Annual Running Costs Of The UK Fleet Parc Now Top A Staggering £132 Billion

New MORI poll shows that fleet managers are concerned about high running costs - many of which could be reduced by adopting telematics systems

Running costs of the UK's car, van and heavy goods vehicle fleets are now topping a staggering £132 billion per annum. Fuel costs in the UK are the highest in Europe, some 45% higher than our European neighbour Belgium, and high vehicle excise duty and insurance costs do nothing to ease this crippling burden.

Only 8% of Fleet managers interviewed use a Telematics system

Against this backdrop, a recent survey of Fleet managers conducted by MORI on behalf of Fleetstar Information Systems, a division of Trafficmaster plc, revealed that only 8% of those interviewed used some form of Telematics system, yet 91% of fleet managers are continuously looking for ways to reduce costs associated with managing their fleets. There is a misguided belief that such systems are expensive to purchase and maintain but Fleetstar has already shown that with a cost-effective product, significant savings can be made by even the smallest of companies - and for most, very soon after the system is commissioned.

The MORI Poll showed that when prompted on the benefits of a Telematics package, services like street level mapping, real time tracking, instant vehicle location and stolen vehicle tracking do have widespread appeal.

The top three areas where managers were most concerned to make savings were fuel consumption (86%), vehicle maintenance (79%) and insurance (71%). The cost (47%) and time (42%) of communicating with drivers and drivers' wages and expense claims (40%) were also highlighted as key areas of concern.

Traffic congestion a major cost issue

Around two thirds of managers (63%) believe that productivity would increase if their drivers could move more quickly between A and B, and half of fleet managers agree that drivers being held up in traffic congestion during work time is costing their company too much money.

Congestion, and therefore journey time increases, can have a major effect on fuel consumption costs - and less efficiency also means increased pollution. Seven out of ten of those who think that traffic congestion is a problem also think that it has increased in the past five years.

Interestingly, although there is a general lack of awareness of the benefits of fleet management products in the Telematics arena (only 8% claim to have a system), 39% of fleet managers would find electronic vehicle tracking and management reporting useful in helping to do their job better. 34% would also appreciate being able to real-time track their vehicles. These requirements have widespread appeal particularly among those with smaller fleets.

Chris Haynes, Chief Executive of Fleetstar said, "It's very surprising that so many fleets are still not turning to Telematics systems to help them manage their operations more cost effectively. A lot of fleet managers clearly find it difficult to comprehend exactly how useful these systems could be to their business so it's up to us to convince them - a further piece of research that we are conducting with the Cranfield Centre for Logistics and Transportation will soon help us do just that."

He continued, "This Fleetstar survey highlighted that those running large fleets feel that they can benefit more than a smaller operator. However, even for the smallest of companies, Fleetstar's low operating costs and ease of use are securing cost saving benefits for small fleets that translate directly to the bottom line within weeks. There is no doubt that Telematics systems can dramatically reduce the operating costs of UK fleets and to that end we will continue to work hard to raise awareness of this still new technology right across the fleet spectrum."

Fleetstar is one of the most technically advanced fleet management systems on the market, combining the ability to view both historic and real time activity on vehicle movements. With live traffic information on-screen input, the system operator can very quickly react to congestion and divert drivers accordingly. Existing users of the system are already making dramatic cost savings and in many cases, the introduction of Fleetstar is transforming working practises. The product has achieved the Institute of Transport Management's 'Award of Excellence 2001' for Innovation in Fleet.

MORI POLL SUMMARY - Current Issues Facing Fleet Managers

• 91% of fleet managers are looking for ways to reduce costs associated with managing their fleets.
• 33% of fleet managers with 20-100 vehicles would welcome real-time information about the location and whereabouts of their fleet vehicles. This rises to 48% of those with more than 100 vehicles and down to 21% of those with 20 vehicles or less.
• Traffic congestion is becoming a greater issue for business efficiency - journey times are extending and deliveries missed.
• 63% of managers believe that productivity would increase if drivers could get more quickly from A to B.
• 52% of managers think that their staff would benefit from live traffic information showing areas of traffic congestion on a map.
• 50% of managers agree that drivers held up in traffic congestion are costing their company too much money.

Important Cost Saving Target Areas

• 86% would like to make cost savings on fuel consumption, 79% on vehicle maintenance and 71% on insurance.
• 47% would like to reduce the cost of communicating with their drivers.
• 40% would like to reduce the cost of drivers' wages and expense claims.
• 36% would like to reduce overtime.

Information Source

MORI Poll of fleet managers for Fleetstar Information Systems. The Freight Transport Association.

Fleet parc cost per annum (Fleetstar estimates based on the FTA data):

Fleet running costs include Vehicle Excise Duty, insurance, depreciation, fuel, tyres, maintenance and business overheads.

Technical details

The survey was conducted by MORI on behalf of Fleetstar. The questions were asked in telephone interviews with 100 fleet managers between the 13th and 18th June 2001. The survey sample was supplied by Emap.