Fleet Management Trends in 2022
Originally uploaded on August 11, 2022
So far, 2022 has been an immensely challenging year for those operating fleets. One of our top fleet management tips is to learn to adapt to the current environment and a large part of doing so is keeping up to date with the industry. In this post, we explain the biggest fleet trends and adversities that fleet managers have been discussing throughout the year. The top fleet management trends from 2022 so far have been:
• Increased operational costs
• Moving to electric vehicles
• Microchip shortages
• Cyber-attack concerns
• Grey fleet
• HGV driver shortage
• Increased interest in telematics
Below, we explore these topics in more detail and give advice for fleet managers moving in the third quarter.
Increased operational costs
The worrying and exponential rise in operating costs is the most popular talking point among this year’s fleet management trends. Fuel prices have risen throughout the year. In March, oil reached its highest price since the 2008 recession. This rise has seemed to temporarily plateau recently, but further increases are likely as we look ahead.
The rise in prices is due to a variety of factors. The most impactful has been the invasion of Ukraine by Russian forces. Russia was one of the world’s largest exporters of oil and supplied much of Europe before the invasion. Afterwards, countries began to introduce sanctions against Russia. This has affected the global supply of oil and raised costs, as well as put a strain on availability.
The effects of Brexit have also seen prices and time needed for importing and exporting goods increase this year. These delays have caused unwelcome strain for fleets and those in the freight and transport sectors.
As a result, the cost of most resources that fleets depend on has shot up.
David Legg, director of tyres at the i247 Group has said “We’ve seen manufacturer price increases due to cost rises across materials, logistics, labour, and fuel. These increases are then coupled with a significant change in the fleet mix where we are seeing larger rim sizes and new, more expensive tyre technology to accommodate an increasing number of SUVs and electric vehicles.”
Unfortunately, as most are aware, this is one of those issues that does not have a simple answer. A recession is looking increasingly likely as the economy struggles to right itself. On our blog, we have recommended diverse ways businesses can save money where they can. For those wanting to keep up to date with the oil market, our director, Andy Smith has a weekly update. This update, Fuel for Thought, breaks down the week’s oil market news and what it could mean for customers.
Moving to electric vehicles
When it comes to fleet trends, one of the most longstanding topics has been the 2030 ban on new diesel and petrol vehicles. In 2022, this incoming ban has seen fleet managers ramping up their efforts to introduce eco-friendly options to their roster.
Previously on our blog, we have discussed the alternatives available on the market, such as HVO and hydrogen. HVO offers a great in-between for ICEs. Hydrogen, however, looks to be the future of heavy-duty, time-pressured, transport such as HGVs. Even so, the industry discusses these options less than their more readily available counterpart: electric vehicles.
Electric vehicles are the main alternative fuel source supported by the UK government. As such, we have seen infrastructural developments for EVs such as grants and nationwide charging points crop up over the past decade. This has led to electric vehicles being a pertinent talking point when looking at fleet management trends.
Even though there have recently been issues in vehicle supply chains, we are still seeing an increase in the number of electric vehicles purchased. In April 2022, EVs had a 10.8% market share, compared to their April 2021 figure of 6.5%.
Initially, the switch to EVs encountered trepidation from fleet managers. However, the transition so far has been going smoother than expected. FleetNews reported that only 20% of fleet managers operating EVs saw rises in the cost of maintenance. When comparing this to the fact that 44% of fleet managers expected increases in maintenance costs during the switch, it raises hopes for a painless changeover.
Even though the target for the UK to hit net zero by 2050 appears a good distance away, it would be prudent for fleet managers to look into their fleet’s options for making the switch. This will ensure a smoother transition. However, fleet managers will need to be aware of our next fleet trend.
At the end of 2021, the global auto industry saw an output of 1.5 to 5 million vehicles shorter than planned. This has had a knock-on effect on fleets and fleet management trends everywhere, as vehicle supply has been sparse.
The main part that has been causing this issue is the semiconductor. Semiconductors are a vital part, used in lights, safety features, navigation displays and speedometers. The pandemic heavily affected the supply chain for semiconductors, which is taking longer to recover than hoped. The lack of this crucial part has seen vehicle lead times increase from 6 months to 9 months and over.
Also straining supply chains is the lower output from vehicle manufacturers, who shrank their production last year following reduced global requirements. As is the story for many manufacturers post-pandemic, they have struggled to keep up with the now vastly increased demand.
Thankfully, semiconductor production looks to be picking back up and is on track to be at a sustainable level over the next few quarters. In terms of vehicle manufacturers, there may still be a strain on fleets looking for new vehicles in the short term, but improvement in the long term is likely. Arval’s CEO Alain van Groenendael has said that their “N°1 mission in 2022 will be to help and support our clients overcoming the delays in new vehicles deliveries and in their energy transition”.
In the short term, fleet managers would be wise to extend the life cycles of their current vehicles and place orders for new vehicles earlier in anticipation of longer lead times. Using telematics to stay on track with your vehicle maintenance and reduce downtime or breakdowns is a terrific way to keep your vehicles moving while you work to update your fleet.
In May 2022, the fleet software firm Digital Innk warned fleets about the dangers of cyber security breaches. Various popular fleet news sources, such as FleetWorld and Business Motoring, shared this warning. This saw cyber security become a much-talked-about fleet management trend for companies across the UK.
A government survey prompted Digital Innk’s concerns. The survey, conducted between winter 2021 and early 2022, investigated the processes and approaches to cyber security for businesses to inform future policies. The key findings of the survey show that the percentage of businesses facing cyber-attacks has held steady between 2021 and 2022 at 39%.
Even though this figure is lower than 2020, which saw 46% of businesses facing cyber-attacks while employees were working from home, it is still a soberingly high number.
Endorsing strong cyber security is important for all businesses but especially in the context of fleets. As fleets use technology such as telematics and delivery planning software, protecting both your drivers’ and your customer’s data is an essential requirement.
The CEO of Digital Innk, Angela Montacute, advised businesses to update their fleet’s technology to the latest software to make sure their digital security can cope with newer dangers. “Cyber-attacks bring operational issues and the risks of reputational and financial damage,” she said. “Fleets should take action to ensure the digital platforms they use to interact with customers, suppliers and internally are secured with the latest technology.”
As well as keeping technology up-to-date, it is wise to review company procedures and implement regular training for the workforce about the dangers of phishing, suspicious downloads, and general online safety.
As operating costs continue to rise, businesses are now looking toward the benefits of grey fleets. Grey fleets, in which employees use their private vehicles for work purposes, also rose in popularity after COVID restrictions ended in 2021. Employees, who previously had used public transport before the pandemic, no longer felt comfortable doing so. Instead, staff began to drive themselves and have their fuel usage subsidised by their employer.
We are again seeing grey fleets become a fleet trend in 2022 as they can remove the expenditure from buying and maintaining vehicles such as pool cars. Grey fleets are not an option for every journey or every fleet, but for those using smaller vehicles for shorter range and less regular trips, they are a viable way to save your company money.
For those deciding to include more private vehicles in their fleets, it is important to ensure that all vehicles used are still legal and safe. Remember that employees will also be feeling the pinch and may hold off on repairs or maintenance as a result. In July, FleetNews found that 6.4% of 3,000 grey fleet vehicles assessed had illegal tyres.
It is also worth noting that using private vehicles can diminish the ability to collect accurate data from driver journeys. It is harder to track mileage without the help of telematics, which can make it harder to see where you can save money by planning your staff’s routes or choosing the most cost-effective refuelling points.
As long as well-constructed processes are in place that ensure vehicles are safe, a grey fleet is a good option for businesses that have infrequent low milage trips to save money on purchasing vehicles.
The HGV driver shortages
Fleet managers often discussed the HGV driver shortage at the end of 2021, a fleet trend that has persisted through 2022. Fortunately, the shortage has been showing the first signs of easing after government initiatives and media campaigns aimed at bringing fresh drivers on board.
In late 2021, the UK was short of over 100,000 qualified HGV drivers. This came as a result of factors including driver retirement, poor rates of driver retention, an enormous backlog of HGV driving tests caused by COVID lockdowns, and Brexit causing EU nationals who were working as HGV drivers to relocate. All of this, combined with the already present shortage of 60,000 drivers caused countless issues and delays within the transport industry.
In September, the government laid out thirty-three actions to try and increase the number of LGV drivers in the workforce. These included launching training schemes and boot camps, increasing the number of HGV driving tests by 90%, and introducing temporary visas for EU nationals working as HGV drivers. Some of these actions have been more successful than others, the government scrapped their temporary visa scheme in February after only attracting a proportionally small number of drivers compared to their target.
There has also been a media push to change the image of the HGV driving sector, encouraging more women to consider it as a career path. Recently, the BBC released its new show Queen of Trucks, showing the behind-the-scenes of women working in the sector.
For fleet managers operating HGVs in need of drivers, although recruitment is a factor, driver retention has much more of an impact on driver numbers. Creating a rewarding environment for your workforce should be a top priority for fleet managers wanting to avoid losing staff. Read our tips on how to be a successful manager for your drivers here.
Increased interest in telematics
At Fuelmate, we have seen an increase in interest this year in the benefits that telematics can provide. Telematics is an invaluable tool for fleet managers.
This is especially the case in the current climate where fleets are dealing with higher fuel costs and lower vehicle availability. Telematics can help fleets reduce fuel costs by monitoring their drivers for problematic habits that burn unnecessary fuel such as harsh braking or driving in the wrong gear. It can also keep you alerted to when your vehicles are requiring maintenance, which can help stretch out vehicle lifespans in the wake of longer vehicle lead times. If you are interested in telematics, or other cost-effective and convenient fleet solutions like fuel cards, contact us today.
If you would like to stay informed about fleet trends and news, make sure to keep up to date with our blog. You can also follow us on social media, such as Facebook, LinkedIn, or Twitter for regular updates. If you are searching for advice and guidance on fleet management and different management styles, check out our comprehensive guide to fleet management today.