2 017 TELEMATICS BENCH MARK REPORT NZ€¦ · The slow increase in New Zealand’s pool of commercial ... global annual average of 6-7 per cent.2 ... In a competitive market, telematics

2017TELEMATICSBENCHMARKREPORT

Survey name lock-up

NZ

Foreword

This report presents the findings of a 2017 survey completed by fleet management professionals in New Zealand that operate in trucking and construction, the largest share of industry segments represented in this survey, as well as manufacturing, professional services, energy and other industries. The survey results were compiled by an independent research group. Each respondent has experience in fleet operations, the majority as owners, managers, or in maintenance or administrative office occupations.

KEY THEMES

Financial considerations are a primary issue, with most organisations mentioning operational costs and revenue growth as their principal challenges within the next year.

Payroll is identified as the operating expense that leads all others by a significant margin.

Technology is a vital component in these activities — and is rapidly becoming fundamental to everyday operations.

Most survey respondents look forward to benefiting from increased opportunity within the next months, with many indicating plans to increase their capital expenditure to meet demand.

Staffing shortages continue, with firms experiencing pressure in finding and developing drivers and operators to satisfy their workforce needs.

2017 New Zealand Telematics Benchmark Report 2

The profit and loss sheet will drive 2017 business decisionsWhen asked to identify their top business goals for the next year, costs and profits were cited by a combined 81 per cent of respondents.

TOP BUSINESS GOALS FOR 2017

13%

Reducing operational cost

Increasing profits

Improving driver safety

Expanding customer base

Retaining customers

Adding new products and services

Improving vehicle safety

Expanding driver workforce

Improving driver retention

None

Other

15%

31%

40%

21%

41%

12%

11%

3%

1%

2%

Technology offers a distinct benefit in cost

reduction. Amongst New Zealand organisations

that have implemented telematics, 46 per cent

of respondents reported seeing a measurably

positive effect on their expenditure for fuel,

with cost decreases ranging from 5 to as much

as 30 per cent.

(Respondents could select more than one answer)


54%Payroll

34%Equipment/vehicle

maintenance

33%Purchasing new

equipment/vehicles

17%Other

2%Materials

4%Business software

15%Fuel

1. “New Zealand’s truck driver shortage,” Noted, April 8, 2016. http://www.noted.co.nz/money/investment/new-zealands-truck-driver-shortage/



Wages are the top cost for organisations in 2017When asked to identify the largest operating expense, more than half of all respondents (54%) cited payroll. Next was equipment and vehicle maintenance (34%).

LARGEST EXPENSE AREAS

The slow increase in New Zealand’s pool of commercial

truck drivers relative to the escalating demand for them is a

major contributor to upward wage pressure; new drivers are

not entering the workforce in numbers sufficient to keep up

with need.

Since 2000 the volume of freight carried on the nation’s

highways has increased 60 per cent, yet the number of

Class 5 (commercial heavy truck driver) licences issued has

seen only a 10 per cent rise.1

Hardware and human capital lead the list of investment plansScheduled financial outlay for this year concentrates on fleet vehicles and staff.

PLANNED INVESTMENTS FOR 2017

46%

Upg

radi

ng fl

eet

42%

Fin

ding

, ret

aini

ng a

nd d

evelo

ping t

alent

37%

Impr

ovin

g cu

stom

er ex

perie

nce

33%

Inte

grat

ing

tech

nolo

gies a

nd sy

stems

27%

Impl

emen

ting

tech

nolog

y for re

gulatory compliance

24%

Mor

e effi

cien

t GPS

tr

ackin

g

22%

Bra

nd a

ware

ness

16%

Exp

andin

g fl eet

5% N

o inv

estments planned

Oth

er 1%



Investing will be spread over a range of categories but a

combined total of 88 per cent of respondents will allocate

disbursement toward what might be called the moving parts –

the fleet and personnel.

56% 35%Plans for increasing fleet size overwhelmingly favour the purchase of new

units: 71 per cent of respondents said they will “buy more new vehicles,” 27

per cent will “buy more used vehicles,” and “rent more vehicles” is the option

selected by 24 per cent.

CHANGES BEING MADE TO FLEET SIZE OVER THE NEXT YEAR

Plans call for larger fleets, more equipment in 2017Slightly more than half of organisations surveyed intend to expand their operating capacity in the next 12 months.Those who intend to augment their fleets say that the number one reason for doing so is to answer an increased demand for their services. Others report a need to replace older equipment, and slightly less than half of respondents anticipate that domestic market growth will provide a positive effect.

Increasing No change

9%No change


Infrastructure investment committed toward improving the conditions

that beset New Zealand drivers, is expected to grow at an average rate

of 4 per cent a year, reaching $28 billion by 2025. That is lower than the

global annual average of 6-7 per cent.2

Congestion is the most challenging issue faced by trucking organisations—and there’s little

they can do in terms of improving traffic flow—but telematics may provide some relief

through real-time rerouting to avoid choke points or bottlenecks.62%

TRAFFIC CONGESTION

20%ROADWAY DESIGN (LENGTH OF LANES, ACCESS TO

MOTORWAYS/INTERSTATES)

2%6%

Heavy traffic is an irritation for drivers, dispatchers and managersWhile the obstacles that impede progress for survey participants include aging roads and bridges (15%), ongoing construction (19%), and road or traffic routing that is poorly designed (20%), these annoyances are slight compared to traffic congestion, which vexed 62 per cent of responders.

MOST CHALLENGING INFRASTRUCTURE ISSUES

19%CONSTRUCTION

PROJECTS

7%INADEQUATE SIGNAGE AND

SIGNALS

15%AGING ROADS AND BRIDGES

TRUCK STOPS/SERVICE STATIONS

ACCESS TO FUEL

13%NONE

NOT EXPERIENCING ANY CHALLENGES

(More than one response could be selected by a participant)


2. Outlook to 2025: New Zealand’s infrastructure investment spend. PricewaterhouseCoopers, 2017. http://www.pwc.co.nz/publications/central-government/outlook-to-2025-new-zealand-infrastructure-investment-spend/

Approximately 4 out of 5

organisations (79%) either currently

use telematics or have plans to do

so in the next year.

The rise of telematics in New

Zealand is notably rapid given that

the nation’s trucking companies

are typically small, family-owned

businesses—which generally

are not early adopters of new

technology. More than 80 per cent

of New Zealand carriers operate

five or fewer trucks.3

60%

9% 10%21%

Yes,

acro

ss a

ll ve

hicl

es/a

sset

s

Yes,

whe

n pr

ovid

ed b

y ve

hicl

e/eq

uipm

ent m

anuf

actu

rer

No,

and

no

imm

edia

te p

lans

to d

o so

No,

but

I pl

an to

in th

e ne

xt y

ear

3. “New Zealand Trucking Industry Shares Global Challenges in Recruiting Drivers,” Women in Trucking, 2016. http://www.womenintrucking.org/index.php?option=com_content&view=article&id=176:new-zealand-trucking-industry-shares-global-challenges-in-recruiting-drivers&catid=24:ellens-blog&Itemid=127


In a competitive market, telematics are indispensableFleet telematics are following the path traced by the Internet in the last 30 years—and the telephone more than 100 years earlier. Like these, telematics has progressed from technological phenomenon to vital management and communications tool.

ORGANISATION USING A TELEMATICS SOLUTION

Vehicle/equipment tracking

Speed

Distance driven

Hours of service/driver hours

Proof of service/jobs completed

Maintenance

Driver performance

Idling

Engine hours

Fuel usage

Harsh braking

Other

46%

46%

56%

65%

37%

32%

23%

21%

15%

12%

2%

79%

What they’re watching: telematics data monitoring and analysisOrganisations that use or intend to use telematics are most interested in applying the technology for tracking location and speed.

WHAT ORGANISATIONS MONITOR WITH TELEMATICS

Respondents identified “peace of mind knowing where vehicles are” as the top

benefit (79%) afforded by telematics solutions, followed by “improved driver

behaviour” (42%) and “more efficient routing and dispatching” (32%).



How deep does this technology go?With most New Zealand organisations that are already relying on telematics (69%), its use extends to the field nearly as much as in the back office. The application of telematics has been widely implemented at the vehicle or job site level.

OFFER MOBILE DEVICES TO DRIVERS FOR FLEET MANAGEMENT

No, employees can bring their own device and link to company systems

7%

No, but we plan to in the next year

5%

No, we don’t use mobile devices for fleet management

25%

Yes

63%Mobiles rule:

3 out of 4 survey

respondents (68%)

offer mobile devices

to drivers or plan

to do so within the

next year.

Those who offer mobile devices to their drivers

or operators report that the greatest benefits are

“more direct communications” (74%) and “easier

GPS/fleet tracking” (60%).


For many, telematics provides measurable fuel savingsSurvey respondents indicated “reducing operational cost” as their number one business challenge in 2017, and they look closely at which practices and technologies can help them achieve this objective. Many reported that telematics technology delivered positive results in helping to control a large operating expense.

HOW MUCH FUEL COSTS HAVE BEEN REDUCED SINCE IMPLEMENTING TELEMATICS

report 5-10% fuel savings

30%report 11-20% fuel savings

14%report 21-30% fuel savings

2%46%

report fuel savings

Percentage of respondents

Almost half (46%) of survey participants said that after adding

telematics their organisation has reduced fuel expenses.


Telematics promotes efficiency, but also shows promise in improving driver safetyAlthough organisations who use telematics cite operating efficiencies, peace of mind in knowing the location of vehicles, improved driver behaviour and other benefits as most important to them, a reduced number of accidents is another advantage the technology has provided to many.

Nearly a quarter of organisations with telematics

have lowered their rate of accidents and attribute

this to their use of a telematics solution.

FEWER ACCIDENTS AS A RESULT OF TELEMATICS

23%YES


Anticipating staff requirements: still not an exact scienceIn general, New Zealand fleet operators are not applying high-tech approaches in staffing projections. Many rely on paper files, experience or intuition.

HOW THEY CURRENTLY FORECAST HIRING/BUSINESS NEEDS

36%Manually pulling records/paper-based processes

23%Not currently forecasting

19%Guessing

18%Tool for big data analysis

11%Other

This lack of reliance on more precise forecasting tools is unusual in an industry

where hires are predominantly not casual or part-time but engaged on a

permanent basis.

These survey respondents report that 64 per cent of their drivers are full time,

with hourly drivers at only 22 per cent and for-hire/contingent drivers at 1 per cent.

The preponderance of full-time, permanent drivers and operators

(as opposed to part-time or contingent workers) correlates with

an older, more experienced workforce in these occupations. The

average age of a New Zealand commercial trucker is 53.4

4. “New Zealand Trucking Industry Shares Global Challenges in Recruiting Drivers,” Women in Trucking, 2016. http://www.womenintrucking.org/index.php?option=com_content&view=article&id=176:new-zealand-trucking-industry-shares-global-challenges-in-recruiting-drivers&catid=24:ellens-blog&Itemid=127


Staff shortages remain a problemNew Zealand is highly dependent on trucking to move an increasing volume of goods to distribution centres and individual retail locations. This reliance on truck traffic and a small pool of skilled drivers places pressure on owners and hiring managers. Skilled equipment operators are also in demand.

EXPERIENCING A DRIVER SHORTAGE

54% YES

46% NO

When management were asked

to indicate how they address staff

shortages, 48 per cent selected

“increasing pay.” Another 41

per cent reported “developing

educational/training programs”

and 32 per cent, “offering better

benefits,” followed by “hiring

freelance/contingent drivers” (30%).

New Zealand’s National Road

Carriers group says the sector has

been short of drivers for a decade.

This problem is anticipated to get

worse as the amount of freight is

predicted to increase up to 75 per

cent in the next 20 to 30 years.5

5. “Trucking Sector Begging for New Drivers,” New Zealand Herald, January 26, 2016. http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11579723


Which workers are employers most keen on hiring?Drivers are expected to comprise the largest numbers of new hires in 2017, as organisations look to meet their current and projected workload.

WHAT ROLES ORGANISATIONS EXPECT TO INCREASE IN THE NEXT YEAR

54%Drivers

27%

None

12%

Dispatchers

12%

Maintenance managers/professionals

6%

Technology experts

5%

Fleet operations

5%

Other

11%

Compliance professionals

More than half of organisations (54%)

intend to increase staffing of drivers

and operators, more than four times

as many responses for any other job

classification, including all types of

office personnel.



How organisations deal with the demand cycleNearly every operation experiences unpredictable changes in the amount of work they have at a particular time, as slow periods alternate with new opportunities. But almost half (45%) say they make no adjustments to accommodate for these variables.

HOW THEY MANAGE FLUCTUATIONS OF INCREASED DEMAND

Only 55 per cent of organisations put in to practice one or several

actions to compensate for the periods of high and low activity.

We don’t do anything different when demand increases

45%Outsource

trucks/equipment

25%Outsource drivers/

equipment operators

23%More efficient

routes for drivers

16%

More reliance on technology/telematics

9%Other1%

Adjusting for demand cycles is difficult in part because at present

the New Zealand trucking industry has a serious overcapacity

problem. Approximately 40 per cent of trucks traveling its

highways are making a return trip carrying nothing but air, or as

truckies express it, “yacht fuel.”6

6. “‘Yacht Fuel’ is the Most Common Load Carried by Truckies,” Business Day, April 9, 2017. http://www.stuff.co.nz/business/money/91316728/yacht-fuel-is-the-most-common-load-carried-by-truckies



Survey overview and methodologyNew Zealand

The 2017 Teletrac Navman Telematics Benchmark Survey is based on responses from more than 1,200 fleet operations and fleet management professionals from around the world. This report affords a view into best practices and trends in telematics and fleet management. Of the total survey respondents, 212 who indicated that they are based in New Zealand provided the data used to produce the 2017 New Zealand Telematics Benchmark Report. Results may not amount to 100 per cent due to questions with multiple selections. For reporting purposes, all statistical values have been rounded to the nearest whole number.

TYPE OF FLEET OPERATIONS INDUSTRIES REPRESENTED

FLEET SIZE (NUMBER OF VEHICLES)

1-9

10-24

25-50

51-100

101-500 9%

11%

19%

24%

34% 59% >105,000 kilometres

11% 75,001 to 105,000 kilometres

11% 50,001 to 75,000 kilometres

12% 30,001 to 50,000 kilometres

6% 15,000 to 30,000 kilometres

1% <15,000 kilometres

The majority of respondents represent fleets that drive over 105,000 kilometres per year.

Other

Private fleet

For-hire fleet

Government agency

TOTAL ANNUAL MILEAGE BY FLEET

500+ 3%

30% Construction

22% Transportation

4% Manufacturing

4% Professional services

4% Technology

3% Education

3% Energy/utilities

3% Leisure/hospitality

2% Government

2% Health care/pharmaceutical

2% Retail

1% Mining, oil and gas

1% Nonprofit

1% Telecommunications

18% Other80%

8%5%

8%


182017 New Zealand Telematics Benchmark Report

Teletrac Navman is a leading software-as-a-service (SaaS) provider leveraging location-based technology and services for managing mobile assets. With specialized solutions that deliver greater visibility into real-time insights and analytics, Teletrac Navman helps companies make better business decisions that enhance productivity and profitability. Its fleet and asset management technology uncovers information that would otherwise go unseen, helping customers reduce risk and confidently move their business forward with certainty. It tracks and manages more than 500,000 vehicles and assets for more than 40,000 companies around the world. The company is headquartered in Glenview, IL, with additional offices in the United States, United Kingdom, Australia, New Zealand and Mexico. For more information visit TeletracNavman.co.nz.

United States

2700 Patriot Boulevard, Suite 200

Glenview, IL 60026 · USA

Tel: [+1] 866.527.9896

Australia

Ground Floor, 16 Giffnock Avenue

Macquarie Park NSW 2113

Sydney, Australia

Tel: [+61] 2 9886 8500

Mexico

Av. Eugenio Garza Sada No. 3820 Piso 6

Colonia Mas Palomas

C.P. 64780 · Mexico

Tel: [+52] 81 8248.4600 ext 1001

New Zealand

7-11 Kawana Street

Northcote, Auckland 0627

Tel: [+64] 0800 447 735

United Kingdom

Keele University Science Park

Innovation Centre 2

Staffordshire, ST5 5NH · UK

Tel: [+44] 0 1782 55 79 50

Documents

2 017 TELEMATICS BENCH MARK REPORT NZ€¦ · The slow increase in New Zealand’s pool of commercial ... global annual average of 6-7 per cent.2 ... In a competitive market, telematics