Dec 07/Jan/08

Telematics can deliver great benefits for light commercial vehicle operators, but convincing users requires a different approach. m.logistics listened to a range of views at the Light Commercial Vehicles Telematics Conference held in London by Telematics Update

Demand for telematics systems in the light commercial vehicle sector is predicted to grow by 32 per cent a year until 2012 in Europe, increasing the number of telematics units in use from 633,000 units in 2006 to over 3.4 million units by 2012.

Yet despite this growth, many suppliers don't understand the market and are uncertain how to sell into it, Michael Minich, a consulting analyst with Frost and Sullivan, told delegates at Light the Commercial Vehicles Telematics Conference this autumn.

The jaw-dropping 32 per cent growth could be driven by the buoyant economies of European, says Minich, which in turn are galvanising the service sector. But he warned that although the market is buoyant, competition is hotting up at the same time, so service companies have to be competitive and become more efficient.

Moreover, he said, despite the undeniably vigorous growth, van operators are serious under-users of telematics systems compared with heavy commercial vehicle operators. Although there are far more of them out there, only 3 per cent of LCVs have telematics systems fitted, compared with 12 per cent of HGVs.

Minich said problems for suppliers included both the sheer numbers of vehicles in service and the fact that the market was highly fragmented. 'Suppliers will need to differentiate between the various segments, and shift their thinking from providing fleet management solutions to offering field force management solutions.' Web-based solutions will be essential, he predicts, because users will want low-cost easy-to-use systems.

Darren James, head of transport provision for Bracknell Forest District Council, concurred that telematics providers had an image problem. 'There's a perception that telematics suppliers are sharp-suited aggressive IT sales people who don't understand the fleet market, and think that they can sell one product to everyone.' James thought a strictly controlled telematics association might help raise standards.

Carphone Warehouse is not a traditional supplier to the telematics market, but the company thinks that fact will actually help it in building up its business with companies operating vans. 'Telematics products are too complicated, and many lack relevance for smaller businesses, even though these represent a huge market,' said Mark Lutitt, head of in-car solutions for Carphone Warehouse.

'Propositions need to be customer-driven rather than technology-based. Customers prefer converged devices, because that approach eliminates the complexity and cost of having multiple devices.'

In response to this demand, Carphone Warehouse has developed MyMobileDrive for employers. The device is an all-in-one solution that includes satnav, Bluetooth hands-free, Internet access, contact book and MP3 music, all accessed via a 4in touchscreen. The data/SIM card and GPRS connectivity allow managers to keep track of vehicles via a Web-based street-level tracking application, and to download journey reports. The cost is £650, plus £15 per month subscription

TomTom Work is another solution aimed squarely at the LCV market that can be used by small and large business alike. 'This market has straightforward requirements and needs a simple integrated plug-and-play solution,' said managing director Thomas Schmidt.

He believed that smart navigation which included traffic data was essential to maximise the benefits of connecting mobile workers. 'Better maps with up-to-date route data, combined with real-time traffic information, deliver benefits to mobile operations on a daily basis.'

Navigation had to be connected with traffic data, said Schmidt, to deliver a realistic experience. 'You need to understand the average speed on a road segment to deliver good data such as estimated arrival time. Incorporating dynamic traffic data will help deliver this, as would downloadable up-to-date navigation maps.'

Echoing the need for low-cost solutions, Stuart Barton of Stuart Barton Couriers said Google maps and low-cost GPS units had transformed his business, without big expenditure. 'We can stay in touch with drivers, and plot their position on the map. It's all we need. Dedicated rugged terminals and signature capture devices are out of reach of owner-drivers. Smartphones with a stylus make inexpensive signature capture possible.'

Proving that you don't have to be a big company to succeed in this market was Autoalert. It had developed a tracking system for a local Interlink Express franchisee, which ran alongside Interlink's own parcel track-and-trace system. 'It is a question of understanding what customers need, and sometimes that may not be what they think they want,' managing director Richard Harris told delegates.

'When customers ask for real-time tracking, do they need it minute by minute, every 15 minutes or every hour? Small fleets can end up paying for features they don't want or are ever likely to need.'