With the news of a potential recession and slow economic growth, more businesses are faced with decisions to restructure their finances. The transportation industry is facing its own unique challenges with rising fuel, labor, compliance, and insurance costs. According to the ATRI, “the cost of trucking in 2021 increased to its highest level in the 15-year history of ATRI’s Ops Costs.” It is no secret, operational costs for transportation are at an all-time high.
Fuel costs reached a five-year high of 61 percent in 2021 and insurance premiums spiked by 22.5 percent from 2019 to 2020. On top of this, the average accident settlement or verdict for fleets surpassed $360,000 and injury accidents involving large trucks increased over 25 percent from 2014 to 2019. All the while, salaries and health insurance for drivers and back-office staff continue to rise.
Implementing a cost-saving safety system can be the answer for fleets seeking greater efficiency and reduced costs. With technology becoming more and more advanced, fleets now have access to various solutions that allow them to streamline processes, increase safety measures, attract new customers, and enhance their reputation. One way to help increase efficiencies and reduce costs is by utilizing AI dash cams with powerful coaching abilities.
Benefits of Implementing AI Dashcams
During a down economy, safety should never be cut. In fact, your safety initiatives can be a cost savings opportunity. The benefits of implementing technology such as AI dashcams could be the key to turning your safety department from a cost center to a cost saver. The benefits include increased efficiency, reduced costs, enhanced reputation, and brand image which could lead to more customers.
Increased Efficiency
Fleets that take advantage of cost-saver systems often see an improvement in the efficiency of their operations. This can include quicker turnarounds on deliveries, better tracking capabilities, and improved communications between management and drivers.
Reduce Costs and Attract More Customers
By improving efficiency, fleets are able to reduce operational costs significantly. Lower overhead costs mean lower prices, making companies more competitive in the market. Offering competitive pricing structures helps draw in potential customers who might otherwise choose other suppliers with higher prices. When implemented correctly, AI technology can help reduce costs by identifying risky behaviors that lead to inefficient fuel consumption, costly legal fees, down equipment, and more.
Enhance Reputation & Establish Brand Image
Safety is paramount for any fleet operator, so having advanced safety measures helps to ensure the well-being of employees as well as the vehicles being operated by them. Taking strong efforts towards establishing a safe environment helps establish a trustworthy brand image amongst customers and enhances reputation with industry leaders.
Cost Savings Opportunities
Safety is paramount for all aspects of fleet operations, from the drivers and trucks to the data that informs decisions. Fleet safety requires a holistic culture that’s built on collaborative feedback and positive reinforcement. Litigators are increasingly pursuing safety departments for legal action rather than holding individuals accountable for incidents. Fleets can reduce costs by preventing aggressive driving and moving violations through effective coaching, and they can reduce legal and labor costs with high-definition AI dash cameras.
Reduce Moving Violations
Moving violations may seem like an inevitable risk of running a fleet, but the costs can add up and impact the bottom line. For example, a driver cited for texting while driving can cost a company $11,000. Multiple violations can increase the risk of costlier incidents for a fleet.
Netradyne customer, Titan Freight Systems, wanted to analyze 100 percent of drive time to understand risks. With Netradyne’s Driver•i, the company received a complete view of driver compliance with law enforcement and safe driving standards. Titan Freight Systems reduced unsafe events by 77 percent within a 10-month timeframe. The company saw an immediate improvement in driver coaching through the mobile app and additional improvement with managed coaching.
Reduce Fuel Consumption
Fuel costs are one of the largest expenditures for fleets. To help keep costs at a minimum, fleets should monitor driving behavior. Habits such as speeding, acceleration irregularities, or hard braking can have a negative impact on fuel consumption. According to the Department of Energy, those behaviors can lower fuel economy by up to 30 percent. Unusually high fuel consumption can signify an issue with the vehicle or driver’s behavior.
To reduce fuel consumption, it is imperative to implement proper driver coaching initiatives. This is where AI dash cameras come into play. It is recommended to leverage the power of AI dash cameras to properly coach drivers on both their great driving behaviors as well as behaviors that pose risks. With certain camera systems, drivers have the ability to self-coach and correct driving behaviors as they occur.
Dashcams assist with preventing violations by providing real-time driver coaching, this enables sustainable positive habits. In a study titled, “Timing Matters: The Impact of Immediate and Delayed Feedback on Artificial Language Learning,” researchers assessed the impact of immediate versus delayed feedback on learning a second language. They found that just a two- to three-second delay in sharing feedback reduced student ability to learn from mistakes by 21 percent.
Increase Back Office Efficiencies
Understandably, a lot of the focus of cost savings falls on the fleet and drivers, but there are many contributors who are key to the success of the business. While many of the cost-saving tactics fall on the safety department, there is no need to increase the number of employees within the department if the right technology is in place.
Technology is the key. The right dash cam system will automate driver coaching by organizing videos by alert type and severity, which eliminates the time it takes to search through hundreds of videos. It will also focus on positive recognition, so fleet managers can center coaching around accomplishments as opposed to mistakes. Lastly, the right system will have automated coaching sessions that empower the driver to make improvements on their own.
Trailiner, a Netradyne customer, said the Driver•i app has enabled drivers to self-coach, which eliminates the need for unnecessary meetings.
“If they complete their coaching at the end of week, it’s a hands-off deal, unless they have a very serious compound alert or drop below 650. Driver•i technology gives them the power to manage themselves. It’s more impactful for them to review their own videos and in real time. It’s more like homework than taking a trip to the principal’s office. And that’s huge.”
– Anthony Meloy, training and recruiting manager, Trailiner
Meloy said their overall GreenZone score, a measurement of safe driving, increased 10 percent in six months.
Retain Your Best Drivers and Save on Hiring Costs
Do you know who your best drivers are? The cost of replacing drivers can be costly for companies. According to the Upper Great Plains Transportation Institute, the average cost to replace a driver exceeds $8,000. The best way to train and retain your best drivers is through
That’s why having a video safety system that allows drivers to visualize and track their improvement is key for retention. This gives them autonomy over the field they specialize in and provides solid data for implementing an effective incentive program.
Dashcam Insurance Advantages: Reducing the Total Cost of Risk
Dash cameras have become a valuable tool for fleets looking to reduce insurance-related costs and optimize safety. Using dash cams to monitor driver behavior and record incidents could result in reduced risk which makes a fleet more marketable in the insurance industry. Insurance companies recognize the value that dash cams bring to fleets.
Impact of First Notice of Loss
If an incident does occur, the driver can quickly provide footage from their dash camera to police officers at the scene of an accident in order to protect themselves from unjustified accusations. This ability is only unique to fleets with dash cams that immediately provide footage. A lack of recorded video and limited visibility of what’s happening outside of the vehicle creates a greater risk for fleets. The solution is to have vehicles equipped with dash cams that offer a full 360-degree view.
An efficient First Notice of Loss (FNOL) process can shorten the claims process and lower loss severity. However, a study found that only 13 percent of drivers contacted their insurance provider at the scene of an accident. The study shared that if drivers provided FNOL at the scene then, insurers would save up to $800 per claim.
Dash cameras can be used to identify good driving habits that should be rewarded as well as improve driver training by identifying areas for improvement. Identifying unsafe behaviors early on helps fleets address potential problems before they lead to an accident or a costly lawsuit. As a result, shippers and brokers look favorably upon carriers with positive safety records due to their lower risk profile which enables them to save up on insurance costs.
One accident can have a major impact on costs. Shah Trucking experienced this first-hand. After two incidents, the company saw their insurance premiums rise. By working with their insurance provider, HDVI, Shah Trucking implemented Netradyne’s Driver•i, which allowed them to embrace a safety-first culture and implement effective driver coaching strategies. Just one year later they had a 65-point improvement in their FMCSA Crash BASIC score. As a result their insurance company offered a 10 percent premium reduction.
Protecting Your Fleet
The costs of an inadequate safety program can quickly add up, from accidents to mystery damage to theft and more – it is no question that protecting your fleet is more important than ever.
But what fleets don’t have control over is what other drivers are doing on the road. So what do you do? You need to arm your drivers with the knowledge and tools to make smart decisions while driving. That means providing consistent, reliable, and impactful coaching that helps identify risky drivers from good ones.
Gone are the days of relying on “carrot” vs “stick” approaches to fleet safety management. Technology now provides fleets with an array of options to improve safety standards and reduce costs associated with inadequate safety protocols – smarter coaching programs, better incentives, and positive recognition can help keep great talent in place along with improving driver awareness of safe practices.
STS Recycling, a Netradyne customer, gained visibility into what driver’s faced on a daily basis. For example, their safety and compliance director noted several hard braking incidents but the video showed the incidents were due to drivers maneuvering to prevent accidents. Instead of reprimanding drivers, the conversation shifted to praising drivers for being proactive to prevent incidents.
When considering strategies for improved fleet safety, it’s important to look beyond traditional protocols and instead leverage technology for improved results – helping you create a safer environment for your drivers while reducing unnecessary costs associated with inadequate safety practices.
Titan Freight Systems noticed a troubling trend, over the course of three years, they tripled the number of incidents and doubled their claims cost. The company discovered that high speeds and an increasing number of distracted drivers on the road contributed to these results. Titan installed Driver•i so it could see what was happening on the roads 100 percent of the time.
In just two weeks, Titan saw a 96 percent reduction in distracted driving alerts and they reduced unsafe events by 77 percent within 10 months of using Driver•i, with only external cameras enabled. As a result, the company saw a decrease in claims cost by 79 percent and collision-related incidents were down by 50 percent.
“We had zero deductible events in the last year, and we feel confident that it’s because of the driver behavior that we were able to show them through the AI. The amount we lowered our insurance was more than the amount we paid for the Netradyne Driveri system.”
– Keith Wilson, President, TITAN Freight Systems
Conclusion
In this guide, we explored the current economic climate, its impact on the trucking industry, and how the safety department can help. With diesel costs up 61 percent from 2021 and 80 percent from the 5-year average, insurance premiums rising 22.5 percent, accident verdicts and settlements costing fleets nearly $400,000, and salaries, health insurance, and other recruitment/compliance costs for drivers and back office staff continues to increase—it’s clear that fleets are feeling these costs in a big way.
However, technology can help fleets save costs while also improving safety. By implementing a cost saver system with the use of technology—fleets can reduce equipment downtime, earn more business, minimize the risk, and more. Ultimately, investing in fleet safety technologies such as AI dashcams is a key part of reducing operational expenses for fleets whose success depends on avoiding costly incidents.
