The Car and Truck Fleet and Leasing Management Magazine

State-of-the-Art Fleet Technology: Fuel

February 2017, by Chris Wolski - Also by this author

Photo courtesy of istockphoto.com
Photo courtesy of istockphoto.com

Editors Note: This article is part of a four-part package that addresses state-of-the-art fleet technology. Read related articles that offer an in-depth look at safety, telematics, and on-the-horizon techology.

It probably comes as no surprise that fuel continues to be, along with depreciation, one of the top expenses for fleets. Over the past few years — thanks, in part, to the Great Recession-era fuel price spikes — many fleet managers have used technological advances to shave dollars off their fuel costs such as by downsizing to smaller, more efficient engines, and adopting anti-idling technology. So-called “eco-driving” techniques have also been employed to coach drivers on how to drive in the most fuel-efficient manner.

Subject matter experts representing a sampling of some of the technologies fleet managers are using today to shave their fuel bills share their thoughts on today’s state-of-the-art fuel technology, how it’s building off previous technology, what it means for fleets’ bottom lines, and what might be around the corner.

State-of-the-Art Fuel Technology

Much of the state-of-the-art fuel technology is available right now.

Ron Katz, senior vice president, North American Sales for Chevin Fleet Solutions said that there are numerous individual technologies that will help specific fleets and vehicle types, but there is one thing that applies to all of them: better use of data analytics.

At a Glance

Fuel continues to be one of the biggest fleet expenses, but technology is aiding fleet managers in shaving additional pennies off this cost center. Among the ways fleets are using technology to save fuel:

  • Increasing their use of data analytics.
  • Involving the driver.
  • Turning to older technology, such as RFID.

“Universally all fleets can benefit from more effective fuel management and purchasing practices driven by management and analysis of accurate, up-to-date and actionable data,” he said. “Fleet management software serves as a central repository of that data and continues to be one of the leading technologies available to the market to help organizations achieve real, measurable improvements to their fleet operations. This software is a must-have tool if a fleet is to effectively, quickly, and easily analyze fuel usage, fuel costs, fuel sources, and fueling practices, and use that information to reduce consumption.”

Kurt Thearling, vice president of analytics for WEX, added that this increased ability to analyze data is giving fleet managers unprecedented views of their fleets’ fueling behaviors.

“Key tech trends in analytics — more and better integrated data as well as improving Big Data tools — are providing fleet managers with an ability to understand fuel-spending behaviors in ways that have not been possible in the past,” said Thearling. “I like to think that most important data points are the ones with dollar signs next to them, and the sheer magnitude of fuel spending means that fuel data is critical to efficiently managing a fleet.”

Thearling noted that technology is not a panacea. There’s an important mindset that has to be adopted by fleets and the companies they serve.

“It goes beyond simply collecting some data and buying some tech. It gets down to the culture of the fleet organization, and how they use data to answer important questions,” he said. “The organizations that do this well — think Netflix in the consumer space — are the ones that have created a culture around working with data to generate insights. It can start out small, with a couple people actively working with data and data science tools, but then find a way to evangelize the successes within the organization, and encourage more members of the fleet team to develop skills in this area. After a while, you will have a community with a shared vision for how analytics can be used to turn all of that fuel data into a way to better manage a fleet.”

The combination of telematics and fleet program data will continue to grow, according to Marie LeMoine, U.S. Bank fleet and aviation group product manager.

“In 2017 we will keep finding better ways to integrate all of that data to get greater benefit from it. As fuel card providers, we are working with telematics companies and others to develop solutions that make data even more actionable. An example would be our newly enhanced Voyager Fleet Card that simplifies overall fleet management,” she said. “Historically, cars and light-duty trucks have been served by one type of fuel card program, heavy-duty commercial rigs by another. For mixed fleets, consolidating and analyzing data across programs in a consistent manner has been a nightmare, and making multiple payments on varied credit or payment terms has been cumbersome.”

This integration into a single can have a number of benefits for the fleet, according to LeMoine.

“By integrating into a single-card program, organizations get a holistic sight line for managing all types of fleet expenses. They can take advantage of incentives for volume-based purchasing and fully leverage their buying power in the marketplace,” she said.

For Joe Basile, VP of fuel technologies for AssetWorks, the biggest state-of-the-art fuel technology has been around for decades.

“What I am starting to see as the most exciting/cutting edge is not new technology — it is the acceptance of technology that has been around for decades. This technology is RFID in fuel management,” he said. “I started in this business back in 1989 working for a startup company that had secured the exclusive rights to distribute the first RFID fuel management system in North America. Here I am 27 years later, with at least five viable competitors that have also been promoting this technology for years — and I will now say that the North American market has finally started accepting RFID technology as the next progressive step in securing fuel dispensing and managing data over the card or key-based fuel management systems that have been around even longer.”

While an older technology, RFID has kept up with the times.

“The advancements that many of us have done in the industry over the last few years — the incorporation of passive and active GPS solutions to the existing RFID solutions — are providing more choices to our end users,” he said.

RFID technology answers an important need for fleets, automation, said Kevin DeVinney, marketing director for Gasboy.

“We’re seeing RFID technology that will authorize the fueling for that vehicle, so drivers don’t have to type in the vehicle number or the odometer, so automating that part of the fueling process,” he said. “The system already knows the vehicle and the driver, the odometer reading, and if there are any error codes.”

The Evolution of State of the Art

DeVinney noted that in the case of fuel technology, the market is primarily evolutionary not revolutionary.

“A lot of times we struggle with the implementation of technology, because for commercial fleet managers fuel is something they don’t sell and they need it to run their business,” he said. “When you look at how some fleets handle fueling its 1970s or 1980s technology.”

In other words, in terms of fueling many fleets are catching up to technology already available, making it the state-of-the-art technology of today.

And it’s not just technology such as RFID that’s gone through an evolution. Data analytics has evolved into the fleet fueling market as well, as Thearling of WEX observed.

“Other industries like financial services and telecommunications have been actively using analytics for decades,” he said. “What is new is the bringing together of new data sets, along with a lot of new cloud-based processing capabilities. But the data analysis techniques are fairly well established, which in some ways is a good thing. Borrowing good algorithms and technology allows fleet managers to quickly take advantage of learnings that have been developed over the years in other industries.”

Katz of Chevin Fleet Services agreed that there hasn’t been much in the way of new data analytics technology per se. What is new is the level of integration that fleets are doing with this data.

“Data from on-board telematics, fuel card and fueling systems, services vendors, driver management solutions, and others can be integrated with fleet management software,” he said. “The ability to view a wide range of data in a single, powerful system and easily set KPIs, create reports and even automate alerts and processes enables organizations to keep track of their fleet and other assets at all levels — and ultimately make better operational decisions.”

Improving Fleet Operations

The decision to adopt a state-of-the-art technology by a commercial fleet manager should be guided — at least in part — by how it will help to improve fleet operations, particularly the bottom line.

For instance, Tom Kanewske, vice president of business development for Derive Systems, noted that his company’s engine calibration system will provide the most benefit to those who are most affected by fuel price volatility.

“The technology will see greatest adoption by those whose margins are most affected by vehicle O&M, like sanitation and long-haul trucking,” he said. “However, any sudden changes to international oil supply that forces spikes in prices at the pump will quickly improve adoption by preponderance of other fleets.”

Katz of Chevin Fleet noted that one thing state-of-the-art technology can do is combat that age-old fuel management scourge — fuel fraud.

“Whether it’s about filling a non-fleet vehicle during an authorized transaction or inflating business trip mileage, fraud is a costly fact of life for many fleets but fleet management software can be used to help identify incidents,” he said. “For example, fleet management software can be used to compare a vehicle’s fuel tank size and average fuel economy to the amount of fuel purchased, and automatic alerts can be set to indicate any discrepancies. The software can also be used to compare driver and vehicle mileage information to data integrated from telematics systems that use GPS to record ‘start’ and ‘end’ locations for each trip.”

Surprisingly, Thearling of WEX sees the human factor as the crucial element for improving fleet operations. The technology is simply a tool to make that process more efficient.

“Analytics will resonate with fleets if the insights that are extracted from the data can be turned into action. An insight, by itself, is not all that valuable. You need to act on the insight,” he said. “If you have drivers who are behaving in a way that wastes a company’s fuel budget, all the insights in the world won’t make a difference if you can’t actually change the driver behaviors. Get them to stop buying premium fuel, have them change their route to take advantage of lower cost gas stations.”

Technology can be the means to hammer home the message and keep drivers accountable.

“Automation can provide an efficient way to continuously nudge drivers and change behaviors,” he said. “Use analytics to identify the drivers and behaviors that are a concern, and then automatically reach out with messages to encourage changes. Then watch. If the behavior changes, then great, but if it doesn’t, the system can automatically follow up, possibly with a more emphatic message. In the end, you want to turn the follow-through into a well-oiled machine, continuously adjusting as new data comes in and identifies something important.”

Automation is one of the key benefits of state-of-the-art technology, DeVinney of Gasboy noted.

“What automation does is make the operation more efficient,” he said. “If I have a driver going up to a fueling station, put the nozzle in the tank, pump the fuel and go, and I get the data sent to me and they don’t have to do anything — they’re not there long, I get good clean data I can act on.”

Echoing Thearling and Devinney, LeMoine of U.S. Bank sees fleet fuel technology as a means to improve driver behavior and efficiency.

“The goal of utilizing data should be to enable managers and drivers to maximize useful information, avoid distractions and gain efficiencies,” she said. “Human brains can integrate many, many types of data in a given day, but the more we are asked to account for, the less granular we can get in deciding relatively basic questions such as ‘Where do I fuel?’ Part of our job is to provide the broad visibility and granularity fleets need to make better decisions without having to do all the research, compilation and analysis themselves.”

Basile of Assetworks agreed that the driver was crucial in having a successful fuel program.

“As we are all aware, we have absolutely no control over the price of fuel; however, by implementing sound practices around fuel and driver management, we do have the ability to control how much fuel is used,” he said. “As fuel is often one of the largest costs in managing a fleet, it has become imperative over time that just controlling the dispensing of fuel is no longer the only item needed for a successful fuel management program. Adding the driver into the equation and how and where the vehicles are driven is yet another ingredient to success.” 

Looking Ahead

As with any discussion about state-of-the-art technology, invariably the question of “what’s next?” comes up. For fuel technology the next five years may see a bigger combination of evolutionary and revolutionary changes than any other area touched by fleet.

LeMoine of U.S. Bank sees the changes as being primarily evolutionary, but with revolutionary consequences for the way fuel is bought and tracked.

“We expect to see the enhanced security of ‘chip’ technology making strides, both in so-called EMV cards and in mobile devices themselves,” she said. “We will see cardless or ‘virtual’ payments becoming easier and more convenient. We will even see vehicles themselves become payment devices — a touch of a button on the steering wheel will transfer the money. And continuing advances in telematics will enable even broader integration between fuel payment and other vehicle technology resulting in increased visibility and actionable data.”

Kanewske of Derive sees data dominating. “We’ll have data-driven, data-shared technology, and an open architecture that can evolve,” he said.

DeVinney of Gasboy sees more integration of fueling data and telematics on the horizon.

“There’s been a trend of more of a collaboration of different pieces of equipment to gather data,” he said. “For instance we’ve always had telematics that would provide vehicle location and we provide the fuel access control data, and those types of data are coming together. It really gets into what we’re going to see in the next five years with the connected vehicle, making the vehicle a central repository of data.”

Katz of Chevin Fleet Solutions and Basile of Assetworks see the next step in state-of-the-art technology will involve new fuel and energy types.

“Electric cars are here to stay, light- and medium-duty trucks can employ similar technology and there’s even the recent unveiling of the hydrogen-electric Class 8 Nikola One truck,” Katz observed. “Not only is the technology employed by EVs now advancing more rapidly, the advent of extended-range capability and the development of a charging infrastructure to support their operation all point to electric power as the wave of the future. Regardless of the source of the ‘horsepower’ though, fleet management software can help improve utilization, efficiency and productivity.”

Basile doesn’t expect that the proliferation of EVs will change the way fleets are monitoring fuel use.

“Today, our fuel management systems are utilizing the technology we mention above to provide the same data on electric vehicles — such as meter readings, engine measurements and fault codes, percent of charge left in battery, etc.,” he said. “While users of our fully integrated fleet and fuel management solution are able to simultaneously control fuel costs while keeping vehicles running optimally, we are also working toward the marriage of charging data with our FleetFocus fleet management solution, which would enable fleet managers to maintain a total cost of ownership with electric vehicles and energy consumed.”

Thearling of WEX sees the next evolution in fueling technology making way for the autonomous vehicle.

“We’ll start to see changes that anticipate autonomous vehicles,” he said. “Self-driving cars might still be a ways off, but the infrastructure (fueling, roads, etc.) will start to change to support what will be happening over the long term.”

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