If you provide fleet management (FM) in Russia and Eastern Europe (REE), the next few years should be prosperous. According to a report from Berg Insight, the number of installed FM units from Q4 2013 to 2018 is predicted to double.
For the purpose of compiling its report, Berg Insight defines a fleet management solution (FMS) as one that consists of a ‘vehicle-based system that incorporates data logging, satellite positioning and data communication to a back office application.’ This technology has reduced wasteful fuel costs significantly. Companies can monitor fleet vehicles more tightly, preventing their unauthorized use and incorporating more efficient routing. Insurance costs are another expense that an FMS can reduce.
At first glance, the revelation that the FMS market is strong in REE hardly seems newsworthy. Other reports predict similar growth in the global FMS market during the same period. ABI Research forecasts a threefold increase in fleet management systems, from $9.08 billion in 2013 to $27.61 billion in 2018.
What is significant is that the FMS market in REE has been resistant to outsiders. Vendors based in the U.S., U.K., Western Europe and South Africa have so far failed to gain significant market share in the region, even though they may have been successful in other markets.
A look at the countries that make up the EU may account for why vendors based outside the REE struggle. Many Eastern European countries like Romania, Czech Republic and former Soviet republics like Estonia and Lithuania are members, but Russia, Ukraine, Belarus and Moldovia are not. It’s conceivable that the reasons for these countries choosing not to be EU members are related to the area’s aversion to outsiders entering the FMS market.
Regardless of whether an FMS vendor is based in REE or not, the industry is expected to thrive for the next few years. Unrest in the oil-rich Middle East combined with the huge potential for fuel cost savings more than justify the expense of an FMS. It would be foolish for any company with a fleet not to at least consider purchasing one.
Edited by Adam Brandt