Opinion

Managing a team on the road: Rise of the connected car

6 min read

24 May 2016

Innovation around the Internet of Things (IoT) has been gathering real pace this year. It’s a “quiet revolution…whose time has finally come” according to the Economist Intelligence Unit (EIU), which produced a 2013 report found that 96 per cent of business leaders expected their businesses to be using IoT in one form or another by 2016.

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It remains to be seen if the promise of the report has matched the reality. But whether we’re talking about intelligent street lights in smart cities or connected fridges that know when to make the next supermarket order, the future of technology is internet connectivity to everyone and everything.

The applications for IoT are spreading beyond our homes and offices. We’re starting to see the “connected car” become a reality for commuters and business drivers. Telematics technology, once considered quite niche, is becoming more widely understood, with businesses of all sizes adopting the technology to better manage their vehicles.

At RAC Business we’ve seen companies ranging from leasing firms, events businesses and private hire taxi firms connecting their vehicles. This is because whether you’re talking about fleets of five or 500, the data that can be retrieved on vehicles, their drivers and the journeys they are making is enormous.

This connected vehicle technology has shifted from being the tool that was used simply to track employees, to having potential to deliver business benefits across a range of areas such as saving on fuel costs, reducing wear and tear, and improving driver behaviour leading to fewer accidents.

This will also have a significant impact on insurance, and in particular usage based insurance. Until now pay-as-you-drive insurance has largely been marketed at young drivers with high premiums in the personal insurance sector. Now insurers are beginning to look at its application for businesses.

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So much data is available in real time on miles driven, speeds, locations and accident detection, that insurers can gain a detailed view of the risk profile of each driver and gain much better insight into how that vehicle is being treated.

It is also being used by businesses to help disprove liability for driving offences, potentially saving thousands of pounds in fines. Research by RAC Business found that more than a third of businesses in the UK have used telematics data to contest a speeding fine or a false insurance claim.

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If the data is being presented in court, then it needs to be reliable and the best systems on the market are those that can provide an accurate report, even at low speeds where incidents are often disputed. It’s something that we’ve made real progress on, with our technology achieving an industry-leading 92 per cent accuracy rating according to the Transport Research Laboratory.

But despite the obvious benefits there has been some reluctance to exploit all it can bring because of issues surrounding personal privacy.

Further research by RAC Business revealed that 40 per cent of businesses found that staff had concerns about the possible intrusion into their privacy associated with 24-hour tracking systems. And one-in-five had taken the decision not to use telematics as a direct result of those concerns.

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It is easy to understand why people do not want their every movement tracked when they are not at work, after all a vital part of the work-life balance is being able to switch off when the working day is over.

The key to all of this is communication, it is important to talk to staff and to explain to them the firm’s position as well as the advantages that the technology offers to all concerned.

As we look ahead to the very near future, we can expect telematics to continue to evolve and introduce further benefits such as data showing vehicle diagnostics and vehicle health. We see the technology underpinning company car drivers’ entire motoring world by connecting up all services.

The pace of innovation in the world of the connected car is ramping up, especially among business fleets. It’s an exciting time for the industry and the possibilities that this technology will bring throughout this year and beyond.

Nick Walker is MD at RAC Telematics

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