North America, behind in mobility but ahead in autonomy
The transition from fleet management to mobility management is not just a European thing. But Europe is far ahead, and North America lags behind. The reverse applies to autonomous vehicles, where the Americans are clearly in the lead.
The major trend in the European fleet industry is the massive transformation from fleet management towards mobility management, and all the changes in attitudes and business models that this entails. “In North America, we see this as an evolving trend, but we see it as What things might look like in the future”, says Chad Christensen, senior strategic consultant at Element Fleet Management.
Why? Simple: fuel prices. “Fleets are indeed under a great deal of cost pressure. Analysing vehicle eligibility and car-sharing possibilities will continue to increase, but less rapidly while gas prices remain relatively low. If they were to rise above $3/gallon again, we may see more movement towards a variety of sustainable fleet options”.
Chris Conroy, president and CEO of ARI, agrees: “These issues are being discussed in North America as in Europe. And without question our industry is changing and is likely to look significantly different in five, ten and especially twenty years from now. But the adoption of alternative mobility solutions is likely to be slow. However, there will be early adopters – especially if it makes business sense”.
“On the other hand, those vehicles that are tied to the work, with specialty upfits and additional equipment, cannot be easily replaced with a shared solution. In my experience, these fleets are environmentally conscious and will adopt technologies to shrink their carbon footprint. But in these cases, mobility and shared services simply isn't the right way to achieve that goal”.
Utility vehicles make up a much larger share of North American corporate fleets and benefit cars a much smaller one, which partly explains the lesser success of mobility solutions. Dan Frank, CEO of Wheels, Inc. offers another perspective: “In North America, where distances can be significant and where public transportation alternatives are lacking, the mobility solutions offered in Europe are not practical. And from a cost perspective, retail prices for ride-sharing and other alternative transportation modes can be significantly higher than the highly discounted cost of transportation as experienced by commercial fleet operators”.
There is a but: “In certain situations – on large campuses, sites and branches for example – car-sharing is practical, and many-to-many vehicle/driver relationships are being offered”.
10% fully automated
The North American executives are unanimous when it comes to the trend that in their opinion will have the biggest impact on the future of fleet management: autonomous driving – not coincidentally a field in which the U.S. has assumed the global pole position.
“Consultants Frost & Sullivan forecast that by 2025 there will be around 3.2 million self-driving cars on U.S. highways, of which 10% will be fully automated and another 50% highly or semi-automated”, says Chris Conroy.
But autonomous driving is not just the future, it is already here: “Some features on vehicles today, such as electric power steering and advanced driver assistance systems, are actually preliminary steps towards full autonomy. And in certain situations where driving and road conditions can be highly controlled, like mining or agricultural work, we already see the adoption of autonomous technology”.
Autonomous vehicles are an opportunity and not a threat, says Jim Halliday, president and CEO International at Element Fleet Management: “These autonomous cars will all need to be financed, managed and serviced. Plus, they will generate extra services and data, increasing safety and efficiency”.
But there is more, says Dan Frank: “While the headlines are grabbed by autonomous vehicles, we anticipate that artificial intelligence technology will eventually impact virtually everything that is connected with the physical delivery of goods and services”.
Will the future fleets of Europe be shared and those in North America be self-driving? Or will new developments like artificial intelligence lead to a renewed convergence? Only time will tell...
| 17/05/2017 | Frank Jacobs