Contractors Initiate Fundamental Change in Equipment Costs

The CONEXPO 2014 announcement of a standard for communicating equipment-telematics data marks a paradigm shift destined to change the competitive-bid playing field

One common theme to many equipment makers' CONEXPO 2014 pitches was telematic technology. Almost before they were talking about iron, the major manufacturers were all promoting technology that connects managers with machines in the field, improving productivity and uptime.

We've been convinced for at least ten years that monitoring systems designed to wirelessly report machine location, hours, fuel level, performance parameters and fault codes can dramatically cut ownership and operating costs. For five years several major manufacturers, starting with Komatsu, have been installing telematics hardware as standard equipment and offering the data service at no additional fee.

As announced at CONEXPO, equipment buyers finally got together to address the reason telematic systems have not yet revolutionized equipment costs.

The biggest barrier to adoption and effective use of telematic data in fleet management has been the fact that each brand of system operates in a silo. An equipment professional had to visit the different web sites or applications for each manufacturer represented in his fleet to get the information, and could not roll up the data to easily manage a mixed spread of loaders, excavators, pavers or work platforms.

A coalition of big fleet owners lead by Oldcastle's Ron Piccolo and including AMECO and the major rental companies such as United Rentals and Sunbelt, got together with the Association of Equipment Management Professionals to seek a solution. The parties engaged with the Association of Equipment Manufacturers to expand a data-reporting standard that would greatly simplify aggregating data from disparate telematics systems into fleet owners' management systems.

The new AEM/AEMP telematics standard announced at CONEXPO 2014 creates a standard communication protocol for 19 common data points and 47 fault codes that most machines generate today. Data from telematics suppliers who employ the standard will be easy to compile in a single fleet-management program, or integrated into enterprise management systems.

While the idea seems esoteric at this level, don't miss the significance: with all of an equipment fleet's data available in one program, equipment managers will have unprecedented visibility to very specific machine operating data. Many will use this data to slash waste from machine operations -- excess engine-idling time, unreported operating hours, machine abuse, over- and under-servicing of machines -- and improve productivity by right-sizing fleets and coaching operators. Early adopters will fundamentally change expectations for operating cost. And they will field more competitive bids.

This will inevitably become a real paradigm shift; a shift initiated by equipment buyers and revealed at CONEXPO 2014.

CONEXPO 2014 Reflects a Construction Economy Flexing its Muscle