Telematics: Empowering a New Fleet of Delivery Drivers
The telematics industry is a rapidly evolving market that provides in-vehicle technology for vehicles such as fleets. Telematics provides data to and from vehicles to manage vehicle performance, routing, and driver metrics. More recently, Telematics providers such as Telogis and Fleetmatics have moved into providing technology for passenger vehicles, such as GPS mapping and voice controls. Fast forward a few years, and Telematics could also be empowering a new fleet of potential independent contract drivers for the local delivery industry.
Telematics providers will eventually provide access to shipping marketplaces (Uship and Grand Junction) directly into vehicles that will empower individual drivers to sign on as independent drivers whenever it’s convenient for them. The telematics system will know a driver’s location, vehicle type, destination, and other relevant data that will make tendering a delivery pickup extremely efficient. Normal errands and road trips would turn into revenue-generating opportunities for every passenger vehicle. In fact, you may even see vehicle manufactures specifically designing and marketing vehicles with independent contractors in mind. This version of the future seems to match up with the emerging service economy driven by Uber and AirBnB.
Telematics represents an opportunity and also a threat to the local delivery industry. On the upside, technology costs, recruiting, and driver shortages would be problems of the past for local carriers. On the downside, drivers will no longer be captive to individual delivery companies, which might lead to dis-intermediation of the local carriers entirely. Carriers who bake these evolving dynamics into their business strategy can seize the upside. Those that deny or ignore the emergence of telematics may be left in the rear-view mirror.