What is Telematics Data and Why is it Important?

Gretchen ReeseNovember 16, 2021

We’ve all heard of the term telematics data right? 

It seems to be one of those things that as you enter the fleet industry – or actually, I should probably say the automotive industry at this point – it’s engrained in you from day one. But what actually is it aside from the collection of data points from a vehicle?

Why is it useful? Why is it still worth the hefty investment in the technology to collect it?

Well, my friends, that’s the question I’m here to answer today.



What is Telematics Data and Why is it Important? | Fleet FYIs Podcast, Season 2 Episode 37

Gretchen Reese (00:06):

Hey there. Welcome to Fleet FYIs, the weekly podcast by Utilimarc that reveals how you can make the most of your data for smarter fleet management. My name is Gretchen and every week you’ll hear from me and some of the industry’s finest in candid conversations that will shed some light on not only two decades worth of data insights, but some of the industry’s hottest talking points and key metric analysis with the aims help you better understand your fleet from every angle.

Gretchen Reese (00:33):

But before we begin, if this is the first time you’ve heard our show, thanks for stopping by. I’m so glad you decided to come along for the ride with us. But I’ve got a quick favorite to ask you, once you’ve finished today’s episode, if you could take a few minutes to leave us a review on your favorite podcasting platform, we would really appreciate it. Give us a rating, five stars I hope, or tell us what you liked or leave us a comment or a question about what you’ve heard in today’s episode. But if we haven’t yet covered a topic that you’re interested in hearing more about, let us know. We would be happy to go over it in detail in a later episode. If that sounds good to you, let’s get back to the show.

Gretchen Reese (01:17):

Hello everyone and welcome back to another episode of the Fleet FYIs podcast. We’re back today with another episode of the shorts version of the show, and it seems a little strange recording this show today as it’s Tuesday and not a Monday. But if you would’ve listened to the episode that went live yesterday, you’ll have heard all about the Utilimarc team’s experience at the Fleet Forward Conference of last week, which was really exciting. So, if you haven’t listened to that yet, make sure you add it to the queue for after this one.

Gretchen Reese (01:48):

But for this show, I wanted to talk about a term that you’ve probably all heard before, right? And at least I feel like I’m going out on not too far of a limb here to say that we’ve all heard of the term telematics data, right? It seems to be one of those things that as you enter the fleet industry, or actually, I should probably say the automotive industry at this point, it’s ingrained in you from day one, what it is. But what actually is it, aside from the collection of data points on a vehicle, do we all really know? Why is it useful? Why is it still worth the hefty investment in the technology to collect it? Well, that’s hopefully the question that’ll be answering for you today. Let’s dig in.

Gretchen Reese (02:42):

So, let’s start with the basics here. What exactly is telematics? Well, telematics is a real time data collection technology that helps fleet managers to analyze a vast range of information across all vehicle types and all asset types within their fleet. It’s a powerful tool that connects fleets of all sizes and actually allows fleet managers to track vehicle location, driver behavior, monitor engine diagnostics remotely, and do it all entirely on one platform, if you do it right. Let me paint a bit of a picture for you. So, in order to get a better right idea of what I’m trying to describe here, because I’m aware that for some that might not make a lot of sense, or it might be hard to picture, try to imagine a highly intelligent computer inside your vehicle that’s able to report on nearly every detail that you can imagine. Kind of like how our smartphones work inside of our pockets, tracking all sorts of data just by being flipped on and easily accessible for use. Which sounds a little creepy when you think about it that way.

Gretchen Reese (03:43):

But anyways, telematics devices work in a very similar way. The information that’s collected from your vehicles could mean saving many typical cost sinks from actually even being introduced into your budget. For example, maintenance costs by better monitoring vehicles and scheduling vehicles for predictive maintenance, rather than having the oops, big maintenance bill. Or improving fuel efficiency by learning more about driving habits and better planning routes used or where charging and fueling infrastructure may be located. But how exactly is this information collected here? Well, I’m glad you asked.

Gretchen Reese (04:16):

Well, I should say, I guess I’m glad I asked for you because we’re not actually having a conversation (laughs) here. But in order to collect information from your vehicle, a small telematics device is plugged into the OBD2 port or the CAN bus port. Now what this is, is an onboard computer that monitors emissions, mileage, speed, and any other data point about your vehicle that you can imagine. It’s connected to the check engine light, which I’m sure we’ve all seen pop up on our dash, at least some point in our lives, and that light actually illuminates when that particular part of the computer detects a problem.

Gretchen Reese (04:49):

The OBD2 port that is part of that onboard computer features a 16 pin port located underneath the driver’s side dash. And a connected SIM card and a modem inside the telematics device that’s connected into that little port like I mentioned earlier, enables the vehicle to telematics platform communication that takes place on a cellular network. It’s not something that’s done through an ethernet cable, meaning like you don’t have to drive your vehicle back to the fleet yard, plug in a cable to get the data, but you do have to have that particular device installed into your vehicle before it can communicate wirelessly with the platform itself. And the telematics device inside your vehicle, like I said, it retrieves data generated by the vehicle itself. So, this is where we’re starting to look at things like GPS positions, speed, engine light information, and a variety of fault codes.

Gretchen Reese (05:41):

Other data point points like trip and distance time, idling time, harsh breaking and driving, seatbelt use, fuel consumption, vehicle faults, battery voltage, all other types of engine data each and every one of these are also monitored and they each carry an important perspective as to how vehicles or specific drivers are performing. But I’m sure you’re probably wondering at this point, okay, Gretchen, that’s a lot of data and that’s all really great, but how do fleets actually use this data source? Because that’s a pretty big part of this too. You can’t just collect the data and do nothing with it. Then it may as well be useless.

Gretchen Reese (06:29):

One of the many ways that fleets can use this collected data to optimize their operations is due simply to the heightened level of awareness and communication that it brings. And that might seem a little bit fluffy when you first start out, but the thing is, is without telematics, fleet managers often rely on drivers to communicate vehicle issues who could easily miss or fail to report a check engine light or a similar reporting event. And with telematics technology, fleet managers can actually receive instant notifications on when vehicles need maintenance, drivers have a speeding or a safety incident, a vehicle is down or a need of assistance, and they can see to these issues immediately instead of letting time pass and worsen vehicle conditions. That’s the biggest thing. That’s where that heightened awareness and that heightened communication comes into play. Another common way that fleet managers are using telematics data is actually to identify waste reduction opportunities.

Gretchen Reese (07:22):

And this is where my ears perk up a little bit, because we all know that I’m a big fan of sustainability over here on this show. And again, just because every single time I mention sustainability, I like to sound a bit like a broken record in this case. But when I say sustainability, I’m not just talking about electric vehicle and getting rid of all of your internal combustion engines. That’s not it at all. In fact, sustainability at its core really just means to prolong the life of your fleet or of your organization for as long as possible, and making sure that your operational strategy is as sustainable as possible, meaning it can keep going and going and going. So, whether that includes electric, whether that includes alternative fields or just simply being more sustainable or more eco conscious with your internal combustion engines, doesn’t really matter.

Gretchen Reese (08:07):

But I digress because I’m getting a little bit off topic here. The ability to collect so much data, and we’re talking back to how fleet managers can use this to reduce, um, waste opportunities here. The ability to collect so much valuable data also allows data management teams to identify areas for improvement that could greatly reduce a fleet’s carbon footprint, which is very exciting. Observations regarding waste reduction, fuel consumption, and idling time can actually help folks in the management team to identify where and when and how they can do better, and fuel and efficiency and waste is actually one of the biggest problem areas in managing a fleet, and probably one of the costliest. Not sure if you knew that one, but that’s kind of an interesting aspect to this conversation.

Gretchen Reese (08:53):

And many driver behaviors, believe it or not can actually lead to greater fuel consumption that would be nearly impossible to detect if not for telematics technology. Harsh acceleration and speeding causes vehicles to burn more fuel in addition to the obvious dangers of unsafe driving. And similarly, the time that a vehicle is in idle actually adds up in great measure and can contribute greatly to fuel consumption and harmful gas emissions, which we did a show all about greenhouse gas emissions a couple of weeks ago. Make sure you have a listen to that one if you haven’t already. But according to the US Department of Energy, an idle heavy duty truck can burn up to 0.8 gallons of fuel per hour. With a long haul truck averaging about 1,800 idle hours per year, this means roughly 1500 gallons of diesel along with thousands of dollars per truck are being flushed down the drain. Not to, not to mention the amount of emissions that are also being put out there.

Gretchen Reese (09:47):

The US Department of Energy also estimates that that less period idling results in about 11 million tons of carbon dioxide emissions. There’s that kicker right there that I was just talking about, among other toxic pollutants every single year in the United States alone. It’s clear how this driving behavior, at least I think, that seems small scale and insignificant on a single truck basis can quickly add up and contribute gra- gravely to crim- to climate change. Waza, it almost seems like a Monday on a Tuesday and air pollution. But being able, I think, to identify these behaviors as areas for improvement allows managers to limit idling time, lower emissions, and potentially cut fuel consumption. And that’s a big part of this, right? This is why we’re all trying to look at our fuel consumption strategy. It’s not just about saving money, but it’s about how we can actually do better for the environment and the communities that we’re a part of.

Gretchen Reese (10:39):

Now, the last benefit that I will touch on in this episode before I wrap up that fleet managers can access from digging into their data is pinpointing the most optimal routes for their vehicles. And this is something that I kind of touched on earlier on in the show. This is where I was referring to the optimal fueling or recharging points, um, or even just better route planning. Well, the thing is, is telematics is a key tool in helping fleets identify routes that could be more direct or reduce bottlenecks at job sites, both two very important things. And actually, if it was up to me, the results kinda speak for themselves, because it boosts fuel efficiency, it saves drivers’ time.

Gretchen Reese (11:17):

Potentially this is all (laughs) theoretical, right? And it is also reducing carbon footprint overall for the organization. It can even actually help fleets looking at pursuing electric initiatives. Like I said, when it comes to planning out optimal routes, because then you can figure out, you know, just where you’re gonna install your charging infrastructure, where the charging station locations will be. Um, whether it’s at a fleet yard and at home charging policy, or even somewhere along the routes that you most commonly take, which could potentially lead to a successful push for fleet electrification. You never know.

Gretchen Reese (12:01):

What I’d love to know though is, do you use telematics in your fleet management strategy or did you know that the use of this data point is a lot more common than a lot of people think? Let me know what your thoughts are. Send me an email, tag me on LinkedIn or use the #utilimarcfleetfyis. I am looking forward to hearing from you as always. And also just to keep in mind, if you do have any questions that you would like to have answered on fleet FYI shorts, which is typically except for today, (laughs) because today is Tuesday when this episode is coming out, but typically they are on Mondays. They, I like to say, our bite size fleet FYIs episodes for folks that are on the go and have 15 minutes or less to catch their weekly dose of fleet FYIs.

Gretchen Reese (12:40):

All the top questions surrounding, um, the fleet industry, any type of topic that you could possibly think of, send them my way and we try and answer them on the show every single week. But aside from that, make sure you tune in for Thursday’s episode of the Fleet FYIs podcast. That is our longer show that happens at the end of the week, every single week and it’s surrounding the expansion of the world’s largest ultra low emission zone and what that means for fleets and the consumers that operate and drive within it. But until then, that’s all for me, ciao.

Gretchen Reese (13:13):

Hey there, I think this is the time that I should cue the virtual high five, because you’ve just finished listening to another episode of the Fleet FYI’s podcast. If you’re already wanting more content, head over to utilimarc.com, which is Utilimarc with a C, U-T-I-L-I-M-A-R-C.com for the show notes and extra insights coming straight from our analyst to you. That’s all for me this week. So, until next time, I’ll catch you later.

If you or someone you know is interested in appearing on the Fleet FYIs podcast, please email our content manager for more information.


Gretchen Reese

Content Manager

Gretchen Reese is the content manager at Utilimarc. She has experience in global and strategic marketing, previously working as a copywriter and content specialist for a London marketing agency and freelancing in multiple niches. See more from Gretchen


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