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Call Center/Command


Not just for trucks anymore

Not just for trucks anymore

As automatic vehicle location (AVL) providers continue to add depth and sophistication to their high-end solutions for long-haul trucking companies, many
  • Written by Urgent Communications Administrator
  • 1st June 2004

As automatic vehicle location (AVL) providers continue to add depth and sophistication to their high-end solutions for long-haul trucking companies, many are finding tremendous opportunities in the largely untapped local commercial-fleet market.

“The trucking industry is more mature, although trucking is still growing at double-digit rates year over year,” said Mike Brown, Aether Systems’ vice president of marketing. “But the biggest market growth is in the non-trucking segment.”

There are many reasons for the trend, not the least of which is the drastic reduction in price for AVL systems, Brown said. For years, the typical in-vehicle AVL system cost $2000, with a $100-per-month service charge — a logical investment for a long-haul carrier wanting real-time information about a fleet of $120,000 cabs towing $25,000 trailers filled with even more expensive inventory, but too pricey for average commercial fleet owners, especially those with small fleets.

Today, AVL systems can be installed for less than $500, and monthly payments are comparable to the cost of dial-up Internet access, which means they can fit within the budget of an owner managing fleets of less than 20 vehicles. But convincing a fleet manager to invest in an AVL system after years of operating profitably without one is not an easy chore.

“When we get into commercial vehicles, there’s a two-step process: One is convincing them this is a good idea, and [the other] is convincing them to use your system instead of your competitor’s,” Brown said. “The challenge is finding those people, getting the message to them and getting in front of them.”

That message is that AVL provides fleet managers with real-time visibility of their mobile units, giving them a tool to generate greater efficiencies by monitoring behavior, developing better route patterns and reducing paperwork for employees.

“We generally have to take customers through the [return on investment], including avoiding overtime and avoiding the need to hire new people,” said Tom Allen, chief operating officer and executive vice president for @Road, the AVL leader in the local fleet market.

Apparently, the AVL message is being well-received by companies, as the number of fleet vehicles — taxis, trucking fleets, service vehicles and local delivery fleets — using a tracking system doubled during the three-year period ending in 2003, said Clem Driscoll, president of C.J. Driscoll & Associates.

In fact, local fleet vehicles now outnumber the long-haul trucks using AVL, according to Driscoll. However, while almost all of the top 50 long-haul trucking companies have tracking systems, less than 10% of local commercial fleet vehicles are equipped with AVL devices, meaning there are considerable opportunities in this sector.

“Projections indicate [AVL usage in local fleets] will double again in the three years ending in 2006,” Driscoll said. “So the market should continue to grow.”

Probably the most-cited benefit that AVL systems provide fleet managers is greater accountability within their mobile work force. Because they are not subject to the same direct supervision as those working in an office, mobile employees traditionally have had greater opportunities to abuse the system, usually by using the company vehicle or work time to conduct non-business-related activities.

Such behavior can be caught via an AVL system; more likely, it will be halted even before it starts once the mobile employees are informed of the monitoring capabilities. Such oversight generally is not popular initially among mobile workers, particularly those who are distrustful of management, Allen cautioned.

“What are their labor relations like?” he said. “If they’re bad, this will cause more problems. If they’re constructive, this will probably work well.”

Brown said companies should not hesitate to seek methods to better supervise their local fleets.

“First of all, you have that oversight on every other part of your business; why should mobile workers be any different?” Brown said. “Second, if your employees are like most, the 90% of the people you pay that work hard don’t want to work with the 10% of the people that slouch.”

Meanwhile, some of the greatest advantages of AVL technologies cannot be measured easily on a balance sheet, according to Bill Erwin, president of Ohio Fire & Safety, a fire-protection equipment service in Columbus with a fleet of 14 vehicles that uses Aether Systems’ 20/20V offering.

In addition to conducting routine maintenance of customers’ fire extinguishers and alarms, the company must respond quickly to provide help in unforeseen situations — a less-than-smooth process, Erwin said.

“If we had a call during the day, we had to guess where people were to see who was closest, or we had to interrupt them with a call to find out,” Erwin said, noting that many calls interrupted employees as they were trying to work and did not result in new assignments.

Today, the process is much more efficient, with a manager able to glance at a Web-based map marking the location of all vehicles to determine which one is closest to the site in question — or closest to one of the company’s three offices, if a large amount of equipment needs to be loaded before going to the site.

One of the handiest uses of the AVL system proved to be something the company never imagined — providing evidence in billing disputes. This occurred after Ohio Fire & Safety employees worked a Saturday night and most of Sunday to help a customer whose establishment was flooded when a frozen pipe broke. When the customer tried to contest the bill, Erwin produced the AVL log, which showed the arrival and departure times of his employees.

“Boy, that problem went away [immediately],” Erwin said. “Now, we print out those log sheets to make sure we have a copy, in case something like that happens again.”

In addition, Ohio Fire & Safety is using the AVL advantage as a sales tool to acquire customers and is automating many reports that previously were done manually. Erwin said he’s not sure if Aether’s return-on-investment estimates proved to be correct, but he’s sure the AVL system is worth the money.

“My gut feeling is that this system pays for itself, but I can’t tell you it saved me this much here and this much there,” Erwin said. “What I can tell you is I won’t be without this system again.”

And there are many systems to choose from. While the foundation of the AVL industry is satellite-based, Aether also uses the Motient terrestrial wireless data system when vehicles are in metropolitan areas, Brown said. Meanwhile, advances in the sophistication and coverage of commercial wireless systems supply another way to provide AVL functionality using technology already in use by most fleets, Driscoll said.

“The GPS capability is there, but it’s only accessible by a third party with the Nextel network right now … but that will undoubtedly change,” Driscoll said, noting plans by Sprint PCS and Verizon Wireless to add this functionality to their nationwide high-speed networks during the next year.

Allen said AVL providers need to be able to work on all platforms to ensure growth opportunities. Another platform expected to be integrated in future AVL offerings is radio frequency identification, which eventually will allow fleet managers to monitor the contents within a vehicle.

With high-end trucking solutions already allowing remote monitoring of fuel gauges and whether doors open or close, both Allen and Brown say it’s important for AVL companies to provide customers with a portfolio of automated reports that give them control of the information instead of being overwhelmed by it.

“We’re a wireless company, but a lot of times I feel like we’re an IT company,” Brown said.

That’s the right approach, Driscoll said. “The vehicle-tracking business, over time, will be less of a hardware business and more of a service business,” Driscoll said. Even after basic AVL becomes a commodity, “there still will be an opportunity for GPS service companies to provide monitoring and reports.”

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