Demand Spurs Equipment Standardization

In a price-oriented market such as transportation in Mexico, maximizing truck efficiency while ensuring constant uptime through telematics is key for carriers. The need for these systems has evolved to the point where manufacturers such as Navistar understand the value of these systems for their customers and for their own engineering needs, says Yoav Megged, President America of Israel-based telematics solutions provider Traffilog.
“The market has understood the value of these systems and how they can reduce maintenance costs and accident rates,” says Megged. The company allied with Navistar in 2013 and since November 2017, it is installing its equipment on all Navistar trucks and buses at the OEM’s plant in Escobedo. In 2018, Traffilog also started working with Mercedes-Benz to incorporate its solutions into heavy vehicles for the Mexican market. “Our technology goes in every bus and truck leaving Navistar’s production line,” he says. “Traffilog will also supply for Mercedes-Benz’s Bus Connection telematics system, which will be installed in some of the buses destined for the Mexican market.”
Traffilog’s success among automakers, fleet managers and insurance companies, however, did not happen overnight. According to Megged, when the company entered Mexico in 2012, these companies did not know what to make of Traffilog’s proposal. “Clients used to think a simple GPS would do the job but the market has developed a demand for these systems,” he says. Traffilog also faced the obstacle of a Mexican market that is highly price-sensitive. The company partnered with fleet management systems developer TomTom and now is the largest supplier of TomTom Bridge worldwide. However, it has been difficult to permeate the Mexican market. “Our alliance with TomTom has worked well internationally,” says Megged, “but it has not penetrated Mexico yet because the market is more sensitive to price.”
Quick returns of less than 12 months have attracted attention to Traffilog, nonetheless. Megged says the company’s systems enable businesses to save on mechanical elements, including engine, gear and brake wear as well as fuel consumption, a key input with price variations that deeply affect the Mexican transportation industry. “We can effectively reduce fuel consumption by up to 15 percent in the first months of using our solution.”
Security for cargo and operators has also been a key factor for Traffilog’s success. According to Nacional Security Commission data, there were 4,546 robberies of trucks during 2017 on Mexican roads. “Our solutions can help companies keep operations under control by authorizing only company drivers to open the truck doors and start the engine or preventing the unit from stopping at certain locations,” says Megged. “These measures have taken the recovery rate of stolen trucks equipped with Traffilog systems to 85 percent.”
By 2017, 20,000 vehicles in Mexico and 300,000 units worldwide had Traffilog systems installed. The company expects its business to keep growing in the heavy-vehicle market but also wants to increase its presence in Mexico by attacking the light and commercial-vehicle segments. “We are looking for one or two manufacturers in this segment to partner with,” Megged says. “This will make us the largest telematics company in Mexico.”
Traffilog has already started a project called Connected Car with a Volkswagen distributor in Scandinavia. The project’s goal is to gather data generated by vehicles that will be later used by insurance companies, workshops and toll roads to offer better services to car owners. “We have already installed 75,000 Connected Car devices in Volkswagen Group vehicles and our plan is to implement our technology in 200,000 more vehicles in 2018,” says Megged. Predictive maintenance and performance tracking are important to automakers, he adds. These features prevent component failure and enable companies to improve their engineering capabilities. The company is also launching a product called MDAS that consists of a Traffilog product combined with an Advanced Driving Assistance System. The system measures the distance between vehicles and alerts the driver when the car is leaving its lane. “We will start this program with a 500-vehicle pilot and we will release it for the volume market in 2019.”