Better Roads

July 2014

Better Roads Digital Magazine

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T elematics. It's a buzzword in the construction industry. Although it's not a brand-new concept, and the penetration of telematics on the construction equipment industry as a whole is still somewhat low, equipment operators are starting to realize the benefi ts, especially as more manufacturers include telematics as a solution. In some cases, OEMs are making telematics standard. Telematics penetration in the global construction equipment sector will reach 30 percent by 2019, according to an ABI Research forecast. This growth is being driven by three key factors (although not necessarily all three of these drive the commercial, off- road market), according to the Visiongain report (, "Commercial Vehicle Telematics Market Forecast 2014-2024: What Are The Prospects For Leading Players?" First, increasing fuel prices accompanied with strong price-competition in logistics create downward pressure on the profi t margins of transportation companies and fl eet operators and drive them to adopt telematics to sustain profi tability and gain competitive advantage. Second, global regulatory mandates that require the use of telematics for safety purposes and the installation of basic Telematics Control Units (TCU) in all new cars and commercial vehicles in Europe from 2015 and in other countries in 2016. Third, there is increased demand for wireless connectivity. However, the telematics movement has hurdles: the high cost of the hardware for smaller and medium-size fl eets and privacy issues such as the potential exposure of sensitive company data. Many larger fl eets also already have a fl eet management system in place and may not want to invest additional money in a system. However, it's clear that telematics is the future. With high gas prices and an emphasis on greater effi ciency, telematics is a solution that just makes sense. "Adoption of telematics in the construction industry is a quality of life issue," says Al Cervero, VP Construction-Mining-Utility, for the Association of Equipment Manufacturers (AEM), which champions the merits of telematics. "We have it on good authority." Cervero notes Michael Jones, Google's Chief Technology Advocate, and Kirk Samuelson, senior vice president at Kiewit Construction, said at the 2013 AEM Annual Conference that when telematics are fully implemented long term, "the road-building industry will see reduced costs, increases in productivity and effi ciency." Cervero says the dollars in the Highway Trust Fund (HTF), which is currently on the brink of insolvency, will "go much further than they do now" when telematics is implemented, because it makes road construction more sustainable. How? Through lowered emissions, fuel effi ciencies and run time. "The adoption rate is critical (this started in 1997)," Cervero adds, "and we feel that as we come to a consensus standard among OEMs, the adoption rate by end users will gather momentum." Y by Tina Grady Barbaccia, Editor-At-Large Better Roads July 2014 3 Why Telematics Matter Editorial Editor-At-Large: Tina Grady Barbaccia Editorial Director: Marcia Gruver Doyle Online Editor: Wayne Grayson Online Managing Editor: Amanda Bayhi Production Editor: Lauren Heartsill Dowdle Editor Emeritus: Kirk Landers Truck Editor: Jack Roberts Construction Editors: Tom Jackson, Tom Kuennen, Dan Brown Design & Production Art Director: Sandy Turner, Jr. Production Designer: Timothy Smith Advertising Production Manager: Linda Hapner Construction Media Senior VP of Market Development, Construction Media: Dan Tidwell VP of Sales, Construction Media: Joe Donald Corporate Chairman/CEO: Mike Reilly President: Brent Reilly Chief Process Offi cer: Shane Elmore Chief Administration Offi cer: David Wright Senior Vice President, Sales: Scott Miller Senior Vice President, Editorial and Research: Linda Longton Vice President, Audience Development: Stacy McCants Vice President, Digital Services: Nick Reid Vice President, Marketing: Julie Arsenault 3200 Rice Mine Road NE Tuscaloosa, AL 35406 800-633-5953 For change of address and other subscription inquiries, please contact: Better Roads TM magazine, (ISSN 0006-0208) founded in 1931 by Alden F. Perrin, is published monthly by Randall-Reilly Publishing Company, LLC. © 2014. Executive and Administrative offices, 3200 Rice Mine Rd. N.E., Tuscaloosa, AL 35406. Qualified subscriptions solicited exclusively from governmental road agencies, contractors, consultants, research organiza- tions, and equipment and materials suppliers. Single copy price $5.00 in U.S. and Canada. Subscription rate for individuals qualified in U.S. and Canada $24.95. Foreign $105.00. Special group rates to companies quali- fied in quantities over five names. We assume no responsibility for the va- lidity of claims of manufacturers in any advertisement or editorial product information or literature offered by them. Publisher reserves the right to refuse non-qualified subscriptions. Periodical circulation postage paid at Tuscaloosa, Alabama and additional entries. All rights reserved. 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