8 Sep 16

Telematics looms large for future of fleet in South Africa

South Africa is a leader in telematics, and the importance of the technology for the country's own corporate fleet sector looks set to increase over the next few years. Fuel economy and other future trends relate to the need to cut cost in a volatile economy. 
“Compared to other countries, South Africa is a relatively mature telematics market with a high market penetration”, says Mix Telematics. But that does not necessarily translate into widespread telematics adoption: “The market is generally cost-oriented. Full-scale, advanced telematics solutions will continue to be used by only a small number of fleet businesses”. 
Security focus
On the other hand, “the use of light, lower-end telematics solutions with basic fleet management features is likely to increase, due South Africa's economic climate. Security will continue to have a strong focus in the country, as part of fleet management for cargo protection, fuel theft prevention and stolen vehicle recovery”.
LCV manufacturers like Daimler, Scania, Volvo and MAN are offering their own fleet telematics solutions in South Africa, and the adoption levels are likely to increase over the next few years. 
Adding value
“Telematics operators are looking for innovative ways of adding value, for example by integrating their telematics solutions with other on-board systems to gain efficiency, both operational and in terms of safety”.
But telematics isn't the only topic likely to influence the future of fleet management in South Africa. Another is road safety. Both the government and the private sector are taking initiatives to reduce the high toll caused by accidents on South Africa's roads.
Big Data
Big Data will also become increasingly important – and here again, the link to telematics is obvious: “The data generated by telematics will enable fleet operators to make great gains in all areas of operation, including fuel savings, environmental benefits and safety”. 
But other trends likely to influence fleet management in South Africa in the near future are linked more clearly to the need to cut cost in an economy that is at times turbulent and volatile. 
Top of mind
“Fuel-economical vehicles will become more important”, says Fury. “Also, loan vehicles to reduce downtime”, and other services that reduce cost and optimise investment: “Dedicated service technicians, good discounts and great after-sales service”.
VWFS agrees that cost saving and cost efficiency are top of mind for all corporate customers. Its answer to their concerns: “Reporting is key, and creates great value to customers, as does the one-stop shop approach – and last but not least, digitalisation”.
Lagging behind
Absa has an interesting, somewhat dissident view regarding the evolution of vehicle technology in South Africa In terms of basic company car needs, the South African market has reached a plateau, the company says: “While there is local taxation on all new vehicles purchased in South Africa and a consciousness associated to CO2 ratings, with large corporates having international audited results, the South African market is destined to lag behind the rest of the world in terms of adopting more ecofriendly options. Electric vehicles and their current limited range with little to no re-charging network available in South Africa are currently not an option”. 
For the foreseeable future, Absa says, it will be domestic economic concerns that set the fleet agenda: “The combination of both corporate credit appetites, along with potential Government adjusted legislation where adjusted taxation components are changed, have a very weighted influence on the South African market”. 
Authored by: Frank Jacobs