May/June 2004

By 2005, 1.3 million new commercial vehicles a year will be fitted with telematics systems in Europe, according to a new report by consultancy Frost & Sullivan. It says the market will be worth more than a billion euros a year to the suppliers. Four years later, it says, there will be 5.4 million vehicles with telematics systems.

Yet despite this steady growth, it says that in a survey of 240 fleet managers around Europe, many were unaware of the benefits offered by telematics systems. More than half, for instance, hadn't understood that telematics could improve customer relationship management and reduce insurance premiums.

Managers of larger fleets were more aware of telematics than those with smaller fleets, and were twice as likely to have some kind of telematics equipment installed on their vehicles already. Almost three-quarters of respondents with international fleet operations were aware of telematics.

Enhancements to safety and security were considered the most desirable features offered by telematics systems, Frost & Sullivan says. Management and navigation features came a close second, along with the ability to monitor vehicle and driver performance.

 

When it came to ways of funding telematics, over a third of respondents preferred a one-off charge to a pay-as-you-go system. Frost & Sullivan suggests this might be because this allowed systems to be regarded as fixed assets in annual accounting. But subscription emerged as a better model for large fleets, offering greater flexibility and low initial investment.

On average, respondents said they thought a perfect telematics system would be worth 2,095 euros (around £1,250), but those who already had systems in place put a higher value on telematics than those who didn't.