Remove the Risk
Truck leasing is often chosen rather than purchasing these assets. Your goal is to maximize your ROI on any investment you make. Most leasing companies bundle telematics technology with the lease. This makes truck leasing expensive and keeping your negotiating power is important. Every advantage you give up could cost your company thousands of dollars over several years.
Telematics provides many benefits when fully utilized. Benefits include 5 general areas which are maintenance, safety, productivity, compliance and service. The issue with most truck leasing companies is that they do not give the fleet manager access to all the data. Truck leasing, or vehicle leasing, companies are interested in your fleet maintenance first. They control the data you can access from within their user interface.
Life Partners, Like It or Not
Once the vehicle leasing company brings your data into their systems you are partners for life. If you want to use another provider or simply want to end your service, you are stuck because the telematics service is tied to the vehicle lease.
Leasing companies want to wrap all the services available into a single package. Leasing companies realize once you accept their bundled service it is almost impossible to do not be held hostage, negotiate or pay market rates for consulting services. We often hear customers say they want one bill.
Truck Leasing Negotiations
Considering the number of bills paid each month, another bill is inconsequential. Negotiating the vehicle lease independent of the telematics enables you to negotiate a more reasonable price for the telematics technology. Breaking it out prevents the sales rep from “burying” the telematics cost in the price of the lease even though you are paying 1-20% more than the market rate.
Another thought on including telematics in a vehicle lease is that it becomes a tax write-off and there is no capital investment. This holds true for telematics services as well with similar lease, or SaaS, models. The reality is that if you do not buy the equipment you will pay a 100% markup over three years on a lease plan. The markup exceeds the tax benefit. No matter how you look at it, the benefits are available if you purchase telematics from a company other than the truck leasing provider and your negotiating position is much stronger.
Truck leasing companies often charge you to use the telematics data which they in turn use to save them money. The data has about a $3 per month, per vehicle value to the fleet leasing companies maintenance program yet you are paying them market rates for it. This is a good deal for the leasing company but weakens your position and costs you money.
Eggs In One Basket
When you have all your technology with a single provider you reduce or even eliminate your negotiating power. Fleet leasing companies consolidate services but charge a premium price and give you few options to maximize other benefits. With GPS tracking there are other integrations you may want to do but since you do not have access to the data you are limited. If the leasing company can provide it, they will likely charge for it when you would otherwise get it for free.
Without data access you cannot:
- Integrate with other systems
- Use partner add-ins
- Use API for free
- Get productivity data
- Get compliance data
- Generate custom reports
- Set alerts in GPS UI
- Archive, move or share data
- Terminate telematics without impacting vehicle lease
Review Pros & Cons of Truck Leasing with Telematics
FleetisticsGPS & Telematics Only
- Volume discount on telematics
- Tax savings – buy or lease options
- Teach you to manage telematics data
- Smaller and more nimble
- National presence
- Full access to all data
- Free API for integration
- Ability to switch resellers
- Backup and restore option
- Control cost with in-house developers
- Integrate with any system or partner
- No added fees to move or share data
- Share data with fleet leasing company, Free
- Personal service, not a call center
- Experts in telematics, not a secondary job
- Value added services available
- Volume pricing for service and parts
- GPS in vehicle lease price
- Tax savings
- Might manage telematics data
- Big corporation
- National presence
- Missing data on: customer service, routing, productivity, safety, custom rules
- Fees to integrate with other systems or applications
- No direct access to data
- No option to switch GPS providers
- No control over costs or ability to negotiate costs
- Customization or integration is slow and expensive
- Additional fees to use GPS or telematics data by leasing company
- Techs are ASE mechanics, not telematics experts
- Never reach same person twice
- Business Analysts not available or fee-based
- Data obscured when combined with leasing company data
- Custom development costs at premium rates
- Add-on limited – No GPS system UI for add-ins
Truck Leasing Companies
Click the links below to view various fleet leasing company websites. You will see several common variables that should validate many, if not all, of the points made above. Vehicle leasing is not a bad value for everyone, but everyone should be clear on the pros and cons so they can make the best decision for their company.
Several common aspects to note:
- The user interface is not that of the GPS product and nowhere do you get direct access. Data is brought into the portal of the fleet leasing company and they give you what they want you to see. Because you do not have direct access, you can never leave and have no negotiating power. You will therefore pay premium rates.
- The scope of the online telematics data represents the importance and focus. Fleet leasing companies are maintenance companies first; it is where they make the most money.