Data has become the hallmark of fleet operations, and companies rely on telematics to gather information from individual vehicles and fleets. To improve efficiency and profitability, fleet managers rely on real-time information to get meaningful insights and measure key performance indicators. Telematics for fleets assists in gathering information that managers can use to meet operation missions. Read on to discover the meaning of telematics and the applications of a telematics system for fleet management.

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What Is Telematics?

The telematics definition explores the meaning of the two sciences that make up the word – telecommunications and informatics. Telecommunications is a branch of technology that facilitates communication through phone lines and cables, while informatics refers to information processing. Telematics became popular in the ’70s and refers to the combination of information technology and telecommunications. In fleet management, telematics means technology systems that use telecommunication components, wireless networking, vehicular sensors, and data dashboards for long-distance data transmission.


Telematics date back to the 1970s, when it was primarily developed for military and intelligence applications. For instance, global positioning systems were developed due to concerns about public safety to transmit data and improve road safety. Telematics systems owe their existence to breakthroughs in modern technology; machine-to-machine communication, GPS and the internet. Fleet managers use telematics for various applications, including vehicle detection and gathering information for business operations. Telematics improves fleet control and captures data from diverse vehicles. For instance, passenger-load fleet companies can rely on vehicle telematics systems to determine the number of passengers in each vehicle and maintain surveillance of cars.

Imagine an intelligent computer installed in vehicles to collect data and report every detail! That’s what a telematics system does. A vehicle telematics system records data on vehicle use, ranging from speed, fuel use, idling and low tyre pressure.

How Does Telematics Work?

A typical telematics system has a vehicle tracking device that facilitates the storage of telemetry data. The telematics devices are installed and connected to the vehicle onboard diagnostics (ODBII) to allow the sending and receiving of information. Some vehicles use a CAN-BUS port with an onboard modem and SIM card to transmit data through a wireless network. A telematics device collects an array of vehicle data and GPS information and uses a General Packet Radio Service for transmission. The server receiving the data interprets it and avails the information in secure applications or websites optimised for smartphones and tablets.

The vehicle telematics collects data generated from trucks, including:

  • Vehicle speed
  • Location
  • Trip distance and time
  • Harsh braking and driver behaviour
  • Fuel consumption and battery voltage
  • Vehicle faults
  • Idling time

After data is relayed to secure servers, it is decoded using the fleet management system for reporting and data analysis. Fleet managers can view information from the software and generate reports for business intelligence. For instance, fleet companies can identify drivers with speeding incidents or schedule vehicle maintenance and repairs from fault reports.

With the technological evolution, tracking telematics has moved from closed systems to open platforms. Unlike the previous systems, open platform telematics allows fleet managers to integrate various hardware accessories and software that provide insight into business operations and better efficiency. Popular telematics integrations include dispatching and route optimisation, remote diagnostics, dash cameras and electronic logging (ELDs).

How Are Telematics Devices Installed?

Most commercial vehicles come with embedded telematics technologies and GPS tracking devices. If the commercial truck doesn’t come with pre-installed technology, aftermarket GPS devices are available. The devices can be battery-powered or powered via the vehicle’s internal electrical system.

Installing telematics devices can be done without professional help. The process involves plugging the device into the vehicle’s OBDII, typically underneath the steering wheel. Once installed, the device collects and shares data via a cellular network. The installation process can defer based on the type of telematics system. They include:

  • OBDII telematics: These are the most common telematics devices plugged into vehicle onboard diagnostic ports. In the US, OBDII telematics became a requirement in all commercial vehicles in 1996. The comparable standard in Europe is the European Onboard Diagnostics (EOBD). Telematics systems have a proven track record of transmitting data and can be integrated with various software.
  • Bluetooth-powered telematics systems: These self-powered data transmission systems transmit data via Bluetooth. The device is attached to the vehicle’s centre console and can transmit a driver’s behaviour information.
  • Black box telematics system: Telematics in the UK began as a black box innovation, the acceptable standard for usage-based insurance (UBI). When the black box is securely installed inside the vehicle, it collects and transmits accurate trip and crash information to the data centre.
  • Smartphone-based telematics systems: The telematics device doesn’t require setup and uses a smartphone to gather and transfer data.

How Do Fleets Use Telematics Systems?

Fleet managers rely on vehicle telematics systems for various purposes, including:

  • Vehicle tracking: Telematics devices use a combination of GPS satellites and receivers, cloud computing, and GPRS networks to collect data. The GPS receiver downloads information from satellites and decodes them for use with navigation systems. Vehicle tracking allows fleet managers to monitor the location and movement of vehicles.
  • Asset and trailer tracking: Transportation companies that move high-value assets can attach GPS devices to trailers and other non-motorised property to monitor location. The tracking devices transmit information in real time, allowing customers to track deliveries from their smartphones.
  • Safety monitoring: Fleet operators use telematics to monitor and record the vehicle’s speed, location, and driving habits. For instance, harsh driving events and seat belt use can be monitored. Hence, fleet managers can identify areas of improvement in drivers’ behaviour to prevent accidents.
  • Maintenance improvements: Telematics track vehicle maintenance or asset lifecycle management. For instance, telematics can record hours of use and schedule maintenance based on vehicle diagnostics. By keeping tabs on performance, fleet managers can keep vehicles in safe and operating conditions like battery voltage, powertrain malfunctions, and coolant temperature.
  • Insurance risk assessments: Telematics data is used to monitor driver behaviour, which helps insurance companies determine risk factors when setting insurance premiums. Telematics can also report when a vehicle is used outside its geofence or designated area.

What Are the Benefits of Fleet Telematics?

Using telematics for fleet management helps logistics and transportation companies achieve operational efficiency, alongside other benefits, including:

  • Improved safety: Fleet managers can monitor data relating to driving styles like speeding or harsh braking. With the relevant information, drivers can be trained to drive safely. Some fleet operators use telematics information to reward good driving behaviour with safety scores and benefits. Since the collected data is accurate, fleet managers decide based on actionable data and support new safety targets.
  • Reduced fuel costs: Telematics identifies areas of fuel wastage and helps managers promptly address the issue. For instance, telematics data records engine performance and vehicle idling. If the driver leaves the engine running for a long time or has poor driving habits leading to fuel wastage, fleet operators can quickly address the issue to improve fuel efficiency. Optimising routes by minimising longer routes can also improve fuel efficiency.
  • Better productivity: With telematics, fleet operators can combine live traffic data with vehicle GPS systems to guide drivers and offer suggestions. Drivers can avoid traffic delays or bad weather, reducing the journey time. Relying on telematics information makes the workforce efficient and productive since workers can complete more tasks in less time.
  • Maintenance: Telematics data provides insights into the journey time, tyre pressure, temperatures, and vehicle conditions useful for car diagnostics. Fleet managers use insights into component degradation to book maintenance and repairs. That means vehicles will be off the road for fewer hours. In case of vehicle faults on the road, the fleet manager receives notifications from the OBDII system.
  • Tracking working hours: With telematics data, fleet managers can track the precise working hours of every employee. It records the exact time a vehicle starts and the moment it shuts down. It also provides an automated record of breaks that drivers take, making it easier to calculate remuneration. Telematics systems reduce time spent matching job tickets to timesheets to identify working hours.
  • Emergency assistance and instant accident notifications: Telematics systems are built to identify crashes or collisions and immediately request emergency services. Crash-proof telematics devices send out location data for the vehicles. Fleet companies can also program live alerts to the telematics systems to help drivers find nearby restaurants or truck stops and receive weather alerts. The alerts are sent as push notifications and eliminate the need for drivers to use their phones on the road.

Are Telematics Systems Expensive?

The fleet management solution influences the costs. For instance, telematics with bare-bones GPS tracking is affordable but provides minimal actionable insights. Fleet operators prefer a fully integrated telematics solution with additional features for better route planning and fleet tracking. While fully integrated options are expensive, they provide a bigger return on investment. Fleet managers get better fleet visibility, customisable dashboards and real-time fleet analytics.

The Future of Telematics for Fleet Management

Telematics will continue to grow as modern GPS units are developed and new technologies are integrated to improve data monitoring. Transport and trucking companies recognise the importance of monitoring fleet activity and are willing to invest in fully integrated telematics systems to boost productivity, maintain compliance, and improve accountability. With the advancement of 5G technology, telematics systems can transfer data even faster, providing actionable and real-time information, such as live fuel consumption and routes. Combining telematics systems with machine learning and artificial intelligence will further improve productivity and vehicle monitoring.

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