Editorial

The Path to Greater Fuel Efficiency

by Anselm Waterfield, CEO, TransLogix, September 2011

A two year exemption from the carbon tax is a small win for the trucking industry and a welcome breather for trucking operators who are doing it tough. Let's make no mistake though, it remains a looming reality. Those operators who continue to focus on resistance rather than change will almost certainly arrive at 01 July 2014 with the realisation that they have done nothing to address their carbon footprint.

Resisting the inevitable is easy, yet embracing this grace period as an opportunity to set change in motion is smarter. Given the multitude of other, more immediate business priorities, it would be all too easy to push carbon tax issues to the back burner.

Let's consider for one moment what transport companies can and are doing to address both immediate and future priorities. Carbon tax or no carbon tax, fuel efficiency and improved use of your vehicle assets will consistently remain at the top of the priority list for owners.  Addressing fleet utilisation issues with the aid of sophisticated routing and scheduling technologies is just one way in which many owners are now tackling their transport costs. In doing so, they are laying the foundations for a fuel efficient and 'carbon friendly' operation.

Let's imagine you are running a transport company with 20 trucks and with at least 100 deliveries scheduled between them each day to multiple customers. You know your current routes and schedules are not the most efficient because you have a number of vehicles poorly utilised, driver hours are up and there is remaining capacity on the trucks. Your costs are escalating.

You know if you could get better utilisation of vehicles you could save money, in fact, you wouldn't need so many vehicles. The problem is when planning the routes there are literally thousands of combinations...

Is it too much to expect a person to be able to construct the most efficient routes with so many combinations to choose from? The challenge is that on a daily basis, the business is often completely reliant on a small number or even a single individual to plan the most optimal routes. This requires a great deal of expertise and experience. Your people are always going to be limited by the available time and the demands of the business. If the business scales it becomes increasingly difficult for them to consistently identify the top 10% of usable routes. It is the efficient utilisation of assets that leads to better customer service and ultimately profit.

So how are transport businesses cracking this?

In the right scenario it's been proven over and over again that routing and scheduling technology can save 10-20% of transportation costs through better utilisation of vehicles. Lower driver hours and kilometres travelled equals less fuel consumed. The sophisticated algorithms driving these technologies are computing millions of routing combinations in a matter of minutes as opposed to what would take a person many days to achieve.

In addition to understanding the road networks and physical limitations of moving through the geography, these systems are processing other complexities related to the job such as fleet configuration, tight delivery windows, vehicle restrictions, and special equipment requirements. Essentially the technology is doing the leg work, removing unusable routes, and making it easy for your staff to consistently operate with best results.

By linking routing and scheduling technology to your other systems, transport operators can achieve far better fleet utilisation. Increasing fleet utilisation can directly reduce fleet costs and emissions. Set the wheels in motion now to achieve greater efficiencies and you might be better prepared when the carbon tax hits.

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