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Industry Outlook

The brief was simple: Find out what is happening in the vehicle tracking, fleet management and on-board computer market. For the most part , the answers we picked up from the supplier were quite positive. Dare we say it? After years of trial and error, the signs are there that this industry is at last reaching a level of maturity. In spite of a number of casualties and some interesting strategic alliances and amalgamations taking place over the last year, there is definitely a degree of stability in the marketplace writes FleetWatch correspondent Andrew Parker.

Some of the bigger players have dug their heels in, sorted out niggling teething problems and are now presenting acceptable levels of product and service. Major systems are are now into their third and fourth generation and are generally stale and reliable. Of the casualties over the past year, the more visible of these was Q-Fleet which took a dive. There are numerous reasons behind the demise of what was a high profile company. Mostly it's pure financial. It is a tough market and if a company is not selling enough product to keep the shareholders happy, the plug is pulled. It is not as if the product is inferior.

More recently, Astrac the Roadcorp-owned and operated vehicle tracking and fleet management system has been restructured, the result of which is the formation of yet another new fleet management company which will operate under the name of Logisco. No finite details were available at the time of going to press although FleetWatch understands Roadcorp will retain an interest in the new company. Although it has not been confirmed, it is believed that the reason behind the liquidation of Astrac was that is was draining valuable resources and capital form Roadcorp's core business. Then there are those mergers. It appears that some tracking companies are joining forces with fleet management service providers in order to offer a wider range of services. While this may sound all very well in theory, Geotab MD, Basil Papalexis, has voiced some concern over the trend saying there is conflict between the two technologies: "Recovery operations require strict security whereas the transfer of fleet management data does not."

There is more to the story than this,Papalexis says he has found that both recovery specialist and fleet management suppliers each thinks the other is doing well while both sided are in fact struggling: "Quite often a merger is a survival tactic although the merging parties will deny this claiming they are taking a total solutions approach'."

Apart from technological conflict, Papalexis feels some of these merged companies will at best be able to offer a bit of security and bit of fleet management. "Apart from the fact vehicle tracking is the common denominator of both security and fleet management, the design parameters are completely different. Unless the complete system is carefully managed, the customer is not going to get what he needs."

Another development of fleet management bureaus. While it is too early to say whether this become a trend or not, bureaus sees fleet operators outsourcing the collating and translation of fleet management information to a third party. Fleet Data Management information of a joint venture company comprising AMT Technologies, Mac Design Technologies and Fleet Focus. FDM is part of the Intella Fleet stable which, in turn, is a wholly-owned subsidiary of the Cape Empowerment Trust.

General manager Dave King says bureaus will supply fleet managers with exception reports and any other information they require. King reports that FDM has an established data-base of 640 vehicles spread among ten clients. While these are currently confined to Intella Fleets' clients, he says there is nothing stopping them collating data for any fleet management system provider. "Their idea is to present vehicle information and provide management solutions to any problems the fleet managers experiencing in running his fleet." King adds that Intella Fleets' software package has been upgraded to provide more graphical, user-friendly information: "We identified that after a while the clients were not reading and using the information they were being provided with so we are trying to make it easier for them."

He also clains that Intella fleet is at the forefront of the vehicle and fleet management industry. "We offer a variety of complimentary products such as engine and fuel management systems, vehicle tracking and fleet management. Our systems are being used in a variety of applications, from passenger cars, bakkies, trucks, mining and heavy equipment and so on."

The company also has an extensive export program in place and had just signed a deal to provide a 7 500 vehicle San Antonio-based fleet with tracking and fleet management systems. If the application is successful, King says it will give Intella Fleet access to the fleets' other vehicles , some 55 000 of them spread over a number of States.

Nice to see local technology hitting the big time. We hear fleet management suppliers Digicore is also having some success in the foreign markets with better than expected sales in Asia and Australia. Matrix Vehicle Tracking is also branching out into overseas markets and will be opening an outlet in Australia in January next year. "Our objective is to open eight to ten new markets every 12 months,"says MD Stefan Joss.

On the home front, Altrac director Etienne an Jaarsveld says there remains a huge untouched market both locally and regionally. "Within two or three years professional fleet operators will not be able to compete effectively if they are not equipped with the latest fleet management systems, "he says. If he is right, this will compound the future growth of the industry.

Commenting the proliferation of players which continue to be a thorn in the side of established players, Van Jararsveld says this is relatively simple to develop a fleet management system and get into the market. Anyone can do it. "However, because of this we feel there is a danger that existing communications channel could become oversubscribed. This is why we will retain our own protocol. Moving to radio trunking, ComTech MD Brian Edmonds says after 12 years at the helm, he has seen a host of 'wannabe' fleet management and vehicle tracking specialists come and go.

"There has been a serious problem of sustainability of players into the market, " he says which is something of an understatement if you consider three to four years ago the market was awash with vehicle tracking and fleet management specialists.

Edmonds says because trunking uses a radio signal there is a perception that it is old technology: "Nothing could be further from the truth. Radio trunking is enjoying significant growth all around the world, with Canada, Eastern Europe, South East Asia and Australia being the most notable. Taiwan is currently opening up a new radio trunking network in that country and is negotiating with ComTech for use of its software programme judged to be among the best available anywhere in the world."

These are just some of the comments around trends taking place in the market. The bottom line is that the transport operator is in the pound seats. Sure there will always be argument among suppliers in what the most appropriate system is but the fact remains, South African transport operators now have some of the best systems in the world available to them. What they need to do is define their exact needs and then select the most appropriate system to meet those needs.

And don't hesitate to get the suppliers in and grill them. A number of companies have advertised their services and offerings in this supplement. Call them in.