Hitachi: Navigating Fleet Challenges with EV Transition

Managing a large fleet has always been demanding, with fleet managers tasked with balancing high utilisation rates, optimal fleet health, and minimal downtime. As industries embrace the transition to electric vehicles (EVs), these responsibilities have become even more complex, creating a "perfect storm" of challenges that require innovative solutions.

Rajesh Devnani, Vice President of Energy & Utilities at Hitachi Digital Services, offers insights into how modern fleet managers can address these pressing issues and adapt to the evolving landscape of fleet operations.

What primary challenges are associated with operating and maintaining a large fleet?

Large fleet owners and operators constantly struggle to ensure high uptime and fleet utilisation. Unplanned downtime can lead to productivity losses, client experience issues, and higher operations and maintenance costs.

In addition to fleet health, other primary challenges relate to safety and compliance in fleet operations, fuel optimisation, driver management and retention, managing the impact of environmental emissions, and successful technology adoption.

To what extent is electrification adding complexity to fleet management?

Fleet providers must embrace electrificationHitachi since it is the future of large commercial fleets. Electrification, however, introduces significant complexity to a fleet's operation and management, and hence, it is imperative to be fully prepared before adopting fleet electrification at scale.

First and foremost, electrification requires access to a reliable charging infrastructure, which implies a choice between establishing a dedicated in-house charging infrastructure or relying on public infrastructure. Range limitations, which have a bearing on route planning and optimisation, are also an issue.

Electrification also requires significant upfront investment, and the cost-benefit of electrification is contingent on multiple factors not directly under the control of the owner-operator, including government incentives and support, electricity rates, and more. The management and upkeep of EV batteries and managing battery replacement cycles add another layer of complexity.

Fleet electrification is also synonymous with digital technology adoption, and fleet operators must invest in acquiring the necessary capabilities and skills to run electric fleets. Transitioning a fleet to electric is not a simple endeavour; it needs to be planned comprehensively and rolled out in a staggered fashion.

What consequences might companies experience as a result of poor fleet management?

Poor fleet management can have a range of diverse adverse impacts on a company's performance. The financial impacts attributable to a poorly managed fleet include additional operational costs leading to reduced profitability. These operational costs manifest themselves in the form of frequent breakdowns, unplanned repairs, increased downtime, and inefficient fuel usage.

In addition to direct cost impacts, a poorly managed fleet is susceptible to higher accident risks and safety concerns and reduces the average age of the vehicles in the fleet. Failure to meet regulatory requirements can also subject a company to significant penalties for non-compliance with safety and emissions standards. A poorly maintained fleet is also subject to higher insurance premiums, which again increase the fleet's cost.

Last, the most significant impact is on customer experience and brand reputation, which may significantly dent the top line through customer churn.

What solutions exist to solve these aforementioned issues? 

Running a successful fleet requires the right strategy, effective execution practices and an array of enabling technology solutions. Key among these is a comprehensive fleet management solution that provides a complete view of the fleet, including utilisation, fleet health, maintenance needs, fuel efficiency, driver behaviour, and more.

Complementary components include a telematics and GPD tracking system, which provides real-time tracking of vehicle location, speed and route adherence.

Another key ingredient is AI-driven maintenance solutions, which deliver predictive maintenance to minimise operational and maintenance costs, avoid breakdowns, and deliver higher utilisation, productivity, and client satisfaction.

How do AI and machine learning play into these solutions? 

AI and machine learning are becoming deeply embedded and integral to the solutions described above. AI-powered predictive maintenance solutions that predict impending failure/miles to failure are par for the course. So are AI-driven route optimisation solutions that can dynamically reroute drivers in real-time for the most optimal and fastest routes.

Other AI and machine learning impact areas include:

• Fleet performance management, which can help analyse overall fleet health and trends
• Demand forecasting algorithms to predict demand and align supply in accordance with that
• Autonomous vehicles and platooning
• Driver behaviour monitoring, which sends real-time notifications to improve driver safety and performance
• Fuel efficiency optimisation solutions which reduce idling and optimise speed to improve fuel efficiency
• Automated planning, scheduling and dispatch solutions.

How crucial are predictive analytics in this space?  

Predictive analytics provide a key competitive advantage and differentiation in fleet management. They impact cost efficiencies and optimisation, automation, revenue augmentation opportunities, and complete business model reinvention. Their impact spans all business functions, including fleet operations, maintenance, safety and compliance, S&OP, demand management, and, most importantly, client experience.

Predictive analytics are an integral part of forward-thinking, customer-oriented fleet organisations, which leverage analytics across a myriad of use cases to optimise performance across every facet of the organisation.

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