Telematics 101: Connecting Cars, Data, and the Road Ahead

Custom image what is telematics

Telematics technology is the fusion of telecommunications and informatics.

This term is often used in fleet management and refers to vehicle use, maintenance requirements, and automotive servicing data.

But, really, what is telematics, and how does it work?

Let’s look at everything surrounding telematics navigation to determine what you need to know.

What is Telematics?

Telematics enables businesses to remotely monitor and collect data about vehicle locations, driver behavior on the road and activity, maintenance status, and more.

Some people mistake telematics for GPS, but there is much more that goes into it.

Fleet telematics data help you manage your resources efficiently, reduce costs, improve safety, and increase productivity.

Want To See For Yourself How Route4Me Can Help You Leverage the Benefits of Telematics?

Whether you want to slash the time it takes you to plan routes for your drivers, increase the number of stops they can make, or keep your customers satisfied knowing that your drivers show up on time… Route4Me helps you achieve that!

The History of Telematics

The telematics concept has been around since the 1990s, but it gained momentum in the 2000s. 

Businesses primarily used the early version of telematics systems for basic vehicle tracking and navigation.

However, the widespread accessibility of GPS technology helped improve telematics capabilities. In the mid-2000s, many commercial fleets had telematics integrated for route optimization and vehicle monitoring.

The growth of smartphones has made telematics even more popular. Today, many businesses across several industries, from logistics to insurance, use telematics systems to track and manage their fleet operations.

How Does Telematics Work?

Telematics devices primarily get data from Global Positioning System (GPS) technology. GPS is supported by dozens of satellites maintained by the US military.

The GPS receiver of the telematics device installed in the vehicle receives signals from these satellites to pinpoint the vehicle’s exact location.

Alongside the GPS receiver, telematics data is also collected with the help of sensors. Sensors within the telematics devices can capture driver activity data, such as vehicle speed, harsh braking, and erratic cornering.

It can also monitor any activity inside the vehicle, such as when a door is opened, the tail lift is raised, and even the temperature.

Also, the installed telematics devices provide engine data on odometer readings, fuel usage, and battery voltage to notify about vehicle faults.

The data is then transmitted over private cellular networks to the central server. The secure servers interpret the vehicle telematics data into simple visualizations that can be viewed in real-time via software for fleet vehicle management.

Custom Image - A Quick Guide to Telematics for Trucks

Benefits Of Telematics

There are many ways modern telematics systems can benefit service businesses. It all depends on what you want to improve in your existing operations.

Do you want to improve fuel efficiency?

Do you want to encourage safer driving practices?

Are you looking to optimize routes and avoid costly downtime from unplanned maintenance issues?

Are you looking to safeguard your assets against theft?

So, if you are wondering if vehicle telematics is worth it, here are some ways a complete fleet telematics solution can help you achieve your business goals.

Increase Safety

Aggressive driving, harsh braking, speeding, tailgating, and not wearing a seatbelt are some driving practices that can compromise the safety of your drivers and take a toll on your vehicles.

Unsafe driving practices could cost you a fortune in repair bills, insurance hikes, and legal fees, especially if they hit another vehicle.

Also, you are responsible for doing whatever you can to prevent the people working for you from getting injured while on the clock.

Telematics can provide real-time data on how your drivers operate your vehicles so you can be alerted to bad driving incidences.

By identifying such problems with driver behavior, you can address the root cause and take corrective actions, such as providing additional training to change your drivers’ driving behavior.

Furthermore, insurance agencies will be able to pinpoint your levels of risk, resulting in lower insurance premiums.

Accurately Schedule Assets

Telematics is not just about asset tracking. It also helps you plan your routes and resources more accurately. For example, by monitoring the use of each vehicle and driver, you can make informed assignment decisions.

Tracking vehicle and driver usage will also help you downsize or expand your fleet to match your customers’ demands.

Avoid Unplanned Downtime

When a driver is on the road, and their vehicle breaks down, the entire delivery schedule may get thrown off. Your customers will thus become upset, and you may have to pay for unplanned repairs and lose productivity.

By using telematics data from your vehicles’ on-board diagnostic (OBD) ports, fleet managers can track assets in real-time, pre-empting faults in vehicles and fixing them before they lead to downtime.

Improve Fuel Efficiency

Fuel costs are the most significant expense for any service or transportation business. A telematics GPS system can help you monitor fuel usage and improve fuel efficiency.

For example, it helps you detect idle time. And, if your drivers know that you are tracking their idle time, they will be more conscious of idling their cars and turning off their engines when stopping. 

Also, the security that telematics provides can help you reduce and even eliminate fuel theft.

Custom image how to prevent employee fuel theft


Improve Productivity

Telematics navigation can help improve the productivity of your business operations. Its GPS feature lets you plan to avoid traffic or inclement weather.

Furthermore, if any ad-hoc jobs arise, you can easily assign them to the nearest drivers who are best fit to handle them. The GPS navigation feature can help them get there.

Managers also love it because it can automatically record driver hours by logging exactly when the vehicle was switched on and off.

Ensure Better Payroll Management

With telematics, you can track when a vehicle begins a journey and when it ends. This helps you have an automated and precise record of your service rep or driver’s work duration.

It also helps you compensate your employees accurately based on their working hours. And the best part is you don’t need to spend hours manually matching up timesheets to job tickets.

Provide Accurate ETAs

Telematics lets you monitor your service reps’ or drivers’ whereabouts in real time. Therefore, you can give customers an accurate estimated arrival time (ETA) for service appointments or deliveries.


Telematics systems help reduce carbon emissions by ensuring that your entire fleet uses less fuel and resources to complete routes.

GPS vs. Telematics: What is the Difference?

GPS tracking is simply knowing the exact location of individual vehicles.

On the other hand, a vehicle telematics system uses GPS data as one of its tools.

GPS satellites and onboard diagnostics collect data on the vehicle’s location and current status and send them to a central computer to interpret them into useful information.

Aside from fleet tracking, it can also provide insight into vehicle odometer readings, fuel consumption, alerts on unauthorized truck usage, and other remote diagnostics.

Types of Vehicles Telematics is Best Suited For

Cargo Vans/Pickup Trucks

Cargo vans and pickup trucks will significantly benefit from telematics systems as they will provide valuable insight into their unauthorized usage and activities.

Heavy Equipment

Heavy equipment would do well to integrate telematics systems as they can be used to track utilization, reduce fuel burn, and even alert to preventive maintenance.


Telematics systems can be used for cars to monitor productivity, track mileage, and ensure safety compliance.

Buses & Coaches

Integrating telematics systems with buses and coaches is essential since these vehicles mainly serve others. Driver scheduling, behavior monitoring, and time of arrival notifications are among the features you can expect from telematics systems.

Single Axle/Tractor Units

Telematics can help with route optimization and fuel management for single axle and tractor units.

Specialist Vehicles

Specialist vehicles like dump trucks, tow trucks, and cement trucks will benefit from installing a telematics system. It will give you a better understanding of their activities, such as power take-off and mechanical power transfer.

How Much Does Telematics Cost?

The cost varies depending on the feature you need. It won’t cost much if you require basic vehicle tracking displayed on a map, but it offers limited actionable insight.

A comprehensive telematics solution that integrates with other technologies or solutions, such as dash cams and OBD scanners, requires significant investment but provides a better ROI.

However, every telematics system has three significant costs – hardware and installation charges, subscription fees for software services, and the expenses to manage the system efficiently.

Typically, any new vehicle comes with an integrated telematics modem compatible with various telematics services, either free or requiring annual subscriptions.

Renowned vehicle manufacturers like Ford offer free telematics services for electric and gas-powered vehicles.

How to Use Telematics in Your Fleet

Here is how you can use telematics in your business.

Vehicle Tracking

Tracking your vehicles in real-time can help you provide accurate ETAs to customers, making them happy and more business. Also, if you bill customers by the hour, having accurate data about how long your team’s vehicle has been parked at the work location is beneficial.

Custom Image - benefits of gps tracking concept

Track Assets

Telematics devices are also helpful for asset tracking. For example, construction companies use telematics to monitor valuable equipment and machinery often left on job sites.

Also, telematics systems help prevent equipment theft as they offer real-time alerts if a machine leaves an area without authorization.

Improve Maintenance

You can use telematics to monitor hours-of-use records and schedule preventative maintenance. It helps you stay on top of engine diagnostics, including coolant temperature, oxygen sensor issues, powertrain malfunctions, battery voltage, and more. This enables you to reduce downtime and maintenance expenses.

Safety Tracking

Telematics systems help you monitor speeding, harsh braking, seat belt use, distracted driving, or other reckless driving behaviors. This enables you to identify areas of improvement and coach drivers accordingly to reduce the risk of accidents and associated expenses.

How Route4Me Route Planner Can Help

Route4Me route planner supports integrations with various telematics providers and almost all types of devices. You can connect your drivers’ and team members’ GPS trackers, smartphones, or other devices.

Route4Me’s multiple stop route optimizer helps you effortlessly create and coordinate a fleet of cars, trailers, semis, trucks, vans, or other vehicles.

You can customize your vehicles’ parameters, dispatch routes to vehicles, monitor them on the map in real-time, track route progress, KPIs, idling, fuel theft, and more.

If you want to connect vehicles from a telematics provider currently not integrated with Route4Me’s route optimization solution, you can even request integration by submitting the request to Route4Me’s Customer Success Team. Also, you can either add manually or automatically import telematics vehicles from various telematic vendors.

Learn in detail about Route4Me’s supported telematics integrations.

Route4Me routing platform also enables you to monitor drivers with the help of its Android and iOS route planner apps. You can have your team install the apps on their mobile devices, and then the apps will send a GPS signal to the web platform every few seconds. This helps you monitor your drivers’ near real-time GPS locations.

You can also watch your drivers’ GPS tracking history movie and track multiple drivers simultaneously on the same map. You can even use Route4Me’s Activity Feed feature as a live driver chat.

Frequently Asked Questions (FAQs) about Telematics

What are the downsides of telematics?

One of the biggest downsides of telematics is its breach of privacy. Some of your drivers may feel iffy about being constantly monitored, even outside working hours when they’re simply driving home.

Why do people use telematics?

People use telematics to improve their fleet’s productivity and efficiency. It is also one of the best ways to improve driving safety because the constant vehicle tracking encourages drivers to be more careful.

On A Final Note

Telematics software systems are essential for fleet managers to improve their business’s productivity and efficiency.

Telematics can monitor and track the activity of their drivers and vehicles via a wireless network, which allows for improved communication between fleet managers and drivers.

Vehicle telematics systems can also track your vehicle’s health to minimize unwanted breakdowns on the road. Regularly scheduling vehicle maintenance is crucial in prolonging their lifespan.

Lastly, telematics navigation systems allow you to run your fleet most efficiently by providing optimized routes. You will save fuel and time to better spread your resources to do more jobs.

Want To See For Yourself How Route4Me Can Help You Leverage the Benefits of Telematics?

Whether you want to slash the time it takes you to plan routes for your drivers, increase the number of stops they can make, or keep your customers satisfied knowing that your drivers show up on time… Route4Me helps you achieve that!

About author: Rahul Dasgupta

Rahul Dasgupta is a content writer with over 20 years of work experience. He holds a master’s degree in computer science and has written thousands of blog posts on route planning and scheduling, making it easy for readers to learn about these complex topics. Rahul enjoys playing tennis in his spare time and loves cuddling with his pet labrador Shinu. Rahul is a big fan of Roger Federer, Messi, and Bill Gates - he admires their drive to be the best at what they do and their philanthropic efforts.


About Route4Me

Route4Me has over 40,000 customers globally. Route4Me's Android and iPhone mobile apps have been downloaded over 2 million times since 2009. Extremely easy-to-use, Route4Me's apps create optimized routes, synchronize routes to mobile devices, enable communication with drivers and customers, offer turn-by-turn directions, delivery confirmation, and more. Behind the scenes, Route4Me's operational optimization platform combines high-performance algorithms with data science, machine learning, and big data to plan, optimize, and analyze routes of almost any size in real-time.