Trends in fleet rental and leasing

Trends in fleet rental and leasing

According to forecasts, the European economy continues to grow and offer road freight transport operators additional opportunities for business. To meet increased demand, fleet operators need to consider how they develop their fleets. For many fleet managers, truck and trailer rental or leasing are very attractive and flexible solutions.

Market growth

The CNR (Comité National Routier), the French road freight transport economic committee, reported in November 2017 that the global economy will continue to grow at between 3.5 and 3.7% per year through to 2019. Meanwhile, it expects growth in the Eurozone economies to slow down to 1.9% in 2018. The road transport industry has benefitted. France, for example, saw a 10% rise in tonnes per kilometre transported in the year to the end of June 2017.

Growth in truck rental and leasing

Many operators are adopting flexible ways of running their fleets to meet the peaks and troughs of fluctuating demand for deliveries driven by e-commerce as well as economic uncertainty.

The truck and trailer rental and leasing industry have been a beneficiary. According to market researchers IBISWorld, this industry in the UK, for example, has grown at an annual compound rate of 3.7% over the last five years.

Trailer rental and leasing – advantages

Trailer rental and leasing should be on the radar screens of fleet managers seeking more flexibility in terms of when to increase or decrease their numbers of trailers, having access to the latest technology and how to finance their fleet. One advantage of having access to trailers through a rental or leasing arrangement is that it does not tie up all your capital as it would do through an outright purchase.

Meeting fluctuating demand

Through rental and leasing, fleet managers can add trailers to their fleets to handle surges in demand and hand them back during slowdowns in demand at short notice, with ease and without having to bear the fixed costs of ownership.

Competitive rates        

Thanks to the savings passed on by leasors through the economies of scale that they enjoy with the manufacturers, fleet managers can benefit from competitive rental or leasing rates for trucks and trailers. In some cases, this may provide fleet managers with higher specification vehicles than through their own purchasing power.

Ease of upgrade

Unlike a loan, it also gives fleet managers the opportunity to upgrade their trailers with ease without having to worry about the time needed to sell a used asset and its resale value. In the US, for example, according to Price Digests, used truck values fell 7.3% between May 2016 and May 2017, due to oversupply [Source: JPMorganChase]. This situation has parallels in Europe.

Leasing, newer trucks

The average age of leased trucks over 3.5t tends to be significantly less than owned trucks. For example, in Belgium leased trucks are on average 3.2 years old compared to 7.9 years old for owned trucks. [source: LeaseEurope]

Latest technology, sooner

The ease of upgrading through rental and leasing agreements enables fleet managers to move sooner to trucks with the most recent technology. This is an important consideration for fuel-saving technology since fuel consumption accounts for around 70 percent of a fleet’s annual operating costs [Source: JPMorganChase]. This will also contribute to fleets meeting ever more stringent EU CO2 emissions standards. Research company IBISWorld believes that operators that update their fleets with trucks that include the latest technologies are likely to outperform their rivals.

Outsource maintenance

As part of a rental or leasing contract, a fleet manager can outsource the maintenance, serving and repairs for their trailer fleet to the leasor or rental company. Time and resources saved can help the fleet manager focus on core parts of his business. It eliminates the need for the fleet manager to recruit, train and retain specialised trailer mechanics and to have warehouse space to store an inventory of spare parts alongside the fixed overheads of doing so.

TIP leasing and rental

TIP offers a wide range of rental and leasing solutions and can advise on the different leasing regulations across Europe. With a transport fleet of over 70,000 units, TIP is one of Europe’s largest transport equipment leasing companies. It can also purchase each asset specifically for you.

TIP rental options

We offer trailers on a rental basis in all forms including flatbed, curtainsiders, box trailers, tankers and reefers to fill short-term gaps in your fleet. This is an extremely useful option for fleet managers needing to fulfill a last-minute customer delivery request.

TIP leasing options

For fleet managers looking for a flexible and cost-effective way to manage their fluctuating medium to long-term trailer fleet requirements, TIP provides several leasing options:

  • Operating lease – This is off-balance sheet leasing with flexible terms. Operating leases are particularly attractive for high-value assets such as trucks and trailers which are needed to fulfill a specific contract. Lease rates are based on the value of the asset over the period you require it. As a result, you can link lease rates directly to the revenue your asset generates.
  • Finance lease – A finance lease allows you to acquire an asset over time rather than paying for it upfront.  The lease rates are calculated over an agreed term.
  • Sale and leaseback – Under this form of leasing, we will buy your assets at a fair market price and lease these assets back to you for a fixed monthly fee, thereby freeing up your capital for other uses.
  • Additional value-added services available across all our leasing solutions – We can offer replacement vehicles during repairs, maintenance, roadside assistance, fleet and tyre management and telematics for your fleet. We remarket trucks and trailers that are no longer needed.

For more information about TIP trailer rental and leasing, please contact TIP using this form.

How to deal with driver shortage – Part 2

How to deal with driver shortage – Part 2

Previously on TIP: 

Today fewer people want a career as a truck driver. The majority of the current generation of European drivers are over 45 years old and there is an insufficient pipeline of talent to replace them on their retirement. Europe faces a significant shortage of drivers.

How to deal with driver shortage – Part 2

The road transport industry has plenty of ideas and initiatives for solving the driver shortage.

  • Enhancing the imageUnit Cargo advocates turning drivers into “Supply Chain Professionals,” enabled by technology and playing a greater role in providing high-quality customer service. It believes that this transformation might justify better pay and lead to greater job satisfaction. Training drivers to be more technology-savvy could future-proof their livelihoods as the industry transits to autonomous trucks, for which technology skills will be in demand.

 

The industry needs increasingly to promote truck driving as an interesting career to young people/millennials, in general, to more diverse sections of the population.

 

  • Better pay – In 2016, in an effort to safeguard the wage levels of French drivers against foreign competition, France passed a law requiring any EU truck company to pay its drivers the French minimum wage whilst delivering in the country. Germany, Italy, Belgium, and Austria have proposed similar laws. (source: Bloomberg)

 

  • Improving working conditions – There are initiatives at all levels. At an industry level, the UK’s Freight Transport Association campaign illustrates objectives that are deemed to be practical. The FTA is campaigning for:
    • Student style loans for vocational training
    • Better driver facilities
    • Quicker turnaround of medical queries by the Driver and Licensing Agency
    • A campaign to raise awareness of the logistics sector – in partnership with the Department for Education
    • Members to come together to promote the logistics industry and engage with the public.

Truck manufacturers are looking at ways of making truck cabs as comfortable as possible, as a tool in driver retention. An October 2017 Frost & Sullivan report on the North America & Europe Medium-Heavy Truck Seating Systems Market, forecast to 2025, says that “The number of premium seats is expected “to nearly double in the next nine years as fleet managers deploy superior seats to reduce occupational fatigue as a strategy to promote driver retention.”

 

  • Encouraging women to become truck drivers – Women are an untapped labour force. Only 2-3% of truck drivers in the Netherlands and less than 0.5% in the UK are female. Truck companies are developing trucks that are more suited to women’s needs. (Source: DKV Benelux) Truck driving on routes that enable drivers to return home at night may be more attractive to potential women drivers with or without families. In some US cases, women drivers are being provided with a female mentor (source: Bloomberg)

 

  • Embracing autonomous truck technology – The advent of autonomous truck technology will represent an opportunity for truck drivers. Bob Biesterfeld, president of North American transportation at C.H. Robinson said: “Autonomous trucks may still need a driver in the cab to make sure nothing goes wrong.” (source: Bloomberg) That said, the role of the truck driver of the future will be different and require greater technical skills than today.

How to deal with driver shortage – Part 2

TIP Trailer Services – an alternative solution

      • Adopting logistics solutions – TIP Trailer Services believes that one approach to addressing the driver shortage issue is to look at current logistics solutions including:
        • 1:2 truck trailer ratios – Running fleets on a 1:1 truck trailer ratio is standard practice at many transport companies. However, it is also worth considering a 1:2 truck trailer ratio, using what is sometimes referred to as a “drop-and-hook distribution” strategy. In this case, drivers drop off one trailer at a delivery dock and then drive away with another loaded trailer. TIP has collaborated with some of its clients to implement this model with great success. Based on this experience, TIP has devised precise calculations which enable fleet managers to deploy their current driver pool with a greater number of trailers.
        • Trailer warehousing – This solution is a variation on the 1:2 truck trailer ratio approach. With trailer warehousing, you spread your own or rented trailers between different warehouse locations so that your drivers can drop off a trailer for unloading at a delivery point and then drive away either with a loaded trailer or to the nearest trailer warehouse on their route to collect a new trailer, either loaded or empty.

With both the 1:2 truck trailer ratio approach and trailer warehouse, drivers can maximize their driving time and earnings by not having to wait around for unloading.

      • Double deck trailers – With double deck trailers, one driver can carry greater loads. There are two types of double-deck trailers:
        • Fixed deck trailers have the highest load capacity, in weight and volume. However, they are only compatible with delivering to stores and warehouses that have external lifts. There is a variant on the fixed deck trailer, one with a tail lift. The tail lift has limited capacity and hence unloading is slow. This variant is best suited to multi-drop routes.
        • Moving deck trailers are very flexible with an upper deck which can be hydraulically lifted up or lowered during loading and delivery. This is a heavier solution than the fixed deck trailer because of the need to include the hydraulic lifting mechanisms. The hydraulics make the powered deck more expensive than the fixed deck. The moving deck trailer is ideal for products which do not double stack and, when loaded on a pallet, do not weigh more than 650 kg in total.

 

How to deal with driver shortage – Part 2

For more information on how TIP Trailer Services can help your fleet with solutions to driver shortages, please contact us using this form.

TIP will publish in February, Part 3 of this series; with more practical ideas and solutions to cope with the driver shortage. If you do not want to miss our industry news, sign up for the free monthly newsletter.

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How to deal with driver shortage – Part 1

How to deal with driver shortage – Part 1

Today fewer people want a career as a truck driver. The majority of the current generation of European drivers are over 45 years old and there is an insufficient pipeline of talent to replace them on their retirement. Europe faces a significant shortage of drivers.

The challenge

Steve Viscelli, a sociologist at the University of Pennsylvania and former driver sums up the challenge for fleet managers, commenting “If e-commerce goes up a lot and the introduction of autonomous vehicles is slow and the industry does not shift to millennials, we could see actual [driver] shortages 10 years out.” [source: Bloomberg]

Situation today

According to one report, 6.4 million drivers will be needed across Europe and the USA by 2030 with fewer than 5.6 million expected to be willing to work under “current trucking conditions.”

Why is it difficult to recruit truck drivers?

There are 5 major issues which discourage people from considering a career in truck driving:

  1. Poor image – Movies where the truck driver is the star peaked in the 1970’s with films such as “Smokey and the Bandit,” “Convoy,” and “Duel”. By the 1990’s, there were virtually no “truck-driven” movies. Truck driving has lost its glamour.
  1. Low pay – There is a widespread perception among truck drivers that they are paid too little for their duties and responsibilities considering the hours they work on average. Drivers working for fleets in their native countries typically earn close to the national minimum wage. As an illustration, the average wage for a truck driver in Ireland is €12 per hour, which is the median Irish wage. (source: Bakugls) The Comité National Routier, a transport think-tank funded by the French state, found that the total cost of a driver to employers ranges from 16,000 euros per year for a Bulgarian to 56,000 euros for a Belgian. (source: Bloomberg) In the highly competitive road freight industry, there is significant pressure to increase profit margins. The cost of labour accounts for approximately 35% to 45% of operating costs (source: FleetOwner).
  1. Poor working conditions – The European Union regulates the maximum working week for truck drivers to 56 hours per week. However, in reality, drivers frequently spend much more time on the road and away from home than this as they have to include rest periods. These rest periods are not always compatible with long-distance travel and returning home for recovery. Truck cabs can be cramped and truck stop facilities often lacking, making it difficult for drivers to maintain a healthy lifestyle.  With time away from their families and friends, truck drivers can lead an antisocial existence. Such lifestyle factors make it difficult for fleets to retain existing drivers and attract new ones.
  1. Inadequate provision of training and qualifications – In the UK, the “financial cost of acquiring a Driver Certificate of Professional Competence (“DCPC”) was ranked as the greatest barrier to driver recruitment by respondents” in a Freight Transport Association “Transport Manager Survey” in June 2015. This was followed closely by a “Lack of apprenticeship schemes”. The FTA’s Logistics Report 2016 also mentioned that “only around half of those taking the DCPC test, pass it”.

In an EU pilot study entitled “Making the EU transport sector attractive to future generations,” Polish industry experts concluded that training issues discourage potential drivers. They cited “The cost, time-consuming nature and complexity of obtaining necessary qualifications.” Course and exam costs are equivalent to two to three months’ salary in Poland.

  1. Autonomous truck technology – An issue or a solution? A joint report published in May 2017 by four European transport groups including unions and industry associations predicts a 50% to 70% cut in driving jobs in Europe and the USA by 2030, due to this technology. Of the 6.4 million driver jobs expected by 2030, the report found that between 3.4 million and 4.4 million would “become redundant” if driverless trucks are deployed quickly. In addition to autonomous trucks generating cost savings, lower emissions and safer roads, co-spokesperson for the report, José Viegas, Secretary-General of the International Transport Forum, said that autonomous trucks will address the “emerging shortage” of professional drivers faced by the trucking industry, particularly in Europe. The report also identifies ways in which governments and the industry can support drivers in the transition to autonomous trucks. (source: FleetOwner)

The arrival of autonomous trucks seems inevitable.  However, the switchover timing is unclear, with projections varying from a few years to a few decades. This uncertainty is unhelpful in terms of recruiting a new generation of truck drivers be they millennials, women or from any other demographic.

How to deal with driver shortage – Practical solutions

Fortunately, there are a variety of solutions that can help you to cope with driver shortage. TIP Trailer Services will share these with you in Part 2: Practical solutions for driver shortage. To make sure you do not miss Part 2, you are invited to subscribe to our newsletter:

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Mergers and acquisitions in European trucking

Mergers and acquisitions in European trucking

According to a survey published in November 2017 by Ti, a UK-based research consultancy, around 60% of respondents expect ‘significant’ levels of mergers and acquisition (“M&A”) activity in European road freight over the next five years. The same consultancy predicts that the European market which grew by 2.4 percent in real terms in 2016, will continue to do so but at a real compound rate of 3 percent through to 2020. This continuing market growth makes it a good time to acquire other fleets and capitalise on increased business opportunities. (source: JOC) Is your road transport company ready for M&A?

An active European M&A market

The forecasts are starting to come true. In November, leading ferry operator and logistics company DFDS announced that it is to acquire the Dutch company Alphatrans Group BV, a specialist in transporting oversize and heavy cargoes. (source: WorldCargo News) In addition, major US player XPO Logistics, having already bought France’s Norbert Dentressangle for $3.5 billion in 2015, is reported to be on the lookout for European acquisition targets. The same goes for DSV, an ambitious Danish trucking, and freight forwarding company, which is thought to be allocating up to $2 billion for the right deal. (source: JOC)

Synergies for road transport company M&A

In the case of a road transport company, the management needs to ask themselves strategic questions about their target and the possible synergies of combining both companies including:

  • To what extent the cargo flows of both companies match and how can we take advantage going forward?
  • How can we ensure fleet standardisation?
  • How can we use this transaction to increase the quality of the whole fleet?
  • How will the transaction help us reduce the total cost of ownership of our fleet?
  • How will we adjust our operations to ensure optimal use of the new economies of scale brought by the deal?

Keys to M&A success                             

If your company is considering an acquisition or merger, what are the keys to M&A success? A well-executed post-M&A integration strategy is vital for value creation. Inspired by advice from large consulting firms such as Bain and individual M&A advisers such as Toby Tester, here are the main success factors:

  1. Be clear about the objectives of your deal in strategic, financial and operational terms and how the transaction will add value to your business.
  2. Select a core group of internal leaders to build a comprehensive integration plan with defined measurements of success.
  3. Address the people and management issues quickly. Move quickly to select the top people from both organisations to execute the new vision for the combined company. This maximises your chances of retaining the best employees and customers and getting on with the integration.
  4. Progress with one culture only. Bain recommends that companies select one corporate culture, its way of doing things, usually the acquirers. Retaining two cultures causes friction, slows down the integration and destroys value.
  5. Communicate clearly, regularly and honestly. Obtain the buy-in for the transaction from people in both organisations as many will be nervous about their roles in the new set-up.
  6. Don’t forget the day job! The process of integration can be a distraction. The two companies should not forget the day-to-day running of their core businesses whilst the integration takes place.

TIP and M&A

TIP Trailer Services can support road transport companies going through the M&A process in several practical ways:

Outsourcing trailer maintenance to one company

One way of increasing the benefits of your M&A transactions is to outsource preventative trailer maintenance. Outsourcing is more cost-effective than keeping it in-house. You do not have to carry the fixed overheads of technicians or the latest diagnostic and repair equipment. This flexibility includes the 24/7 availability of maintenance and repair support through a pan-European network of workshops. Trailer downtime is minimised.

A well-designed and established outsourced trailer maintenance partnership with a market leader such as TIP will free up more time for your fleet manager(s) to dedicate to more business-critical activities like customer service or business development.

Selling used trailer assets

If you discover that your fleet includes too many or the wrong sort of trailers after an M&A transaction, we can sell them for you. Our excellent reputation as experts in trailers, gained over 50 years in the business, coupled with our extensive European network enables us to sell over 7,000 used trailer assets per year. We sell a whole range of used trailers including curtainsiders, vans, flatbeds, and reefers as well as trucks.

Trailer telematics and data systems

One way of boosting the business performance of your trailer fleet post-M&A is through trailer telematics. Trailer telematics gives fleet managers real-time access to a wide range of data about their fleets, enabling them to take business-critical decisions more easily. Trailer telematics covers many areas including driver and trailer scheduling, finding the most effective delivery routes, asset tracking, monitoring wear and tear on mechanical components and remote control of functions such as reefer temperatures or tyre pressures.

TIP can install trailer telematics, integrate it with your existing fleet management software and help you manage it.

TIP is also expert in fleet management. Managers can use our web-browser based software to monitor and control a wide range of fleet management operations. These include a fleet overview, service related documentation, compliance data, roadside assistance reports, accounting documents, trailer reservations and an interface with telematics. Where appropriate, these functions are linked to key performance indicators. TIP can help install and manage this fleet management software. In a post M&A environment, TIP can also assist you with the merging and integration of different fleet management data systems.

 To find out how TIP Trailer Services can help you in an M&A transaction, please contact us using this form.

 

 

 

 

 

 

What is Santa Claus bringing in his trailers this year?

Truck drivers throughout Europe will inevitably be thinking about Christmas. What will be the most popular presents they’ll be transporting this year?

As they cruise past homes featuring lavishly decorated trees and dazzling outdoor LED-powered Santa’s, truck drivers throughout Europe will inevitably be thinking about Christmas.  What will be the most popular presents they’ll be transporting on behalf of Father Christmas this year?

Top 5 Christmas gifts?

What will the Top 5 Christmas gifts be? The sheer volume of media coverage reveals which gifts are in greatest demand.  Our top prediction for young girls is “Wonder Woman,” be it Lego or fancy dress costume.  Technology gifts are always a Christmas winner, so our second gift slot goes to FitBit-style watches. Perfect for fitness fiends, these track your activity, encouraging you to exercise and transforming house cleaning or a walk to a restaurant into athletic events. Still, with technology and fitness, many people may find themselves receiving electric bicycles, which are now much lighter and more affordable than before.  Social media has turned food into fashion, so food and cooking-themed gifts are becoming ever more popular. As climate change appears to be altering our weather patterns, the environment and sustainability are rising up the agenda, so our final choice is for green-thumbed presents, from seeds to gardening books.

Growing consumer Christmas spending

The Christmas retail predictions point to good news for the transport industry.  Adobe Digital Insights November 2017 survey on Christmas retail trends tells us, for example, that the average Briton will spend £1,963 (€2214) on groceries, celebrations, decorations, and gifts this Christmas, up by 12.5% from £1,745 (€2233) last year. UK shoppers are big spenders, ahead of France (€498) and Germany (€565).  So expect your trailers to be full of festive gifts and food.

More Christmas shopping online

According to the Adobe survey, Britons will be carrying out over half (53%) their Christmas spend online. As a comparison, French shoppers will be making 46% of their purchases online. A similar percentage of respondents in both countries (21%) and (18%) respectively said that they would be increasing their online shopping this year. [French statistics source: Adobe]

E-commerce market still growing

The Centre for Retail Research (CRR) expects total e-commerce online sales in Western Europe and Poland to increase to £230.62 bn [€265.68 bn] in 2017, a rise of 14.2% over the previous year. Further growth of 13.8% in 2018 should mean that online sales reach £262.46 bn [€302.37 bn].

The e-commerce opportunity for transporters

When e-commerce grows, the transport market grows.  This is both an opportunity and a challenge for road transport companies.  Clearly, it is an opportunity because more parcels to distribute equals more business for the logistics industry. Conversely, it is a challenge in that volumes are difficult to predict. Christmas is a one-off annual peak shopping event. Flexibility is king in the transport industry.

Trailer rental for spikes in demand

Trailer rental enables transporters to respond to extra demand at Christmas or whenever it spikes.  If you do not own a large trailer fleet, trailer rental is your golden ticket. By renting trailers when you need them you can easily compete with your larger competitors without being burdened with their ongoing fleet ownership overheads.

With our 70,000 strong trailer rental fleet, TIP Trailer Services is the perfect partner to help you smoothly navigate the constantly changing volumes of e-commerce.  Not only with Christmas, but throughout the year.

Make Christmas delivery easy with flexible trailer rental solutions from TIP Trailer Services

Contact TIP Trailer Services for your flexible trailer rental solution enabling you to run an efficient and more profitable fleet management operation across the peaks and troughs of demand.

TIP employees on the Run

TIP-Med-charity-run

TIP Trailer Services participates in many charity events throughout Europe. It encourages employees to volunteer, to raise money for good causes and to give something back to society. Over the last few months, TIP employees have been organising fund-raising runs in several regions. Each region has selected its own charity to support. A recent example is the TIP Med Run in Madrid, which took place on 20 October.

TIP Med Run

The TIP Med Run was organised by local TIP volunteers and saw 25 people run a 4.5km circuit. The runners included Spanish customers and suppliers from Barcelona, Murcia and Valencia.  TIP Med Run regional organiser Sabrine Cortese Adnani expressed TIP’s gratitude to Frigicoll, BPW Trapaco, Lecitrailer, Nomar, Carrier and Hotel Campanile for their support of the event.

Impressive performances and fund-raising

The Med Run delivered some impressive performances with the winning TIP employee, David Viñeta, running the course in a remarkably quick 14.28 minutes. The group as a whole ran 85 km and, equally impressively, collected 1,551 euros for Amigos Escuella Wullinkama (“the Friends of Wullinkama School”), a charity that supports children’s education in the Gambia by providing them with educational programmes and activities.

Wullinkama School Project charity

We felt that the Wullinkama School project in Gambia, a West African country dependent on international aid with low adult literacy rates, was a very worthwhile project to support. It is part of a network of Early Childhood Development schools, which meets frequently to share knowledge and experience and deliver co-ordinated educational programmes. The school consists of four classrooms, an office, a kitchen, a small warehouse and bathrooms.

Our objective is to ensure the long-term existence and improvement of the school. The project benefits 115 children and provides employment for six local people.

Other charity fun runs across TIP regions

Other TIP charity runs include the:

  • TIP Nordics Run, organised by Julie Oddershede in Copemhagen. 29 runners covered 145 km and raised 2,500 euros for SOS Children’s Villages which cares for children in need. TIP employee Jonnie Hans won with a time of 21.48 minutes over 5km.
  • TIP Central Run, organised by Christina Harneit, which took place in multiple locations. 27 runners ran a total distance of 214 km and raised a significant amount for the 22Q11 charity, which supports children who suffer from a rare genetic disorder and runs projects in two SOS Children’s Villages in Germany and Poland. TIP employee Michal Brodowski set the fastest time, running 5km in 19.55 minutes.
  • TIP Benelux Run, organised by Chantal Gierveld. A group of 23 volunteers ran a total of 115 km and collected 2,211 euros for the 22Q11 charity. The winning TIP employee was Roel van Grinsven who finished the 5 km run in 25.03 minutes. Along with all the other regional winners, Roel was invited to a closing run in Amsterdam in November.

We would like to give a special thanks to all those TIP employees, customers and suppliers who took part in events in their regions and a big “thank you” to the regional organisers: Sabrine Cortese Adnani, Chantal Gierveld, Chrstine Harneit and Julie Oddershede!

Truck platooning: the latest developments

truck platooning

Truck platooning is a concept that has increasingly captured the imagination of governments, media, truck manufacturers and the road haulage industry over the last few years. How much closer is the concept to becoming reality on today’s roads?

What is “truck platooning”?

Truck platooning is a convoy of typically two to three semi-autonomous trucks, wirelessly-connected and all closely following one another. Acceleration, braking and steering across all trucks in the platoon is controlled by the lead vehicle. Each lorry is manned by a driver whose role is to manage the system and retake control in emergency or to drive the freight to its delivery destination, once the truck has split from the platoon. At present the practical emphasis is on semi-autonomous trucks for platooning including a driver although the media is discussing a future featuring driverless, autonomous trucks.

Platooning benefits

The benefits of platooning include:

  • Significant fuel savings and a consequent reduction in C02 emissions
  • Road safety. Braking reaction along the platoon is immediate
  • Improved traffic flow. Platooning boosts traffic flow and reduces tailbacks
  • The creation of new jobs and opportunities for further improvement in the logistics supply chain.

Early initiatives

In 2015, Daimler was given a licence by the State of Nevada, USA to test its Freightliner Inspiration semi-autonomous trucks for platooning in the state. [source: CNN] In 2016, Daimler unveiled the Highway Pilot Connect, a truck platooning system that was approved for use in a limited area in Germany.  It claimed that its platooning system offers up to 7% lower fuel consumption and correspondingly lower CO2 emissions, plus only half of the previously required traffic space. [source: TruckingInfo]  2016 also saw the Dutch EU Presidency develop the European Truck Platooning Challenge which aimed to address platooning issues at a European member state level. Among the highlights was the Challenge in which truck platoons from all the major European truck manufacturers drove successfully to Rotterdam from various cities across Europe.

Truck platooning in 2017

There have been many initiatives taking place this year. Nine states in the USA already have regulations that allow platooning and many more are expected to follow. [source: Trucks] Earlier in the year, Scania and Toyota announced that they will be trialling platooning on the public highways of Singapore. [source: automotivelogistics] In August 2017, the UK government announced that it will test a three semi-autonomous truck platoon on public roads in 2018. [source: Wired]

Truck platoons – a common sight on roads soon?

The most bullish supporters are in the USA. April Sanborn, the manager for Nevada’s autonomous vehicle programme says “I honestly see it [the deployment of autonomous-driving and platooning trucks] a lot quicker than 2025” [source: FleetOwner] Later in the article she added it will be “many years to come before we remove the driver.”

In Europe the outlook is different. French newspaper Le Monde believes that there are still many obstacles to overcome in Europe.  It notes that it will be difficult for fleet managers to plan for platooning when it is legal in some European countries and not in others.  Rules have to be harmonised. “The Dutch are ‘driving all out’ for platooning but in Belgium, the minimal distance between two vehicles is 50 metres. This renders platoons illegal.” Vincent Gaide at PwC questions how the transition between the platoons and the last mile transporter can be organised. The article also raises the spectre of the high likelihood of French truck drivers protesting against any government initiatives to introduce platooning.

Edmund King, president of the UK’s AA (Automobile Association) told The Guardian that “We have some of the busiest motorways in Europe with many more entries and exits. Platooning may work on the miles of deserted freeways in Arizona or Nevada but this is not America.” In the same article, Richard Burnett, Chief Executive of the Road Haulage Association cautiously welcomes the idea of truck platooning but warns that the current focus is too much on the technology behind platooning and not enough on safety. “Safety has to come first and it cannot be compromised.”

Challenges for platoons including trucks owned by different fleets will include “Who will benefit from the fuel savings?” Only the trucks behind the lead truck will. And, relating to that “How will the different fleets split the fuel savings?”

Flexible trailer capacity, trailers equipped with the latest technology – the keys to success

Whether or not the world is ready for platoons of semi-autonomous or autonomous trucks, there will always be demand for transporters to carry large volumes of products in their trailers. Having flexible trailer capacity with trailers that are equipped with the latest trailer technology are the keys to playing a successful part in the transport industry. Why not consider trailer rental or leasing from TIP Trailer Services? Ask TIP how you can benefit from our 50.000+ trailer fleet using this form.

 

Trailer tyre innovation reduces the total cost of ownership

Trailer tyre manufacturers are investigating options environmentally-friendly tyre manufacture, using new materials like elastomers and renewable biomass.

Tyres play a significant role in the cost of trailer ownership. For example, a preliminary report by the International Council on Clean Transportation, cited in inconvenienttruck.eu, found that the combination of automatic tyre inflation systems and low rolling resistance tyres can reduce fuel consumption and consequently CO2 emissions by 3% on trailer tyres and 5.91% on truck tyres. With so much at stake, tyre innovation is a theme close to the hearts and minds of many trailer fleet owners.

Recent tyre innovations

There have been many recent innovations in truck and trailer tyres. These include:

  • a European Union initiative to develop a low rolling resistance tyre with integrated telematics
  • the integration of RFID microchips into tyres
  • the creation of more environmentally friendly tyres
  • longer life tyres
  • tyres whose pressures can be monitored remotely.

RFID microchips in tyres

Various truck and trailer tyre manufacturers have integrated RFID (“radio frequency identity”) technology in their tyres.  Linked into software, the RFID microchip embedded in the tyre enables operatives to quickly scan and identify each tyre and then monitor them throughout their service lives including retreading and tracking them easily if stolen.

Making tyres more environmentally-friendly

Truck and trailer tyre manufacturers are investigating options for more environmentally-friendly tyre manufacture, using new materials like elastomers and renewable biomass.

Longer-life tyres

According to Fueloyal, the lifetime of an average truck tyre is 193,000 km. All the major tyre makers including Bridgestone, Continental, Dunlop, Goodyear and Michelin have created truck tyres, whose lives, if sensibly monitored, can be substantially lengthened by re-grooving and re-treading.  In an April 2017 article for SMMT, Chris Smith, Michelin’s Truck Marketing Director for Northern Europe, said that “Regrooving a tyre can extend its life by 25%”.

In the same article, Bridgestone’s Retread Development Manager, Terry Salter said “A new truck tyre weighs 65kg to 70kg but a retread only requires 20kg of fresh raw material before it can go back into service.  … That’s a big saving.”

Tire Pressure Monitor System – a tyre innovation through Trailermatics

With a Tire Pressure Monitor System (TPMS) you monitor tyre pressures. A rim-fitted sensor measures the tyre pressure, temperature and position. It feeds back live information to both the fleet manager and driver. They can ensure that tyres are inflated to the right pressure for the load and maximum fuel efficiency and take immediate action in the event of tyre issues. This ability to intervene quickly helps avoid road accidents caused by punctures or under-inflated tyres. The typical cost saving per vehicle per year with TPMS installed is €900.

Future developments

Ralph Dimenna, COO, Michelin Americas Truck Tires recently told CCJ that electric trucks will present tyre manufacturers with additional challenges due to double the amount of torque that electric motors generate over conventional diesel motors and the impact that will have on tyres. Tyres for autonomous trucks and tyres embedded with artificial intelligence are among the areas of future technology that manufacturers are researching.

Reducing the total cost of ownership through trailer tyres

Reducing the total cost of ownership is a core objective for many fleet operators. Managing your truck and trailer tyres well can lead to significant savings.  Choosing the right tyre through the EU Tyre Label scheme can make a substantial difference. The label covers ratings for fuel efficiency/rolling resistance, wet grip and exterior noise. According to the Goodyear Innovation Centre, the difference between a complete set of A-class tyres and F-class tyres can reduce a truck’s fuel consumption by 15%, roughly equivalent to an annual saving of more than €7,000.

Fleet managers need to select truck and trailer tyres of the appropriate size for their trucks and trailers and the loads that they carry. Trucks working on regional routes with many delivery points will benefit from tyres that offer high mileage whilst those on long haul should take advantage of more fuel efficient tyres. It is essential to maintain the tyres properly including applying the correct tyre pressures, which affect fuel consumption and tyre wear. Distribute weight evenly across trailers so that the wear on tyres is even.

Good tyre maintenance practices enable fleet managers to retread their tyres and in the process, reduce costs, lengthen tyre lifespan and minimise environmental impact.  Moreover, with training and monitoring through telematics, truck drivers can operate with a driving style that optimises fuel consumption.

TIP trailer tyre experience and expertise

Our experience in maintaining trailers for over 45 years gives TIP extensive trailer tyre expertise. Drivers can bring their trailers and trucks in for tyre maintenance and repair at one of TIP’s network of over 70 workshops across Europe. Alternatively, one of TIP’s ever growing fleet of mobile service units can help on-site.  Fully qualified and certified technicians are on hand to assist you. TIP can provide you with a flexible trailer tyre service and total peace of mind.

TIP and trailer tyres

TIP can set up your truck and trailer tyre management so that your assets always roll in the best possible way! Contact us using this form.

Trailer rental – the new standard

Trailer rental – the new standard

One of the characteristics of Millennials, the generation of people born between the early 1980s and 1990s, is that “they are reluctant to buy items such as cars, music and luxury goods. Instead, they’re turning to a new set of services that provide access to products without the burdens of ownership, giving rise to what’s being called a “sharing economy.””  Economist Jeremy Rifkin predicts that “25 years from now, car sharing will be the norm and car ownership an anomaly”. [source: Goldman Sachs research] In the business to business sector, the same applies to trailers. With many fleet managers appreciating the flexibility and cost effectiveness of trailer rental, trailer rental is increasingly becoming the new standard.

 

Flexibility and scalability through trailer rental

Two of the most appreciated advantages of trailer rental are its flexibility and scalability. These enable companies to exploit exceptional, fluctuating and/or seasonal business opportunities. Perhaps you have an urgent customer delivery need which requires you to take on extra trailer capacity. Or perhaps you are a transporter in industry sectors where demand fluctuates dramatically.

Examples of areas requiring flexibility include “fast fashion” where manufacturers such as Inditex and H&M need supply chain elasticity and trailer flexibility to quickly deliver not only low-cost imitations of catwalk clothes collections, influenced by the catwalk shows but also their own “value-for-money” collections throughout the year. There is no better illustration of a seasonally-driven delivery period than Christmas. Trailer rental offers fleet managers the opportunity to cater for this spike in demand to smoothly enable Father Christmas, Sinterklaas or Saint Nicholas to get presents to children on time.

Cost-effective

Trailer rental can give you access to the best trailers and latest trailer technology without the high investment costs of owning the trailers and overheads of ownership such as the recruitment and retention of qualified engineers, the running of a workshop or keeping an  inventory of spare parts.

Scale up when you need to

Customers choosing to rent trailers through TIP Trailer Services are also able to enjoy preferential rental terms within rental or lease contracts to take on more trailers or reduce the number as demand requires.

Trailer maintenance and repair – outsource them

Keep your trailer fleet in peak performance mode with TIP. As part of a trailer rental contract, TIP Trailer Services takes the weight off your shoulders by providing you with maintenance and repair management services. Whilst we look after the maintenance and repair of your rental trailers, we supply you with alternatives to ensure that your business continues to operate as usual. Maximise your trailer uptime!

Should one of the trailers in your rental fleet require roadside assistance on the way to London, Paris, Warsaw or any other European destinations, you can count on our Europe-wide breakdown recovery service 24/7 365 days per year.

All types of trailers

TIP hires out trailers for every task including curtainsiders/tilt, moving/walking floor, flat, reefer, tanker, chemical, tipping powder, waste tanker and many other types of trailers, tankers as well as trucks.

Trailer flexibility with TIP

Our world class customer service teams across Europe make sure that our rental trailers are maintained to the highest standards, allowing you to enjoy total operating efficiency. To capitalise on the new business opportunities provided by trailer rental with its flexibility, scalable load-carrying capacity and cost-effectiveness, please contact TIP Trailer Services.

Freight exchange trend update: bitcoin and blockchain

Freight exchange trend update: bitcoin and blockchain

The lost revenue and missed freight-carrying opportunity of an empty trailer returning to base is a source of sleepless nights for many fleet managers. Fortunately, freight exchange platforms can address this problem and are becoming more mainstream.

Unused trailer capacity

Unused trailer capacity is a major industry issue. The UK’s Freight Transport Association analyses the level of empty loads each year as part of its Logistics Report. Empty loads have constituted approximately 30% of all trailer journeys since 2011 (Source: Fleetpoint.org).  These empty loads are bad for both business profitability and for the environment due to CO2 fuel emissions for what are, in effect, wasted journeys.

One solution is to equip your trailers with the latest telematics technology to ensure that your drivers are performing optimally and using the most fuel-efficient routes. Telematics will also help you allocate the right trailer and truck combinations. Another solution is to join freight exchange platforms to find loads to carry on return journeys.

Freight exchange platforms today

Uber did the road transport industry a favour in May 2017 by launching Uber Freight, its own freight exchange platform (source: Business Insider).  Even if it has only started operating on a small scale out in Texas between Houston, Dallas and Austin, Uber Freight put spotlights on the media and transport industry and the opportunities that freight exchange can provide.

170+ European freight exchanges!

You have an empty trailer returning from Brno in the Czech Republic? Why not click on Raaltrans or another freight exchange to fill it?  The number of exchanges is growing.  There is a very useful list of European freight exchanges on the internet which includes over 170 exchanges and their basic fee structures.

Cargonexx, a German freight exchange provider which launched in December 2016, claims to have over 1,700 freight companies registered on its platform. In its press release from March 2017, Cargonexx maintains that it is “one of the most successful platforms for lorry transport in Europe”. There appears to be a healthy appetite for freight exchanges among road transport companies but the question is whether there is sufficient demand to support 170+ exchange providers. In the longer term, provider consolidation seems likely.

Future developments?

Examining developments in other parts of the world provides useful insight into what might happen in Europe. In the case of road freight, European developments often follow the USA. Interesting developments there include:

  • Blockchain-based freight transactions

Maria Theresa Dalagan comments in the August 2017 issue of US title Freightwaves that container shipping companies are starting to take a “blockchain-based approach” using a digital currency called “Ethereum” one of 1,037 crypto currencies (source: Benzinga) of which the “Bitcoin” is most high profile. She cites the example of 300cubits, that specialises in enabling transactions in the shipping container industry by using Ethereum. In the medium term, the blockchain is likely to be adopted by the European road transport industry.

  • Trucking Futures Exchange

In February 2017, US companies Transvix and DAT Solutions (a successful US on-demand freight exchange provider with 100 million loads and trucks posted in 2016) formed an alliance to create a Trucking Futures Exchange. This enables shippers to buy delivery contracts or the option to do so at specific prices today. They will be able to hedge against market volatility for transport prices which can vary with the “weather, fuel prices, congestion, seasonality, regulations and macro economics”. (Source: Logistics Management). This project is in early stage development, but, in the long term, a European equivalent could provide an additional revenue source for fleet managers.

The freight exchange platform opportunity

Freight exchange platforms will increasingly become part of everyday operations for the fleet manager and an additional source of revenue, contributing to fuller trailer loads.