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'Tech-first' model to deliver cost benefits for GCC's fleet managers

by Neha Bhatia on Nov 11, 2017

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While the effect of reduced oil prices on the Gulf’s construction sector is an oft-reported topic, lowered petrodollars are having an even more significant impact on the regional fleet management segment.

As GCC governments make strides in their migration to ‘green’ fuel and financing, regional operators – and manufacturers – are being compelled to revisit their product and business strategies as well.

The nexus between sustainable products and financial benefits is examined in the market overview feature (page 20) of this week’s Special Report. Across the region, vehicles of every type and size are being put through extensive revamps to up their sustainability quotient. Unsurprisingly, these activities are most prominent in the UAE, and the country’s efforts to adopt eco-friendly products is supporting the creation of a parallel ‘green economy’ – one that could prove beneficial to the country’s early adopters of advanced fleet operation and management techniques.

Notably, efforts to boost fleet sustainability and efficiency are not restricted to make or market – international original equipment manufacturers such as Caterpillar and Volvo Trucks have each unveiled system updates and product lines this year that are dedicated to supporting their customers’ migration to modern, environment-friendly fleets. Caterpillar’s revenues rose by 9.5% to reach $11.3bn in Q2 2017, compared to $10.3bn in Q2 2016, and its strategies have obviously paid off this year. It is fair to assume that global manufacturers, and their regional partners, will continue their targeted approach to sustainability next year.

Meanwhile, on the other side of the supply chain, operators and specialist product manufacturers are increasingly investing in finding new models to help maintain both traditional and modern fleets. This week’s feature on fleet technology (page 22) reviews the strategies that notable systems and telematics suppliers – such as Al Bahar Positioning Group, Restrata, and Mix Telematics – are currently adopting to boost fleet efficiency in the Gulf.

Market observers are likely to witness increased instances of diverse fleet technology products being integrated under single models next year, highlighting the significant, region-wide improvement in operator awareness of intelligent fleet monitoring, experts say. Yet again, the initial financial benefits accrued through a tech-first approach are evident; Al Bahar Positioning Group is preparing for steady regional growth next year, with the company set to increase its staff by 20% to meet future demand.

End-user perspectives are also driving product programmes, and a Swedish steel giant is furthering the theory that fleet owners are the best positioned to influence heavy equipment production strategies. This Special Report concludes with a report from SSAB’s Middle East office, which recently held a seminar in Dubai to promote the benefits of knowledge-sharing between equipment suppliers and operators (page 26).

Clearly, despite the hurdles associated with market liquidity and the cost of new technologies, the GCC’s fleet management sector is ready for more, and as this Special Report shows, the region’s public and private sectors are set to grow in 2018.