Technology Newsmaker Q&A Rickard Andersson

What are the key growth drivers for fleet management in North America? The traditional market drivers such as increased efficiency, security, environmental performance and control of fleets are still very much relevant, especially for companies which have not yet adopted fleet management solutions or fleets which have previously opted for basic systems with limited functionality in terms of performance enhancements. Applications focused on regulatory compliance are further very much a key driver, and this is especially the case in North America. The ELD mandate is currently the most important development and new solutions are continuously emerging from players across all parts of the ecosystem.

What role does telematics/remote diagnostics play in the fleet management space? Is that expanding?
Remote diagnostics functionality plays a key role especially as part of the service offerings of commercial vehicle OEMs. Several OEMs have extended their remote diagnostics offerings in recent years and integration with aftermarket systems has become increasingly common. The market has seen an increasing number of partnerships between vehicle OEMs and established telematics providers.

The initiatives can in later phases be extended with additional back-office functionality from the telematics provider’s portfolio as well as brand-specific features. As part of OEM offerings, basic telematics services such as remote diagnostics are now increasingly included for free for the first years after purchasing a vehicle. Extended coverage and additional fleet management services are commonly offered as subscriptions.

What are the key challenges/barriers to adoption in the North American market?
Limited IT know-how among potential target customers and general under-capitalization in some customer segments constitute barriers against adoption of fleet management solutions. Particularly micro businesses have historically proven difficult to reach, even with low-cost propositions.

Are those barriers different in Latin America? If so, how so?
Latin America has traditionally presented a very different scenario than North America. Basic track and trace solutions are common in the region, with special features such as panic buttons and remote immobilizers. Such solutions are available from a myriad of suppliers and often provide little functionality beyond the possibility of ensuring that vehicles and cargo are not lost – and recovered if so. Providers of advanced fleet management solutions have claimed to have a hard time convincing businesses of the efficiency gains made possible by high-end FM applications. 

The Latin American fleet market has, however, over the years started to evolve. SVR-type offerings focused on asset protection are still a common market entry point for fleets, but companies are increasingly also moving towards adoption of valued-added services that help reduce operational costs and improve productivity by for example optimizing routes and reducing fuel consumption, accident rates and idling time.

Subscribe to Aftermarket Business World and receive articles like this every month….absolutely free. Click here.