March/April 2005

There are valid reasons for fitting telematics equipment in vehicles, delegates heard at this year's FTA Summit, including accident and emergency management and emission monitoring. Then there are other reasons, such as road-user charging- Robin Meczes was there

No market in Europe has higher penetration of telematics equipment in vehicles than the UK - but then again, the UK is the most congested and most difficult place to get around in. And despite the relatively high take-up here, telematics still has a long way to go before the true benefits are felt, according to Dr Wolfgang Reinhardt, director of regulatory affairs at the European Automotive Manufacturers Association (ACEA).

Speaking at this year's Freight Transport Association Freight Summit, Reinhardt said that UK take-up of telematics would be boosted in the near future by a number of factors, including environmental requirements.

"There is no doubt that regulations on emissions will become stricter. The most recent DfT proposals would impose monitoring of NOx with a sensor positioned in the exhaust system that would alert the driver in case of malfunction and activate a torque limiter," he told delegates. "It is highly undesirable from our point of view that environmental systems should become enforcement systems, but you will be surprised by the role that telematics will play in the future in the environmental field..."

 

The role of telematics in assisting those involved in accidents is another factor likely to boost the market, said Reinhardt. "There are 1.2 million people killed worldwide and 50 million injured every year. It's obviously important to avoid accidents in the first place, but you also need to provide effective help in case of an accident. Vehicle-integrated emergency call systems combined with satellite positioning are top of the agenda for both cars and trucks."

Calculations by ACEA suggest that the cost to the public purse and insurers of dealing with accidents could be reduced by 21 billion euros a year, yet to install the necessary equipment in vehicles would cost only a fraction of that amount. But despite a lot of interest, the parties that would really gain from this seem unwilling to foot the bill, said Reinhardt.

"Those who would benefit are not putting their cards on the table. With electronic vehicle identification, there would be savings on the insurance side and on the tax side, not least in terms of the impact on the many people currently driving without paying for insurance.

"But not to talk about the savings, and just to force the automotive industry by regulation to put systems into vehicles - and so force the cost on to the manufacturer - is to try and get the savings without paying for them. That doesn't work.

"I think we could make major steps forward when everybody who stands to make those savings or is helped to protect their revenue puts their cards on the table and says 'that's what we can have, here are the costs,' and then starts working on a joint business case together," said Reinhardt.

Road user charging is another area that will inevitably increase the usage of telematics systems, added Reinhardt - especially given the EU Interoperability Directive, which is designed to ensure that by July 2009 a single black box in each vehicle will be able to cope with a variety of different charging schemes. And commercial vehicles now represent perhaps the most exciting sector of the market, he said. "Almost all the car manufacturers, with few exceptions, have stepped out of the business. But new impetus is expected to come from the introduction of standardised location-based emergency and roadside assistance services, dynamic real-time road and traffic information and from commercial vehicle telematics."

On the subject of lorry road user charging Mike Shipp, director of the LRUC project at HM Customs & Excise, gave the strongest indication yet that the technology to be employed would indeed be telematics-based - and users could have to pay part of the cost.

"I think it's probable we will have on-board equipment, and our bidders are telling us that GPS is a technology that is proven," he said. HMCE has specified only a minimum requirement for its own needs, but the eventual technology selected will probably be capable of offering vehicle operators other telematics applications, he also confirmed. "We are looking for an assurance from bidders that any other applications that box may provide won't interfere with LRUC requirements. We're also concerned not to create any monopoly or distortion of the telematics market. But our expectation is that the bidders we are dealing with will have an eye on the commercial capabilities they may be able to exploit to offer other services to operators."

And Shipp again rejected criticism that the whole system was technically too complicated. "There are those that have suggested that this is a rather sophisticated scheme - too sophisticated for its purpose - and that it's going to cost a great deal. We're concerned about costs, too. But we're also concerned with achieving value for money, and that doesn't necessarily mean going for the cheapest system. It's a combination of the right technical system, the best price, and quality. A cheap system that doesn't work, or one where we have armies of civil servants running about trying to ensure compliance, doesn't represent good value for money."

Challenged by one delegate to deny categorically that the UK transport industry would face any additional costs as a result of fitting the necessary equipment to vehicles, Shipp admitted that he could not. "I have yet to tell ministers what LRUC will cost them, and I won't be in a position to do that until I have completed negotiations with the suppliers. So no, I can't. Ministers are aware this is a concern for the industry, but it cannot be addressed until we know what those costs will be. Ministers will not take a view until they know what the cost of that unit might be, what the installation implications of it are, or the rates of the charge itself. What this proposition is effectively inviting ministers to do is write a blank cheque - and in my experience ministers are rightly reluctant to do that."

Asked if OEM GPS equipment being installed on trucks for non-LRUC purposes might obviate the need for a second, separate LRUC black box, however, Shipp had better news. "It's the functionality we're after so yes, if it works and any commercial applications aren't going to interfere with what we require."

The eventual technology chosen to implement the UK's lorry road user charge (LRUC) will make or break the whole project, according to a leading road transport industry figure.

"Whatever the technology eventually chosen, it will be crucial to the success of the scheme," said John Allan, FTA president and chief executive of logistics service provider Exel.

"Its success or otherwise will be determined by the ability of technology companies to deliver and operate reliably a system that accounts for over 430,000 vehicles running on 300,000 miles of road, contributing over £4billion to the Treasury," he said.

Allan also expressed serious concerns about who would end up paying for the telematics equipment likely to be required. "The biggest uncertainty is the cost of installing and operating the collection system and administering the all-important rebate of fuel duty. The main reason for that uncertainty is that the technology to be used has not yet been specified," he said.

Data protection still an issue

The outlook for telematics may be positive, but David Faithful, partner at law firm Clarke Willmott, has warned that the issues of privacy and data protection have still not been resolved when it comes to the use of telematics equipment. Speaking at the Freight Transport Association Freight Summit, Faithful said particular care was still needed over the use of what the Data Protection Act refers to as "sensitive" data - which is to say, data that could be used to incriminate or prosecute individuals.

Although there has been a general erosion of privacy in recent years, vehicle drivers still have employment rights, he stressed. "You have to be very careful as an employer in terms of how you deal with this," he said. "The Information Commissioner has already highlighted this as an issue."

Using speeding offences by way of example, Faithful said: "You're firmly in the territory of sensitive data here, because that information could be used for criminal prosecution. Unless employers have the written consent of their employees to collect that data, they shouldn't even be collecting it. And if they are collecting it without the consent of the employee, they cannot use the data for disciplinary purposes."