Smart Fuel Buying, Smart Fuel Use
How fleets are applying technology to ease the fuel $$$$ squeeze.
John Bendel
Technology Editor
Every fleet was squeezed by fuel costs last year, and the pressure continues. Many fleets are applying technology to ease the squeeze — information technology both to find the best prices for fuel and to get the most out of that fuel.
Perhaps the hottest technology is route optimization for fuel purchases, particularly in the truckload sector. Most private fleets and virtually all LTLs fuel at a terminal or central starting point. Truckload carriers have no choice but to fuel on the road. As a result, many use software to take advantage of price differentials at truckstops.
Probably the largest fleet optimizing routes for fuel purchasing belong to Schneider National of Green Bay, Wis.
SCHNEIDER INTEGRATES FUEL ROUTING
"We purchased a software package from IDSC out of Dallas," said Todd Jadin, Schneider's operations VP.
IDSC stands for Integrated Decision Support Corp., which offers a suite of transportation software products including Expert Fuel, an application that cherry picks the best fuel prices along a given route, then provides a stop-by-stop, gallon-by-gallon plan for fuel purchases.
"We integrated it with our home-grown transportation management system, which is based around the Qualcomm system. We dropped our own network of fuel centers in there along with their fuel network," Jadin explained.
Schneider has a network of 32 facilities at strategic interstate crossroads around the country, all dispensing fuel.
"Our bias in the software is toward running our trucks through the operating centers, because that's our lowest-cost fuel. Then we have relationships with around 400 fuel stops throughout the U.S. where we negotiate volume pricing. They are the other stops built into the IDSC routing engine."
Jadin said fuel routes are generated automatically at the time of dispatch and sent to drivers over Qualcomm's OmniTRACS mobile communications system.
Truckload carrier C.R. England Inc. of Salt Lake City, Utah, also uses IDSC software.
SAVES CENTS PER GALLON
"It's all automatic," said Corey England, VP Operations. "If it took a lot of dispatcher or management involvement, it probably would not work. It needs to work on its own. At the time of dispatch, a route is created. The optimizer knows the pricing on a daily basis, then it creates the stops and that is automatically sent to the truck."
Expert Fuel actually runs on a PC that talks with virtually any other computer system through TCP/IP, the universal protocol that underlies the Internet. An England employee constantly tweaks the company's fuel network, ensuring that only the most advantageous providers are in the authorized network in the first place. Even then, Expert Fuel saves the carrier an average 3 cents per gallon, according to England.
But an average is just that. It doesn't apply all the time in all parts of the country.
"It depends on the marketplace. You have markets where the competition is such that the optimizer doesn't do you a whole lot of good," he said.
Another variable to consider is driver compliance with designated routes. Of course, drivers can use fuel stops on the authorized network other than the ones recommended by Expert Fuel for a particular trip. But the greater the driver compliance, the greater the savings. Driver compliance is on the rise, according to England
"Currently we run about 80% compliance," he noted.
Prime Inc. has seen increased driver compliance as well. The truckload carrier, based in Springfield, Mo., uses another system for fuel routing optimization — Fuel & Route, a module of the Carrier Management Suite from Manhattan Associates of Atlanta, Ga. Karen Brigham, director of technology at Prime, says Fuel & Route works with an approved network of 500 fuel locations.
PRIME OFFERS FUEL SAVINGS TO OWNER OPERATORS
When they first began using Fuel & Route, the Prime fleet consisted entirely of owner-operators.
"In the beginning, of course, you're working out the bugs, making sure you have the right parameters. We had a lot of input from operators then. But once we worked that out, acceptance grew," Brigham said.
"Now the owner-operators seem to love it. They don't always conform to it 100%, but there is very high usage. We found that some of the people with more experience, who may have run a trucking business, were better at buying fuel, so the savings wasn't as great as we had expected. But people at the other end of the scale — who had a higher fuel cost — saw a substantial savings."
In the case of owner-operators, the savings don't accrue to the carrier.
"The return really goes to the operator," Brigham explained. "Where Prime benefits is if the drivers are doing a better job of running their business, they're more likely to stay with Prime."
More recently, Prime has added company drivers. About 500 of the company's 1,900 drivers are in that category, and they are required to observe Fuel & Route selections.
Prime updates its fuel price matrix based on real-time reports from Comdata, the fuel card and transaction company based in Brentwood, Tenn.
"They send us the last known price as of yesterday. As our drivers go into stops and get fuel, Comdata sends us the transaction in real time. If the price has changed, we update to the most current price. We do it four times a day," Brigham said.
Information technology helps get fuel at the best price. It also helps drivers get the most from the fuel they buy. For example, many major truckload fleets use a Qualcomm application called SensorTRACS.
SensorTRACS interfaces with a truck's onboard data bus to gather RPM, speed and idle data. The information is delivered at customer-defined intervals or on-demand over the Qualcomm mobile communications systems without any action on the part of the driver. The data is also displayed for drivers in real time, so they can modify driving habits immediately to meet company goals.
C.R England downloads SensorTRACS data every week to monitor driver performance. Schneider does it every two weeks.
"We found that over the course of a two-week period we got quality data. Then we have driver bonuses tied to that performance," said Schneider's Jadin.
Fleets are also looking to non-digital technologies to increase fuel efficiency. For example, both Schneider and England are installing cab heaters to cut down on idling. Both are testing super-single tires, anticipating increased fuel efficiency among other benefits.
HELP FOR SMALL FLEETS
The technologies used by these big carriers are also available — in slightly different forms, perhaps — to small fleet and individual owner-operators.
Take the routing for the best fuel prices: According to IDSC, fleets of 100 trucks or more should license Expert Fuel to run on their own computer. However, smaller fleets can get the same kind of expertise over the Internet at www.fueladvice.com. For $9.95 per month per truck, any trucker can generate fuel optimized routes based on up-to-the-hour fuel pricing at pumps around the country. Fuel routing solutions are also available from other vendors.
SensorTRACS can be used by Qualcomm customers, but other driver and vehicle monitoring systems are available to operators with or without mobile communications from suppliers such as Nexiq, Abbot Enterprises, Centrodyne and others.
In addition, many of Qualcomm competitors offer vehicle monitoring combined with mobile communications. That includes suppliers like PeopleNet, Aether Systems, Cadec, Tripmaster, XATA and many others.
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