What Is Telematics?

In the fleet and logistics industry, telematics is considered synonymous with fleet telematics or vehicle GPS tracking systems.


You may have heard the term telematics—you may have been told it will make your job easier, and may even be
using it without realizing it.

You may even know that it is the foundation of modern fleet management. If you want a technical answer to the question what is telematics, it's a system that uses telecommunications and information technology or processing for generating actionable data.

In the fleet and logistics industry, telematics is considered synonymous with fleet telematics or vehicle GPS systems. By this definition, it is an onboard communication system and applications that talk to each other via the mechanisms of GPS receivers and other telematics devices.

The most common use of telematics in fleet management is vehicle tracking. By combining a GPS tracking system with onboard diagnostics, the exact location of a vehicle and the speed at which it is moving can be mapped.

A telematics system consists of devices installed inside the fleet of vehicles. These devices use a cellular network to send information to services that are hosted by the provider or a third-party cloud server. The data can then be accessed from a device such as a smartphone, tablet, or laptop with an internet connection. This is all made possible by the Global Navigation Satellite System (GNSS).

These developments have caused a boom in telematics for fleet management. Fleet managers use telematics to keep their drivers compliant with the ELD mandate and to help run their fleet operations more efficiently.


Any type and size business with vehicles or assets they want to track can benefit from telematics. Here is an overview of some industries the rely on GPS fleet tracking and telematics:

Public Transport
oil & gas
transport & distribution
Fast moving consumer goods

Everything you need to know

Telematics data can empower fleet managers and administrators by giving them the ability to solve their unique business challenges and make strategic and informed decisions. 

    A fleet management telematics system consists of devices installed in fleet vehicles in order to send, receive, and store telemetry data. It connects to a vehicle's onboard diagnostics system or CAN-BUS port with a SIM card. An onboard modem sends information via a wireless network.

    The device collects GPS fleet tracking data and a range of vehicle-specific information and sends it to a centralized server via General Packet Radio Service (GPRS), 4G (soon to be 5G) mobile data and cellular networks or satellite communication to be stored on a server. The server receives the information and displays it through a secure website accessed through tablets or smartphones. A telecommunications company manages the information flow between the vehicle and the telematics provider.

    The device can capture information such as location, speeding, harsh acceleration or braking, idling time, fuel consumption, engine health, and more. When reviewed and analyzed, the information can give you in-depth insights across your entire fleet.


    Fleet management lets you harness the power of data and apply it to your unique business challenges. The most common challenge for fleet managers is knowing the whereabouts of the vehicles in their fleet, as well as their equipment at all times. There are many examples of companies using a telematics solution to deter theft, saving thousands of dollars. Initially, the main benefit of this technology was its ability to locate vehicles and relay that information through a wireless connection virtually in real-time. However, the technology has evolved to offer valuable features, such as safety, efficiency, and savings for your fleet.

    For example, if you want to develop a fleet safety initiative with the goal of becoming a safer and more responsible fleet, you can use telematics technology to do so. It can help you address bigger issues such as reducing speeding instances, harsh acceleration and deceleration as well as the number of accidents throughout your fleet.

    Telematics can also give you a significant return on investment (ROI) in areas such as:

    • Improving customer service
    • Cutting fuel costs
    • Reducing operating expenses
    • Increasing efficiencies

    When you install a telematics device in your fleet vehicles, you may wonder what is behind all that technology. Picture an extremely intelligent computer that can track and report on almost every detail from speed, braking, and idling to low tire pressure, fuel usage, and more. This information can lead to better monitoring of vehicle health and learning more about driving habits throughout your fleet. You can then use this information to save on maintenance costs, improve fuel efficiency, and create driver training programs.

    In order to track assets, information from your fleet vehicles is recorded via a device installed through the CAN-BUS port or OBD II. The device contains a SIM card and modem that enables wireless communication on a cellular network. The final piece is fleet management software that can be accessed through a smartphone, laptop, or tablet.


    The combination of telecommunication and information processing that we know as telematics was developed in the 1960s for military use to improve communication on the battlefield. The technology we use today came about through three interdependent breakthroughs: Internet, GPS, and machine-to-machine communication. Fleet management applications of telematics took off with the rise of the Internet and the increase in the number of telecommunications networks to transfer data in real-time.


    These devices can be self-installed (plug and play) or installed by a technician. Either way, getting up and running can be quick and easy. Their power requirements may vary, some may be battery operated while others may be powered by the vehicle's internal electrical system.


With advanced telematics systems and the amount of data they can collect and store you can simplify operations, improve driver management, and see a significant ROI. Here are eight benefits for fleets of all types and sizes.
  • Increased fleet efficiency and productivity

    Telematics provides you with real-time vehicle location updates so you can identify the safest and most efficient routes to speed up deliveries, improve road safety, and reduce fuel expenses. In addition, you can use geofencing to track performance against schedules and find out why any delays have occurred.

  • Improve fuel usage and operational expenses

    Smarter route planning helps you improve fuel efficiency and save money. You can also automate things such as tracking idling time and vehicle utilization rates. You can rank drivers and determine who needs coaching. By identifying drivers who need coaching to reduce idling and aggressive driver behavior, you can cut down on your expenses.

  • Vehicle tracking

    Your vehicles can be accurately tracked through a combination of GPS satellites and receivers, GPRS networks, and cloud computing. Once you install a telematics device, a GPS receiver can download information from GPS satellites. It is then processed and transmitted via GPRS to secure servers where it can be accessed and used to reroute and send the nearest driver to a new job.

  • Trailer and asset tracking

    Telematics is for more than just vehicles. You can attach a GPS tracker to trailers, expensive equipment, and non-motorized assets to make sure they don't get lost and find them faster if they get stolen. You can also set up alerts that are sent to your mobile device if a trailer or other non-motorized asset is moved without proper authorization.

  • Maintenance improvements

    Fleet management telematics can help you improve fleet vehicle maintenance throughout the vehicle's lifecycle. With telematics you can monitor hours-of-use and use the information to schedule preventative maintenance, thus preventing excess wear and tear that can lead to unexpected breakdowns. Using engine diagnostics provided by telematics devices, you follow a preventative and predictive maintenance schedule that keeps vehicles operating safely. You can monitor battery voltage, intake valve problems, coolant temperature, oxygen sensor issues, powertrain malfunctions, and more.

  • Safety tracking

    With telematics technology you can monitor vehicle location and speed, harsh driving and other aggressive driving behaviors as well as seatbelt use. You get a digital record of every facet of your fleet vehicles' operations, information that can give you insight into where and what improvements can be made to prevent accidents and improve driver safety.

  • Streamlined communication

    Telematics can streamline communications between drivers and fleet managers or administrators. Improved communications paired with accurate vehicle location and geofencing can help you more accurately estimate arrival times and improve your customer satisfaction. In competitive industries, customer service is often the differentiator, and if your customers aren't happy, they can easily take their business elsewhere. Streamlined communication and real-time vehicle tracking can give you a competitive advantage.

  • Better payroll management

    You can reduce instances of overtime and timesheet fraud with a telematics solution. By monitoring your fleet's electronic time logs and allocating your resources based real-time information, you can lower the amount of overtime across your fleet. You can optimize your drivers' routes, so there is no wasted driving time. You'll also know precisely how long and how far a vehicle was driven, making payroll easier to calculate.

learn more about the
benefits of telematics


A bare-bones GPS tracking telematics solution is relatively inexpensive but gives you very little actionable insight. A fully integrated telematics system that includes dash cams, electronic logging devices (ELDs), route planning, and advanced driver management may cost more upfront but can give pay off in more ROI. And there are systems like MiX Telematics, where you can choose features based on the needs of your fleet.

Better visibility into your fleet gives you insight into how your assets are being used and how you can optimize them. Customizable dashboards make it easier to review progress towards KPIs that you choose, manage your budget, and access real-time analytics from your telematics system. A fleet management system can help you find hidden costs and increase efficiencies and productivity.


Telematics is fast becoming an essential component of fleet management. Many fleets that have used telematics have seen that it can pay for itself in improved efficiency, productivity, and safety. It is poised for increased growth as new applications are developed to keep up with developments in GPS technology and increased use of mobile devices. The emergence and widespread adoption of the Internet of Things (IoT) making technology possible for smart homes and smart communities are examples of the rapid evolution happening in this space. As telematics continues to gain momentum, it will continue to evolve, and there are some emerging trends to watch for the future.

Areas of telematics innovation include:

  • Big Data
  • Machine Learning
  • Artificial Intelligence
  • Video Telematics
  • 5G Network

GPS vehicle systems will continue to become better integrated with other operational systems as fleet owners increasingly look for integrations with their systems for workforce management software, business management software, and ERP software. Telematics increasingly become an integral component of fleet management operations.


Fleet management telematics will continue to play a big role for fleets who want to gain a competitive edge. MiX Telematics solutions provide GPS tracking for vehicles and assets, ELD compliance, safety, and security. If you're looking for fleet management telematics software, contact us and we'll be happy to help you find a telematics solution that is right for your fleet.

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