per cent of vehicle-owning businesses.
These corporate fleets include passenger, light, and heavy commercial vehicles, which creates complex operating environments requiring advanced technology solutions to stay ahead.
Small fleets with under 20 vehicles, on the other hand, make up 95 per cent of vehicle-owning businesses but operate only 1.5 million of Australia’s commercial vehicles.
Due to their size, smaller fleets usually work within a less structured operating environment, presenting fleet managers with unique challenges around cost and efficiency.
A global study of 1,800 fleet managers across 15 countries shed further light on the future landscape of fleet digitisation, with the findings showing managers planned to increase investment in digital fleet solutions and indicating significant planned adoption of artificial intelligence (AI) and electric vehicle technologies.
Jan-Maarten de Vries, President of Fleet Management Solutions at Bridgestone Mobility Solutions, which commissioned the study, said: “The move towards digital solutions, including
AI, is no surprise to us and a clear indication of where the future of fleet management is headed.”
“Our study reaffirms the critical role that digital fleet solutions play in increasing fleet efficiency, reducing costs, and enhancing driver and vehicle safety – it’s clear that investment in these technologies will only continue to grow.
“AI and electric vehicles are transformative technologies that will continue to enhance fleet management.”
The research found 91 per cent of fleet managers expected to increase their investment in digital fleet technologies over the next five years, while 52 per cent cited improvements in efficiency and reduced operational costs as the most compelling reason for investing in digital solutions.
About half (49 per cent) of fleet managers highlighted enhanced driver and vehicle safety as top reason to invest in fleet management technology, and nearly all respondents confirmed AI would have a significant impact on fleet management in the future.
Majorities of respondents expected AI to optimise route planning and logistics (62 per cent), improve driver safety (56 per cent), and enhance predictive maintenance and asset management (55 per cent).
Electric vehicles were also confirmed as the future for commercial fleets, with 85 per cent of fleet managers expecting the number of electric and hybrid vehicles in their fleets to expand in the coming five years.
Among those that said their vehicle mix would evolve, there was an expectation that the amount of electric and hybrid vehicles would almost double, going from 37 per cent in 2024 to 63 per cent of fleets by 2029.