What is Telematics?

Key Takeaways

Telematics is the technology used to monitor a wide range of information relating to an individual vehicle or an entire fleet. Telematics systems gather data including vehicle location, driver behavior, engine diagnostics and vehicle activity, and visualize this data on software platforms that help fleet operators manage their resources.

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Table of contents

1. How does telematics work?
2. Telematics and GPS Fleet Tracking
3. Telematics past, present and future
4. Telematics devices and software
5. What telematics can do for your business
6. The difference between GPS tracking and telematics
7. Which vehicles can telematics be used for?

How does telematics work?

The word ‘telematics’ is a compound term. It combines ‘tele’ – a prefix denoting remote communications (the prefix is derived from the Greek for ‘far off’, or ‘at a distance’) – and ‘informatics’, a discipline incorporating the practice of information processing. Hence, this is how telematics works: transmitting information over lengthy distances. It is used for a variety of commercial and non-commercial purposes, but when this technology is used in fleet management, it is most commonly utilized to manage vehicles or other assets remotely, and to provide an overview of a range of information relating to them.

In recent years, telematics has changed the face of a number of industries, with it driving major transformation in transport, construction and site excavation. Firms managing fleets of vehicles across a huge range of sectors have come to adopt telematics, which has helped to improve reliability, boost customer service standards, increase efficiency and enhance the bottom line.

Telematics and GPS Fleet Tracking

Fleet telematics gathers a range of data using Global Positioning System (GPS) technology, sensors and vehicle engine data to provide fleet operators with the information they need to manage their fleet. 

• Global Positioning System (GPS) technology - powers live visibility into vehicle location, speed and movement within points of interest through geofencing.  
  Sensors – enable the capture of data on driver activity, including aggressive acceleration, harsh braking and erratic cornering, but sensors can be used to monitor any in-vehicle activity such as a door opening, tail lift raising and even trailer temperature. 
  Engine diagnostics – these solutions pull data directly from the in vehicle diagnostics system and are primarily used to gather real time data on fuel efficiency and vehicle odometer readings that help power digital fleet maintenance solutions.

The data is temporarily stored in a telematics device that in installed in each vehicle, and is then transmitted over private cellular networks to secure servers. It is this central data hub that enables fleet management software to provide easy-to-understand visualizations that help fleet managers optimize their operation.

Telematics past, present and future

Telematics technology developed out of the rapid expansion of the internet from the mid-1990s onwards. The greater availability and practicality of telecommunications technologies that arose in tandem with this expansion also produced new forms of remote communication. Over the years, these developed into what we know recognize as modern telematics systems, and these have been particularly widely adopted over the last decade.

Fleet management programs now enable firms to manage fleets of all sizes – from a handful of vehicles to hundreds – and help deliver major improvements across the board. Telematics has now developed to the point where it goes well beyond mere asset tracking to incorporate vehicle and driver performance as well as maintenance management. 

The growth of telematics technology continues apace. Although the adoption of telematics has already become standard across various industries, the technology itself continues to evolve, and to grow in power and capacities, all the time. The burgeoning driver shortage affecting the transport sector and the continuing challenge of regulatory compliance are likely to have a major bearing on the future of telematics.  

Telematics is also proving crucial in what has become known as the Internet of Things that Move (IoTtM); specifically, in transport and freight. These sectors have been leading adopters of IoT technology, with the data it provides allowing for more efficient routing and scheduling as well as generally better-optimized use of resources. The IoTtM thus encompasses, for example, location tracking and driver and equipment operator monitoring, including engine and driver hours. The main benefits of this include:

• Reduced fuel costs. With fuel consumption being one of the most pressing costs facing fleets, detecting and reducing excessive fuel use is absolutely crucial to overall efficiency. Telematics does this through more direct route planning, reducing job site bottlenecks and cutting engine idling, while also detecting unauthorized vehicle or equipment use (enabling firms to cut down on resulting fuel usage).
• More cost-effective fleet maintenance. Telematics warns managers of mechanical issues with vehicles and equipment, which allows them to address these problems sooner and thereby reduce the danger of downtime (which is not only inconvenient but can also have serious knock-on effects for other jobs). It also makes scheduling preventative maintenance simpler, which again helps to maximize vehicle and equipment uptime.
• Better communication. Previously, keeping in touch with drivers and operators out in the field could be a complex business. Telematics simplifies communication processes and significantly reduces the need for human operators and drivers to check in and report back, automating much of this process. As well as ensuring that managers have access to the data they need faster, this allows operators to spend more time concentrating directly on the job in hand.
• Enhanced fleet safety. Another crucial consideration (and a central legal responsibility) for firms operating fleets of vehicles and equipment, safety is of paramount importance. Telematics improves safety management by monitoring both driver and operative behaviour, and vehicle and equipment performance. It allows anomalies – such as unsafe practices – to be detected and addressed quicker. It also allows for emergency assistance to be directed straight to the site where it is needed, through location tracking.

Telematics is also helping both industry and society adapt to the continuing challenges facing major towns and cities. The mounting pressure on urban infrastructure (particularly transport) requires industry to take innovative and imaginative measures; this has led to the rise of the so-called ‘smart city’. This means, in a nutshell, using data and technology to maximize efficiencies (from energy efficiency to traffic management) and thereby make urban environments more practical, sustainable, secure and liveable for all concerned. 

Telematics devices and software

Most commonly, telematics data is collected by a small device installed in the vehicle (or other asset) itself. This collects stores and transmits different types of information relating to the vehicle’s performance, condition and usage. There are different types of telematics devices available that offer different functionality and benefits. The most accurate and secure telematics devices are hardwired, these devices offer tamper proof functionality and a wider range of connectivity to peripheral devices.

Telematics devices are often connected to other in-cab driver interfaces that enable drivers to receive jobs, capture proof of delivery, complete pre-trip inspections and even get real time feedback on their driving performance.

 

What telematics can do for your business

There are a number of areas where telematics systems can benefit businesses. Telematics systems do more than just keep fleet managers abreast of the location of vehicles. They greatly streamline communication, job dispatch and routing, and also record and transmit information on whether individual vehicles are in motion or stationary, their engine performance (including power-up, shutdown, idling or malfunctions), vehicle speed, driver conduct and more besides. This benefits business in the following ways:

• Improved service. Through knowing the exact location of each vehicle in the fleet at any time, dispatchers can make constant routing adjustments responding to changes in the traffic, vehicle availability or weather conditions. In this way, they can switch resources around and ensure that deliveries reach customers when they need to. In addition, they are also able to keep clients informed as to their delivery’s estimated time of arrival, helping to increase customer satisfaction. For example, one firm – Pointdirect Transport – increased business growth more than 20% every year after introducing telematics.
• Lower administrative costs. Telematics also greatly simplifies compliance and administration, through electronic logging device data as well as automated mileage expense reports & integration capabilities ( Pro miles take the data generated from the mileage reports and converts them into the required compliant format needed to submit to the BOE ) . The latter can be used to reduce the administrative burden in addition to supporting International Fuel Tax Agreement.
• Lower administrative costs. Telematics also greatly simplifies compliance and administration, through electronic logging device data as well as automated mileage expense reports. The latter can be used to reduce the administrative burden in addition to supporting International Fuel Tax Agreement.
• Improved safety. Telematics can provide drivers with enhanced safety, for example via its location tracking allowing for quick emergency aid where it is needed. Telematics is more generally known to improve driver behavior. In-cab feedback can alert drivers to dangerous conduct, and telematics data can also be used to develop individual driver training and development programs.

The difference between GPS tracking and telematics

GPS tracking is an essential and central component of a telematics system. As we’ve discussed, it allows fleet managers to keep track of their fleet assets at any given time, providing them with a comprehensive overview of what resources they have at their disposal. However, telematics cannot be reduced to a simple vehicle tracker – we have already highlighted that it has a vast array of capabilities other than this. It is because of this versatility that telematics has become so central to fleet management in recent years by empowering the vehicle tracking systems. Telematics devices capture data points including the following:

• Vehicle location
• Geographical point of interest (Geofencing)
• Vehicle speed
• Vehicle incidents (harsh braking, acceleration and cornering)
• Vehicle diagnostics (e.g. EPM, MPG, odometer)
• Vehicle status (customizable)
• Remote vehicle inspection reports
• Panic alerts
• Job dispatch and messaging
• Electrical or sensor activity (via PTO)
• Dashboard camera footage

In addition, telematics systems integrate vehicle routing and maintenance scheduling with driver performance, providing a comprehensive and broad-based solution to the key challenges facing fleet management. Thus, they go well above and beyond vehicle tracking alone.

Which vehicles can telematics be used for?

Telematics is a versatile technology, both in the number of functions it can perform and the range of different vehicles and other assets with which it can be used. It is suitable for use with the following vehicles and assets, among others:

• Cars: As well as performing important productivity and vehicle maintenance functions for company car and sales fleets, telematics is also used to monitor private mileage and ensure health and safety compliance, an essential part of employers’ duty of care.
• Cargo vans/pickup trucks: Used for functions including job dispatch and routing, time on site reporting, time sheet reporting, proof of delivery solutions, monitoring unauthorized vehicle use and tracking driver behavior.
• Single axle/tractor units: Here, telematics helps with route optimization and scheduling, driver hour management, fuel management and driver behavior reporting.
• Buses and coaches: Telematics provides assistance with driver hour management, route optimization and scheduling, fuel management (including engine idling), integration of services (through, for example, time of arrival notifications) and driver behaviour reporting.
• Heavy equipment: In the construction industry, telematics is used for heavy earth-moving equipment. Here it serves to boost jobsite productivity by tracking equipment utilization, enabling preventative maintenance and reducing fuel burn.
• Specialist vehicles: Telematics is also widely used for a range of specialist vehicles, including dump trucks, tow trucks and cement trucks. Among other benefits, the technology provides a better understanding of vehicle activity through power take-off, where mechanical power is transferred to another piece of equipment (such as the cement mixer on a cement truck, for example).

It is this sheer versatility of telematics that has guaranteed it an instrumental (and expanding) role in fleet management for the long term. It is already delivering major improvements to safety, productivity and ultimately profitability, and it is only likely to become more central in the years ahead. Those businesses across the world that integrate telematics systems into their operations can expect to continue to reap significant rewards.

Learn More About Telematics

• What is GPS fleet tracking?
• What is weather telematics?
• How does telematics work?
• What is Geofencing?
• What is asset tracking?