Why the Fleet Management Industry Will Double over the Next Five Years
In coming years, technological innovations and global market forces will dramatically increase the size (and effectiveness) of the fleet management sector. According to the FMCSA (Federal Motor Carrier Safety Administration), new technologies will save 26 lives and prevent almost 600 injuries each year. Drivers will be protected from exhausted bus and truck drivers; drivers, in turn, will be protected from harassment and coercion.
In the years to come, fleet management systems will create safer roads and skies. Companies with mobile assets will realize massive cost savings and efficiencies. Businesses that take advantage of today’s cutting-edge fleet management systems can get ahead of the curve – and the competition.
Introduction to Fleet Management
The term “fleet” may conjure up images of massive naval operations; however, fleet management involves much more than just ships. Yes, the U.S. Navy has invested heavily in high-tech, green fleet management technologies. However, fleet management systems bring massive cost reductions, PR boosts, and logistical advantages to organizations of all kinds.
Companies must invest in fleet management systems to stay competitive. Real-time tracking and logistical optimization systems are changing the face of mobile asset management. Businesses can either get ahead of the competition by adopting these technologies now – or scramble to catch up.
Why Companies Need Fleet Management
Municipal transit systems, rental car companies, and corporate fleets of all sizes benefit greatly from recent advances in tracking technologies. Fleet management systems have changed the game in the railway, air travel, construction, truck transport, car rental industries (just to name a few). Customized fleet management software can mean the difference between surging forward and falling behind.
From hassle-free driver logs to the tracking of expensive assets, companies of all size increasingly rely on fleet management. By knowing the locations of all mobile assets in real-time, business leaders can maximize efficiencies in all aspects of their operations. With fleet management systems, corporations can optimize everything from passenger bookings to product arrival times and ensure fleets operate at full efficiency.
Expected Market Growth
Industry analysts expect the fleet management industry to reach $28.6 billion by the year 2022. Researchers predict CAGR (Compound Annual Growth Rates) of over 15% during this period. Some experts anticipate even faster growth, with market volume hitting $27.9 billion by 2021.
This massive surge in market size depends on a variety of factors:
Regular Fleet Maintenance
As fleets age, companies must replace obsolete vehicles with newer ones. The fleet management industry sits atop this firm financial foundation; no matter what, companies need to transport their goods to market. This evergreen business expense only expands as economies and businesses grow and prosper.
Industry analysts expect developing nations to spend heavily on fleet management infrastructure. NGOs have invested massive amounts in managing the world’s humanitarian fleet (their biggest expense, after staffing) to bring aid to many of these countries. Without legacy systems in place, previously “third world” countries can leapfrog inefficient 20th-century technologies.
As new corporate, municipal, and governmental players enter the fleet management market, this sector will see remarkable growth. Globalized transportation changed the business landscape in the last century; in the decades to come, smart transport will create even greater opportunities for tech-forward organizations.
Increasing numbers of governments are mandating the use of GPS (Global Positioning Systems) and ELD (Electronic Logging Devices). As this trend continues, government/military fleet managers will invest heavily in vehicles with the necessary technologies. These mandates will spur growth in the consumer and manufacturing sectors, further increasing the need for fleet management systems.
Wireless fleet tracking technologies don’t just create safer driving conditions for everyone on the road. These systems dramatically reduce fleet management costs. Instead of using paper logs or un-networked computer systems, companies can track fleet usage in real time. Tomorrow’s business fleets—whether consumer car rental, truck transport, or executive transport—will exemplify the just-in-time delivery model. Vehicles will show up exactly where and when people need them, especially as fleet management systems move to the cloud for flexibility, affordability, scalability, and speed. With these tools, fleet managers can increasingly anticipate and eliminate costly bottlenecks and supply/demand disparities.
The Advantages of Green Fleets
Cities like Seattle, WA use electric vehicles and fuel reduction policies to reduce their fleets’ carbon footprints. For example, Seattle recently purchased 120 electric buses with the aim to convert its entire transit fleet by 2034. Advances in technology mean these buses can travel 25 miles on a single 10-minute charge. In the coming years, more and more municipal governments will rely on green vehicles to facilitate operational and logistical efficiencies, reduce fuel costs, and reduce their carbon footprints.
Corporations benefit from the same fuel savings and efficiencies as governments, as well as PR boosts from adopting green technologies. For example, fleet management systems facilitate truck platoons, which can create fuel savings of up to 20%. In fact, efficient green innovations in the trucking sector are making it more and more competitive with rail transportation, even intermodal (container) rail systems.
With the advent of autonomous drone and cargo ship fleets on the horizon, the fleet management sector will experience massive growth beyond the 5-year mark. As driverless vehicles enter our skies, cross our oceans, and join us on the highway, fleet management systems will become absolute necessities. Companies that stay above the rising tide of fleet logistics technologies will realize astounding efficiencies and cost reductions in the years—and decades—to come.
Our fleet management software was designed from the ground up to support your current and future vehicles. With complete electric vehicle integration, you’re able to use one platform to increase fleet efficiency, reduce operating costs, improve the safety of your drivers, and maximize EV utilization. To learn more, visit our fleet management overview page.