GPS Tracking ROI

Commonwealth and state road authorities will contribute $5.8 million over four years to a transport industry initiative to use satellite and mobile communications to cut travel times and improve productivity.

The Intelligent Access Program will use GPS and telematics to track and trace heavy vehicles in exchange for enhanced access to Australian roads….

Full Article Here

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Here’s some very interesting news from Australia.  The article’s a little long and complex to wade through, but the gist of the program is the government is giving “seed money” to start a program that will eventually encompass all commercial road users who wish to participate.  The program will track vehicle locations, many operational parameters such as driving times, fuel used, hours of idling and other issues with both commercial and environmental impact.  The carrot, in addition to the seed money, will be that users of the system will have improved road access.

After the initial investment period, the operators of the tracking systems will be paying the state governments a significant fee .. currently $33 a month per vehicle for the privilege of providing the service.  Their profit apparently will come from the difference between what they charge the trucking companies per month and the money they pay the State,

A majority of my readers here are US-based and this doesn’t seem to be a direct “fit” with our American government-business model.  But actually, when it comes to heavy truck — 26,001 lbs and up — we already have much of this system in place in the US, but we have never bothered to look at the business model to move it into the 21st century.

Currently, there are two private but government-sponsored entities that control two of the most important aspects of road trucking, across North America: IFTA and the IRP.

IFTA is the acronym for the International Fuel Tax Agreement.  Here’s a sample state explanation of the IFTA:

The International Fuel Tax Agreement (IFTA) is an agreement among 48 U.S. states and 10 Canadian provinces (58 jurisdictions in all) to simplify the reporting of fuel use taxes by interstate motor carriers. IFTA reporting significantly reduces the paperwork and standardizes the reporting of fuel use taxes.

Before adoption of IFTA, each member state and province had its own fuels tax return, license, decals, rules, and forms and performed its own separate audits. A motor carrier operating in multiple jurisdictions had to comply with the reporting requirements of each state or province, which made filing returns difficult and time consuming.

Some advantages of IFTA are:

	One set of rules with a single definition of motor vehicles that qualify for IFTA. These rules override the rules of member jurisdictions.
	One set of tax forms to complete in the base jurisdiction rather than a separate return for each jurisdiction where an IFTA licensee operates.
	A single fuel use tax license that authorizes a licensee’s vehicles to travel in all IFTA jurisdictions.
	A single IFTA audit instead of an audit by each jurisdiction.

The agreement is administered by a special corporation, home page here:

In addition to fuel taxes, each vehicle in interstate commerce has to pay licensing (registration) fees to the various states they travel through.  Not too many years ago, you may remember over the road trucks often had a forest of license plates on their front bumper, the trucking companies had to buy a license plate for every state they might travel through.  Now, by means of the IRP, International Registration Plan, a truck owner only needs to register in one state and the IRP distributes each fair share of the registration fees to the states the vehicle happens to travel in.  In summary the IRP is described here:

The International Registration Plan is a registration reciprocity agreement among states of the United States and provinces of Canada providing for payment of license fees on the basis of total distance operated in all jurisdictions.

The unique feature of this Plan is that, even though license fees are paid to the various jurisdictions in which fleet vehicles are operated, only one (1) license plate and one (1) cab card is issued for each fleet vehicle when registered under the Plan. A fleet vehicle is known as an apportionable vehicle and such vehicle, so far as registration is concerned, may be operated both interjurisdictionally and intrajurisdictionally.

Now my point in all this detail about these two plans is that their model is the same .. miles per vehicle are tracked in each of the 58 or so state/provincial jurisdictions and the trucker pays one bill and each jurisdiction gets their fair share of taxes and fees.  Good for business and good for government.

The fly in the ointment is:  each of these plans requires a tremendous amount of paperwork.  In particular mileage reports for each and every time a vehicle’s wheels turn.  Then clerical types have to read the reports and keep them into accounting programs , rectify any errors, search for any “missing” miles and oversee the process of payment checks from truckers being received and revenue checks being cut to the jurisdictions.

How much simpler, indeed, all this would be if the trucking companies merely gave the IFTA and the IRP a data “portal” into the GPS tracking systems most of these companies are already using.  This isn’t done today, for two main reasons.  We never thought of doing it that way, one, and two, we have an obsession with the illusion of privacy.

It’s only an illusion of privacy, because really, each and every turn of the wheel on a heavy truck is known to the government anyway .. but the layer of paper involved somehow hides this fact.

We can keep on with this manual monstrosity as long as we wish to waste the paper and the labor hours, or we can make use of the resources already available to increase profit and decrease wasted time … if only all countries were as technologically advanced as our Australian brethren.

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