Car Sharing: A Slow-and-Steady Disruptor

easy access to car sharing through app

Car sharing app

With the emergence of the sharing economy, making things that were once personal accessible to complete strangers has become the norm. This “new normal” of renting out everything from our services to our homes is changing the role of private ownership. It not only creates opportunity for both providers and consumers but disrupts traditional industries. Among these are the auto retailers and car rental companies faced with a surge in car-sharing services. Like other disruptors, car sharing not only poses a unique option for the public but imposes challenges and considerations for both government regulators and automakers.

Our vehicles spend approximately 95 percent of the time parked and car sharing creates a purpose for the often dormant everyday automobile. These programs are akin to renting, but with more flexibility. A car share allows you to borrow an automobile for a short time at a fraction of traditional rental car rates. This low-cost business model is making autos available without the responsibility of car ownership, need of loans or credit checks. Car sharing also provides a form of alternative income for private owners just as ride-hailing and home shares have done.

Like Uber, Lyft, and Airbnb, car sharing has stepped into a traditional industry in an untraditional way, which makes many wonder what regulations are on the horizon? And what does this mean for the automotive industry?

The birth of the sharing economy

sharing economy visual

When the recession hit in the 2000s, consumers sought new ways to either make money or pay less for necessities. When Apple created the App store in 2008, it opened up a whole new way of receiving goods, services, and information. Businesses could work together through these smartphone apps as well as everyday people gaining broader access to either products or the ability to offer something for sale or short-term use. This led to the birth of the sharing economy, which is the sharing of goods and services, free or at a lower rate than traditional companies charge, and is more peer-to-peer than corporate.

The app store made it possible for anyone interested in offering and procuring any type of good or service to do so on a broad scale via an on-the-go, open 24/7 mobile device. That same year, companies that offer fee-based “borrowing” or “splitting”—such as Taskrabbit—began cropping up, establishing a foothold in the sharing economy. And so it was only a matter of time before car sharing became one of the many ways of not only making money but having access to something as vital as an automobile without having to own it yourself or pay exorbitant rental car fees.

Mid-20th Century innovative thinking

Zurich pioneers car sharing in the 1940s

Zurich, Switzerland

While an intrinsic part of the innovative sharing economy, car sharing is not a 21st-century invention. The first recorded program started in Zurich, Switzerland in 1948. The Swiss city created Selbstfahrergemeinschaft–known as Sefage–to make vehicles available to residents who couldn’t afford private car ownership. The program was in existence until 1998 and set the stage for Europe to embrace the concept.

Throughout the last half of the 20th century, the idea of sharing a vehicle began taking shape across both Europe and North America. As traffic congestion got worse, economies became more burdened, and cities began to spread, the need for such programs became more appealing. By the late 90s, several systems were in place on the other side of the pond and Carshare Portland in Oregon became the first program in the U.S. in 1998. Zipcar, Flexcar and City Car Club all launched in 2000, with Zipcar ultimately purchasing Flexcar—which had already purchased Carshare Portland—and becoming the most used program in the country. Europe still has the most accepted systems and the highest number of members, but car sharing is now available in over 600 cities and countries such as China, Brazil, and Canada.These range from peer-to-peer services (P2P) to corporate-owned business-to-consumer (B2C) operations.


Peer-to-peer services or P2P are programs that allow private car owners to “share” their personal vehicles with others. Getaround, which joined with CityShare in November 2016, and Turo (formerly RelayRides) fall into this category. The companies facilitate the connection, but like Uber and Lyft, the proceeds—less a handling fee—belong to the owner.

P2P programs are heavily neighborhood based. Cars are either left in a parking space for pick-up or, in the case of Turo, delivered to a pre-determined meeting area. Vehicles are opened via a smartphone app and the agreement is that they are clean and gas tanks replenished with fuel used.

Business-to-consumer (B2C) companies offer autos that are part of a corporate maintained fleet. Rental outfits like Enterprise Rent-a-Car, Avis, U-Haul and Hertz have expanded into hourly sharing of their vehicles and have even purchased competitors—Avis bought ZipCar and Enterprise Rent-a-Car bought PhillyCar Share—to boost the fleets that support their local car share program. Many offer electric vehicles—Car2go, for example—which supports decreasing our carbon footprint, a major goal of this program.

The logistics of car sharing

handing keys over for car sharing

Flexibility and accessibility make car sharing different from car rental. In both cases, there are no rental agents. B2C services are at your disposal 24 hours a day, 7 days a week. Because P2P relies on actual vehicle owners, accessibility is a bit more structured, but still more fluid than traditional rental agencies. The majority of these companies require consumers to join and pay a subscription or membership fee to access cars, whether P2P or B2C. This is different than the sharing price and is a fixed amount either per month or year. It allows members to browse different cars in their area, reserve one for whatever time they need and access a smartphone app to manage their subscription. Cars can be picked up in designated areas around the city, whether it’s a specific zone reserved for that sharing service or the last parking space in which the previous user left it.

B2C subscriptions allow you to unlock a car with either a membership card, smartphone app or a fob. Keys are left inside and once that vehicle is opened, the “sharing” time begins. It then ends once the car is returned to the designated parking space and it is locked with the app, fob or membership card. Therefore, if a driver forgets to deactivate the car, rental fees continue to be charged and penalties incurred for using the car beyond the agreed upon borrowing period.

Through the use of location services and base stations, maintaining the fleet of cars and finding them as a consumer are simple. The location services are handled through the mobile devices and each car is geotagged through the interface with the base stations. These are basically the hubs that bring in and send out the information on where to find whatever car is reserved. These work in tandem to help clients of the car sharing services track down a vehicle at any time of the day and for the companies to keep track of their automobiles. This technical collaboration is a vital aspect of the entire industry in order to keep consumer confidence in the business model high.

The system fulfills a growing need for short-term car rental and helping whole communities that are experiencing transportation issues. It’s also become part of the conversation on just how government can manage and work with the sharing economy.

Disrupting industry and regulators

The sharing economy has reimagined some of the most tried-and-true industries—Uber and Lyft with ride-hailing, Airbnb with hospitality and various car sharing companies with automakers and rental agencies. These innovators have shifted the paradigm in their respective categories, creating disruption in a way both established companies and regulators were not prepared. Regulators find themselves addressing this new space by straddling both the requirements of traditional businesses and the new upstarts who are presenting issues not previously considered.

Right now, businesses that sprouted out of the sharing economy are mostly unregulated. Because of this, however, they are dealing with some backlash—in court and various cities/states/countries. They are rogue by nature, operating in a grey area, and growing at an astonishing rate, which has put many on the defensive and made regulating them difficult.

Car sharing appears to be different. The business model that has been around since the late 40s is getting supporters in the digital age. States like California, Washington, and Oregon require motor vehicle owners who wish to rent out their personal automobiles to belong to car sharing companies to ensure they meet safety, insurance and financial reporting requirements. Car sharing companies consistently work with cities as well as support some of the lower income residents and local universities with their short-term car rentals. However, they are viewed as traditional rental companies by regulators, which has led to their being taxed in a way that makes many wonder if carsharing is being unduly burdened.

The taxes on these transactions as well as motor vehicle departmental fees associated with traditional car rentals have created problems for car sharing in some states because they negate the “lower-priced” business model. With a tax that is equivalent to a traditional car rental, that percentage can be 20 percent or more—a charge that needs to be passed on to consumers. The assumption, however, is that the bulk of rental users are out-of-towners, meaning it is a tax that is only collected from those participants when using the cars. Car sharing is different because local residents are the core users. This is what has regulators reevaluating whether it makes sense to treat car sharing services the same way as rental agencies when the purpose is far different. Car2Go found itself so burdened by the taxes and fees recently, they had to pull out of such cities as San Diego and Miami, and was on the verge of leaving the Twin Cities in Minnesota when local officials decided to take a deeper look at how it is being charged.

This collaboration between lawmakers and car sharing companies has led to a smoother transition and implementation of this solution. The fact that established automakers and rental car companies have seamlessly entered the fray puts car sharing in a different regulatory light than ride-hailing/sharing and hospitality disruptors.

Automakers and the disruptors

Per Boston Consulting Group (BCG), car sharing will account for the loss of just over one percent of total automobile purchases worldwide by 2021—or 792,000 vehicles. This is actually a negligible amount because as autonomous cars and fleet sharing become more appealing to consumers, OEMs see this as a chance to engage in a new market and boost sales in other areas. Rental car giants and automakers are already getting ahead of this by starting their own or purchasing existing companies.

Enterprise Carshare came about thanks to the rental company’s purchase of the highly successful, community friendly PhillyCarShare. The Philadelphia based nonprofit program began back in 2002 to serve the local citizens with underutilized fleet vehicles. PhillyCarShare also encouraged the use of low emissions cars. In its first year, it saved Philadelphia approximately $8 million. When PhillyCarShare was purchased by Enterprise in 2011, it was renamed Enterprise CarShare and while no longer a nonprofit venture, it has since expanded to offer the lower-priced, highly-accessible cars across the nation.

Daimler recently launched CROOVE, an app that “lets private vehicle owners share their car, too.” Unlike other companies that have attempted to enter this space, the German auto manufacturer has created a program that allows you to choose any available car, not just the ones they make. Per Daimler CEO Dieter Zetsche, the goal is to offer a sort of “Airbnb on wheels” experience.

Daimler already owns car share service, Car2go—known for its electric vehicles—and provides a bulk of the cars for taxi fleets throughout Europe. GM, meanwhile, has expanded its partnership focus beyond that of Lyft and has come to an agreement with Uber to provide vehicles to its San Francisco drivers. The company does this through its Maven car-sharing app. Maven allows Uber drivers to rent a GM vehicle on a weekly basis, similar to that offered to Lyft whose drivers can choose from the Hertz fleet of cars or GMs via the GM Express Drive program.

A program for the masses

stylized visual of people on the streets

The benefits using sedentary fleet vehicles as well as the ability to provide affordable transportation to those in need make car sharing of interest to organizations throughout the world. Federal and local government agencies, cities, and universities/colleges find this a helpful solution to get more cars off the road and fill the need of those who often require the short-term use of a private vehicle.

The General Services Administration (GSA) provides a plethora of services to the federal government from offering up API’s for mobility services to maintaining its role in managing the facility needs of the various agencies. Recently, the agency implemented a car sharing pilot program awarding a Blanket Purchase Agreement (BPA) to Zipcar, Carpingo, Hertz, and Enterprise CarShare. New York, Chicago, Washington, D.C., and Boston have been chosen as the test cities, and the service is made available to individual employees as well as entire offices. The project, which started as a 1-year pilot in 2014 and has been extended year-over-year ever since, will allow GSA to track the accessibility, sustainability, and efficiency of car shares versus vehicle purchase. The hope is to make a case for implementing more eco-friendly, congestion-saving government fleet solutions around the country.

Universities and colleges are naturally gravitating toward this model as well due to the limited space for cars on campuses. It has alleviated gridlock and parking problems along with allowing students to focus on putting their money toward what really matters—education, food, and savings—instead of the high cost of owning, operating and housing a car at school.

A vintage solution expanding its reach

unique car being picked up

Car sharing may not be new, but it’s proving to be even more viable in today’s automobile saturated, digitally enabled world. While all eyes are on the horizon awaiting self-driving cars, these services are making use of what already exists in a way that addresses the many issues facing automobile use today—many companies offer vehicles with alternative fuels to lower emissions. Whether this will take off the same way as ride-hailing and hospitality alternatives remains to be seen—the entire industry is currently worth $1.1 billion compared to the $30 billion of Airbnb and $68 billion of Uber alone. But car sharing bears watching as it gains a steady following that may very well be instrumental in changing the face of the automotive industry in a way carmakers

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m-Government: The Path from Electronic to Mobile

the bridge from e to m-Government

You access any number of government processes via the internet these days. From eFiling taxes to renewing car registration, electronic government or eGovernment is streamlining some of the most time-consuming public transactions. But this paperless solution only succeeds for those people who can get to a computer. What about those who can’t? This is where mobile government or m-Government comes in.

Embarking on the new frontier of m-Government

We are a mobile society. 1.9 billion people or approximately 25 percent of the world’s population own a smartphone or tablet or both. That number is expected to climb to 70 percent by 2020. This steep increase is due to several reasons. The first and most obvious is the desire and ability to stay connected with whomever, whenever. Mobile devices have become economic tools for many as well, allowing them to pay bills, purchase items and check balances on the go. It’s also easier to purchase a cellphone than a computer for many people. But what also makes mobile so appealing is the convenience and ability to conduct business or manage your affairs anytime anywhere. These mobile devices are a global way of connecting and their use is growing. With that comes the expectation of apps that make life easier and more efficient. The ability to create anytime access to eGovernment service is part of what has led to m-Government.

Committed to government app development

the potential information shared through m-Government

Creating apps that allow you to access the public sector is increasing. Governments are discovering that presenting an easier way to engage with their constituents makes it better for the users. It also ensures transparency between public agencies and residents. That encouragement for more open and honest communication and availability of government services comes not only from private citizens, but from lawmakers. Two examples of this are the United Arab Emirates (UAE) and the federal government run General Services Administration (GSA).

UAE rewarding government innovation

The UAE is in its 4th cycle of presenting the Best M-Government Services Awards. These were created by Vice President and Prime Minister and Ruler of Dubai, His Highness Sheikh Mohammed bin Rashid Al Maktoum in 2013 in order to reward those agencies best embracing m-Government. His vision of “making government available and accessible to the public 24/7 and 365 days a year” prompted the competition that kicks off in late October and announces winners at the World Government Summit in February. The contest is open to app developers worldwide to promote creating a more connected, efficient system for the public sector in the process.

GSA and the road to mobile government

The GSA is a massive resource for U.S. federal agencies and the military. It provides real estate that houses different offices, manages the nation’s fleet of public vehicles and serves as liaison between public-private partnership. One of its goals is to establish an easily accessible m-Government, which it does through its Technology division and the Mobile Program Management Office (Mobile PMO). The Mobile PMO offers m-Government based tools to assist federal agencies in presenting smarter public service to citizens. The division pursues this expansion on a national level. It supports different ways of applying mobile technology and even provides assistance to federal agencies in testing and creating their apps.

As part of this digital initiative, the agency has established 18F, which is an office within the GSA’s Technology Transformation Service. The name is a play on where the GSA is located–18 & F Street NW in Washington, D.C. Its purpose is to help “other federal agencies build, buy, and share efficient and easy-to-use digital services.” While its focus isn’t just mobile, 18F provides API key assistance to its clients. API stands for “application programming interfaces.” Basically, this is a way for different apps to communicate. API keys then then make it possible for apps to connect with your account without a password. This is an integral gateway to m-Government services. When government offices use API keys, they are then able to unlock a way to interface with a website’s information on different platforms, including mobile.

Unique opportunity for road and vehicle safety apps

Through the work of Sheikh bin Rashid of the UAE, the Mobile PMO of the GSA and others, the world is evolving its eGovernment service to include a more readily accessible experience via mobile technologies. Consequently, some of the most beneficial m-Government apps are those that support road and vehicle safety. Due to the transient nature of cars, the public sector has seen these as a natural connection to offering easy ways to access road and vehicle information. These are created to alleviate congestion, and make your drive/ride safer and easier. Here are four examples of global based transportation apps:

Hong Kong–promoting inclusion, information sharing and culture

m-Government communication in Hong Kong

The state of Hong Kong offers a rather extensive list of publicly supported apps that address a variety of m-Government needs. These range from providing new, non-native residents with information that makes navigating Chinese society easier to highlighting the life and achievements of martial arts legend, Bruce Lee. Among the transport apps are those that focus on three of the most important ground travel issues in Hong Kong–mass transit, parking for private cars, and traffic updates. Hong Kong streets are notoriously congested and these apps are alleviating the issues the city faces.

UAE–putting their vision to practice

m-Government comes alive in the UAE

As one of the leaders pursuing and promoting m-Government practices around the world, the UAE is a strong mobile presence at home, and road and vehicle safety is part of it. The 2015 winner of the University award for the Best of M-Government Services was its own NYU Abu Dhabi for Road Watch, a traffic app. The Federation struggles with a high vehicle fatality rate and it shows in the number of road and auto safety apps it makes available. These cover everything from finding parking spaces to calling up a taxi to making it easy to add money to your Nol Card–a multimodal electronic ticketing card–and Salik tag–the device mounted on the windshield to gain access to the electronic road toll system. The UAE is devoted to a more connected, transparent government and it is constantly developing and encouraging the creation of new apps to support that goal.

United Kingdom and the pursuit of safer roads

m-Government example for the U.K.

The Government of U.K. offers 57 transportation-based mobile apps out of 404 total. Public transit is a large part of the country, which is the focus of most of these–timetables, routes and so forth. There are also a sizable number of downloadables that offer information on areas or roads that have a high collision rate as well as updating on accidents that may be holding up traffic. Vehicle fatalities have increased in the country and this focus reflects the desire to address the situation.

The U.S. takes m-Government federal, state and local

U.S. take on m-Government

U.S. government mobile apps are available at the federal, state and local level. As with the other countries engaged in m-Government, the goal with all of the apps is to streamline processes for residents. It is why certain organizations were created, such as GSA’s Mobile PMO and 18F departments.

To that end, individual states have an information technology advocate in The National Association of State Chief Information Officers (NASCIO). This non-profit organization represents all of the state chief information officers in the United States. It keeps abreast of information technology innovations and how those can best be used to support and challenge the CIOs to push the digital envelope in their home states. Part of its mission is to support and encourage mobile app development across different regions to create a more transparent and seamless process for citizens. Road and automobile apps are a large part of that, especially given the latest report on U.S. traffic fatalities released by the National Highway Traffic Safety Administration (NHTSA) and the government’s desire to work with autonomous vehicle makers in response.

Whether it’s looking for a nearby alternative fuel station throughout the country (Alternative Fueling Station Locator) or practicing for your commercial driver license test in Wisconsin (WI DMV Commercial Driver License Practice Test), traffic/vehicle-based apps are geared toward arming residents with information that will help them safely navigate the nation’s highways. The range of traffic-based transportation apps are vast in the U.S. and often work in coordination with private companies, especially those at the municipal level.

Open government data for app development

Apps like Citymapper by Citymapper, Ltd. help you navigate and stay up to date with the mass transit systems throughout some of the world’s most complex cities. Hong Kong’s One Click by SAHK teaches social skills to children with developmental disabilities. Both are examples of public-private partnerships in government mobile app development.

Citymapper, Ltd. is a privately owned app development company that works with government agencies to gain access to infrastructure and public transportation information. The Citymapper app covers 40 cities around the world and communicates with users in 12 languages. SAHK’S One Click is available in English, Simplified and Traditional Chinese. It is listed on the Government of Hong Kong mobile apps area under “For Students of Special Educational Needs” and is part of its m-Government directory. These, like many other mobile device interfaces, exist thanks to governments opening up their data to private companies for app development.

This farming out of development helps diversify and expand the public information presented to residents in the most efficient way. The business of government is not in creating digital interfaces, just as tech companies aren’t expected to know everything about enacting policy. By the two partnering, each one gains the benefits of the other’s expertise to develop and offer more user friendly, beneficial information sharing to citizens. This linkage promotes continued app development across a variety of needs, which is the direction the entire world is moving.

The future state of Government 2020

layering on m-Government

Deloitte University Press presents an extensive look at the future of government on its Explore the Future of Government 2020 website. It evaluates future growth across two categories–Drivers and Trends–and how the two combine. Deloitte explains the difference between the two in this way: Drivers are factors “that change the context in which government operates;” Trends are “shifts that result from the drivers of change.” The information presented gives a detailed look at the unique ways these work together to create a different landscape in the next few years. This also includes the area of Transportation and the pivotal role digital and mobile play in the services and systems government offers the public.

A constantly shifting digital landscape

2020 is just a few years away and lawmakers are already realizing mobile’s potential for reaching its citizens and streamlining their lives. M-Government isn’t meant to replace but to link with eGovernment. It’s no longer a question of whether mobile applications will be embraced by public agencies, but how quickly they can be created to address the constantly changing needs of the people they serve.

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Telematics: The Bridge to Your Connected Car

Telematics enables screen in carFrom automatic crash notification (ACN) to fleet management, Telematics is the “connection” that makes the connected car a wireless marvel of the automotive world.

Telematics is a hot topic these days. With the current focus on self-driving vehicles, connected cars, cyber security, and especially, rising levels of traffic fatalities, the communication network that makes it possible for your automobile to move and react on its own is rapidly innovating. Telematic solutions are more readily available for all vehicles and even mandated as standard in some countries. The technology’s origin is oddly similar to that of the Jeep, and its integration into day-to-day life has been as seamless as that ubiquitous, stalwart vehicle.  But what exactly is telematics?

The term “telematics” is a translation of “telematique.” This was coined by two French scientists in a 1978 report to the French government on the computerization of society. They combined “telecommunications” with “informatique.” Per the Oxford Dictionary, it is defined as “the branch of information technology which deals with the long-distance transmission of computerized information.” And this brings us to its origins.

U.S. armed forces initiative goes globally civilian

The United States Navy began experimenting with satellite navigation to track its nuclear submarines in the early 1960s. By using the “Doppler Effect”–shifts in the satellite’s radio signal–captains could accurately find a sub’s location in minutes. The Department of Defense (DoD) then took what naval scientists had learned and launched its first Navigation System with Timing and Ranging (NAVSTAR) satellite in 1978. By 1993, it included 24 satellites and became the Global Positioning System (GPS).

Today, GPS is owned by the U.S. Government and run by the United States Air Force (USAF). It operates on two different levels to accommodate the separation between military/government use and worldwide access: Precise Positioning Service (PPS) and Standard Positioning Service (SPS). PPS is accessible to U.S. Armed Forces, U.S. Federal agencies, and selected allied armed forces and governments. SPS is globally available to any and everyone free of charge.

A global collaboration

While GPS was being created in the United States, the European Parliament was seeking systems to achieve better road safety. They established a resolution in 1984 to investigate solutions, inviting the European Commission–a body representing the interests of all European countries as a whole–to suggest appropriate research. Studies began around current and future innovations in telecommunications and informatics to discover what, if any, possible application there may be. One of these was the GPS. Over the next several years, telematics evolved as a way to improve the following: road and vehicle safety, environmental impact, and transportation efficiency.

The European telematics solutions expanded upon the U.S. based GPS technology to create something wholly unique–a vehicle tracking and support system beyond turn-by-turn navigation. It took the information gathered via satellite and interfaced with the electronic control unit (ECU) in a car. This made it possible for the system to digitally sense not only where automobiles traveled, but how they behaved and the different situations they may encounter.

The first car company to propose driver assistance technology for its customers was General Motors (GM) and it wasn’t OnStar.

A 30 year-old vision realized 20 years ago

some auto brands with OEM telematics

OnStar was unveiled at the 1996 Chicago Auto Show and first offered to customers in the production models of 1997 Cadillacs. The system was the first time vehicle embedded telematics was broadly available on the market, but it wasn’t the first time GM pursued driver assistance technology.

Driver Aid, Information and Routing (DAIR) is a system that GM engineers designed in 1966 that was then installed in two prototype vehicles and used punch cards to aid with turn-by-turn navigation. The gaps on the cards represented the basic directions needed on a specific route. This made it possible to drive to a pre-chosen destination without a map. But DAIR didn’t stop there. It also proposed restructuring America’s roadways by burying magnetic sensors beneath the pavement. These sensors would receive communications on highway conditions and accident reports from relay stations set-up all over the country. This information would be sent to drivers via a Visual Sign Minder–a basic heads-up display–mounted on their dashboard. It was recommended as a response to the rapid highway expansion of the era.

Per the DAIR brief, “Today’s complex roadways, increased vehicle speeds and heavy traffic intensify the driver’s need for frequent directions and information. DAIR meets this need for increased safety and driving enjoyment with a simple, low-cost communications system.” Because of the extensive infrastructure overhaul that was required to bring the idea to life, however, DAIR never got beyond prototype. GM kept working and activated its 1960s vision 30 years later with OnStar.

Telematics OEMs and stand-alones

where OEM telematics are installed

The initial OnStar was a classic case of telematics original equipment manufacturer (OEM) implementation. An OEM is usually defined as parts from one manufacturer used to create an overall product sold by another. In the case of transportation it reflects vehicles coming off the factory floor with the automaker’s proprietary technology already installed. Per The Global Automotive OEM Telematics Market, a study conducted by Berg Insight, the number of OEM embedded systems will hit 159 million globally by 2020.

The reason for this push is primarily safety and many of the rooted systems will be rudimentary “first responder” based, such as the ACN telematics of Europe’s eCall and Russia’s ERA-GLONASS. By 2018, all cars in those two regions are mandated to come off the assembly line equipped with a telematic system built to react to accidents in two ways. The first is by automatically sending a signal to E112–Europe’s 911–when a connected car is involved in a crash. The second is by a motorist pushing a button on the telematics enabled dashboard to alert E112 of a collision or incident they’ve just witnessed. It’s a way of ensuring all drivers are protected–whether they have telematics or not.


In 2012, GM decided to make OnStar’s basic features available to everyone and created OnStar FMV (For My Vehicle). This dongle-based solution joined other systems– such as Verizon’s hum–that work through a car’s onboard diagnostics (OBD) portal. These standalones allow you to plug the telematic device into your OBD port and upload software into your car’s ECU to gain such benefits as navigation, hands-free calling and automatic crash notification (ACN). What it doesn’t give you that OEMs provide are more advanced features like unlocking your car via satellite.

The new world of usage-based insurance (UBI)

This telematic solution is also the brain behind usage-based insurance (UBI). UBI means exactly what the acronym stands for–usage-based insurance policies and premiums. Instead of crafting policies and charging motorists through statistics and analytics, UBI calculates based on how someone actually operates his or her car. Because the device is plugged into the car’s OBD, it gathers and sends driver behavior data back to insurance carriers. This has made it possible for policy flexibility and leads to charging more accurate rates and lowering costs for drivers who are at less risk.

Mobile telematics data gathering

The future of telematics has to do with mobile data gathering. Your smartphone is now able to collect the same information that was only available via OEM or dongles. Verizon’s hum is an example of a three-way system–speaker, OBD reader and cell phone. The speaker works like OnStar, which allows you to contact live emergency services with the touch of a button.

Drivewell from Cambridge Mobile Telematics, on the other hand, is testing mobile telematics technology that tracks your driving behavior with or without a “wireless tag device.” The optional  attachment fits on your windshield and sends the telematics data captured by your smartphone to either the company for diagnostic purposes or to your insurance carrier. The company has also added a unique gaming aspect to their telematic service by creating safe driving competitions and incorporating leaderboards. A recent trial in South Africa–where the traffic fatality rate is among the highest in the world–showed a 30 percent increase in better driving due to the play factor. It’s one of many data gathering software options showing more expansive ways the technology can be used in the non-commercial space. But telematics has long been an invaluable tool in commercial fleet use.

Fleet vehicle tracking with telematics

fleet of trucksVehicle telematics play an essential role for fleet management. The systems keep costs down, productivity up and drive the overall efficiency of commercial transportation by tracking vehicle movement, its status–does it need gas? Is it time for maintenance?–driver behavior and more. By attaching a telematic unit to each truck that wirelessly connects to a central hub in the fleet’s business office, managers can track the vehicle’s location, manage performance and monitor conditions for driver safety and protection. Incorporating the technology in the commercial vehicle industry has modernized it and made it a more efficient business.

These telematic devices are excellent commercial partners and have also been embraced by the U.S. government to help it manage the vast fleet of the General Services Administration (GSA).

Example of connecting cars to government with GSA

The GSA offers workspace to over 1 million federal employees, manages the preservation of 480+ historic buildings and handles the purchase and distribution of goods and services used by the federal government. Part of this agency includes GSA Fleet, which has been providing motor vehicles to 75+ participating agencies since 1954.

As of 2016, all GSA Fleet vehicles available for purchase have OEM telematics while lessees can choose installing a non-OEM telematic device. To better streamline this technology, GSA shifted from working with two different providers and awarded AT&T Mobility the Blanket Purchase Agreement (BPA). AT&T’s two-tiered solution–simple GPS vehicle tracking and full diagnostics–enables the federal government to keep tabs and maintain their spread out automobile inventory more efficiently and consistently.

Flexible and expansive path to safer, more efficient driving

Telematics are capable of everything from sending information back to auto insurance carriers to affect your premiums to automatically alerting emergency services when you’re in need of roadside assistance. What began, basically, as the GPS has grown to include such things as infotainment, hands-free calling and vehicle-to-vehicle (V2V) communication. Companies all over the globe are embracing the technology in strategic and actionable ways.

In June, Visiongain released a report on the Top 20 OEM and Non-OEM connected car companies entitled Top 20 Connected Car Companies 2016: Leading Suppliers of Automotive In Vehicle Telematics By Service Provider Featuring Technologies For Safety, Security, Infotainment, Remote Diagnostics & Vehicle to Everything Communications. The 181-page report outlines the different strategies, strengths and futures of each company. Per the report, the companies to watch in both categories are as follows:

Top 10 Telematics OEMS


Daimler AG

Fiat Chrysler Automobiles (FCA)

Ford Motor Company

General Motors

Honda Motor Company


Toyota Motor Corporation

Volkswagen Group


Top 10 Telematics Non-OEMs

Apple Inc.

AT&T Inc.

Broadcom Corporation

Google Inc. (Android)

Qualcomm Inc.


Sierra Wireless

Tech Mahindra Ltd.

Verizon Telematics

Visteon Corporation

Outlook for the future

As automobiles become more autonomous, the technology that enables their interaction with infrastructure and each other will continue to innovate. Moving forward, more governments will continue flexing auto legislation muscles to ensure vehicles driving on their country’s roads are the safest and most efficient–for the environment, motorists, pedestrians, cyclists and economy. This means expanding, innovating and pushing telematics even further as cars become smarter. It is the bridge that puts a zero fatality, eco-friendly future within our grasp.


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