The ROI of Safety Equipment: Destined to Rise
For decades, fleets have considered the staggering cost of collisions as unavoidable as death and taxes. These days, as new technologies alert drivers to potential collisions—and, increasingly, take complete control of the vehicle to avoid the collision altogether—fleet owners may well be wondering if there will come a day when collision costs become marginal.
At present, each significant collision drags along with it a “truckful” of costs: vehicle repair, sick pay, lost productivity,temporary vehicle leasing, and insurance premium hikes. Whether the collision was your operator’s fault or not, the collision will mean negative public awareness, damage to reputation, legal costs and, in the worst-case scenario, court judgments. With all this at stake, it is no wonder so many fleets are aggressively implementing new safety technologies.
Determining the exact cost of collisions—and the return on investment of technologies to reduce them—is complicated. One way to get a quick sense of ROI is to see what the biggest companies are doing. If they are investing heavily in safety systems, it’s reasonable to conclude that they have found clear ROI. And investing heavily they are.
Two of the largest fleet management companies, Penske and Ryder, are adding a number of safety systems to their vehicles—and in many cases making these systems standard equipment. Penske is adding radar-based collision avoidance systems and air disc brakes to its commercial tractors. Ryder is installing forward-looking radar and collision-mitigation systems on its commercial rental fleet.
On the public side, Eugene Water & Electric in Oregon is one of many municipalities around the country that has begun installed increasingly sophisticated safety systems. EWEB’s goal is to install back-up cameras on its fleet of 350 vehicles. In doing so, the city not only gets ahead of coming federal regulations, but lowers its operating costs and insurance exposure, while at the same time demonstrating to its community that it is a responsible public organization.
A recent report by the Boston Consulting Group noted that the commercial vehicle sector is “ahead of the curve” in terms of implementing emerging advanced driver assistance systems (ADAS). BCG defines ADAS as any system that provides visual coverage of rear or side blind spots, uses radar and other active systems to detect objects and warn drivers, and uses active braking technology to avoid forward-facing collisions. PRECO customers who have installed radar-based object-detection systems on their fleets report a reduction of more than 75 percent in collisions when the systems are deployed.
An exciting development for public and private fleet managers is that manufacturers are working with safety system providers such as PRECO to integrate individual safety technologies into broader collision-mitigation systems. Imagine a scenario in which an operator drifts into an adjacent lane, at which point a lane-departure warning system steers the truck back into its lane. At the same time, a video monitoring system is triggered to record the entire episode. The company will later use this real-life video as part of its training program. It is this ability to both prevent collisions and improve operator skills to avoid future collisions that makes these integrated safety systems so powerful.
Calculating the exact ROI of any piece of safety technology can be a frustratingly complex ordeal. The proof of the pudding will be the ability of that technology to reduce the frequency and severity of collisions. Is it wishful thinking to suggest that, even though recent numbers point to a rise in vehicle accidents, more sophisticated, integrated, and accurate safety systems will reverse that trend? As more vehicles are equipped with increasingly intelligent collision-mitigation solutions, our roads and highways can move inexorably toward greater safety. That is the most promising kind of ROI we can hope for.