There has been a massive upwell in the fleet management market numbers in the past few years. The anticipated growth will increase from USD 19.9 billion in 2020 to USD 34.0 billion by 2025, at a Compound Annual Growth Rate (CAGR) of 11.3% during the forecast period.
Before delving into these numbers, it is imperative to understand what fleet management is. Fleet management is a process used to manage a fleet from acquisition to disposal. It enables companies to carry out functions more economically and enhance compliance throughout the operation.
Governing a cluster of commercial vehicles can often be challenging. Additionally, there are other external hurdles that one cannot dictate. Example: legislation changes, car market uncertainty, and spiraling costs. This can make the process seem tedious and overwhelming.
Big corporations use immense vehicles to carry out their businesses. Such a job requires professional fleet management. The rationale is to control commercial vehicles' entire life cycle, reduce associated risks, enhance competence, productivity, and ensure compliance with legislation.
Companies in possession of fleets come under courier companies, haulers, sales companies, service companies, and other public transport companies.
They all have a grip over the functioning of fleets and are acquainted with associated details. The fleet management market is witnessing many upcoming trends these days. The sections below will talk about it in detail.
Fleet management entails many functions such as financing, vehicle maintenance, vehicle telematics (tracking and diagnostics), driver management, speed management, fuel management, and safety management. There are many trends that arisen from these roles. These are:
1) Driver management sector is expected to grow: Management of the driver includes applying for a license, insurance management risk, and analysis.
The rationale is to study the driver's attitudes and behavior and make the necessary adjustments to driving styles. Their driving styles should ensure minimal use of fuel and enhance the vehicle's longevity.
These steps aim to secure more responsible driving behavior. They continuously send back feedback regarding driving styles. Establishments are leaning into these steps to save fuel and maintain minimal costs. It also allows for more vehicle security.
Volvo trucks reported that people caused 90% of accidents and 13% perished on the spot. It is hence essential for companies to regulate and train their driver in a more streamlined way.
2) The United States will testify significant growth: The US government is determined at lowering their accident counts which comprises the fleet management services. Ford, General Motors, and Fiat-Chrysler command the US fleet.
Increased awareness regarding the cost benefits of fleet management and leasing will lure in more customers. Also, reduced government spending and anxieties related to double-dip recession could impede the market growth.
Fossil fuels, such as gasoline and diesel, cause excessive carbon emissions and pollution. These are induced by transport vehicles and constitute 31% of pollution in the US. The US department of homeland security has adopted fleet management solutions. They are in contract with several fleet services.
3) Vehicle substitution: The total expenditure of buying a fleet is the loftiest expense bourne in the process. It is prudent for fleets to use light-duty trucks. Truck costs have also amplified in recent years because of increased demand. This, in turn, has put more weight on fleets, displacing seasoned vehicles.
4) Maintenance management: Inestimable elements can impact fleets' maintenance costs and keep up with these expenses can be challenging. It is imperative to spend on software to diminish the work pressure.
Factors like the cost of parts, batling labor expenses, or building an appropriate vehicle sustenance plan require software. The price of maintaining fluctuates between 30-50%. With such a large amount at stake, there is no room for overspending and miscounts.
5) Insurance and wages: The influx in insurance rates and wages has ramifications on fleets' operation costs. It is also requisite for fleets to insurance in case there is an accident. Telematics can help provide a clue regarding driver behavior, reducing the risk of accidents.
5) Talent acquisition and retention: The rate of unemployment will decrease in the coming 50 years. The fleet market will have to be prepared in light of events. Proficient operators can leverage various benefits from separate companies, which might negatively affect small-scale industries' potential to compete for a skill. To stand out in this competition, companies are offering several incentives and benefits.
The fleet management market has taken off and will continue to grow. Their penchant for technology and agile personalities make it one of the most leading industries around the world.
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