Fleet dictionary: the meaning of 28 terms

Fleet management is an essential part of transport operations, whether freight transport or passenger transport. It involves many processes and, therefore, many industry-specific terms.

For those just starting to learn about logistics and road transport, understanding the main industry terms is fundamental to finding their way and beginning an in-depth study of how to handle management responsibilities.

Even those who are already managers or hold a role at a carrier may encounter new words and expressions over time. That is why it is always important to keep up with logistics market developments.

Take a look at the glossary of main terms we have prepared:

Fleet management

This concerns managing every area of a fleet, from vehicle purchases to tire care and refueling control.

The person responsible for fleet management must be a professional with practical and theoretical knowledge, as well as interpersonal skills, organization and logical reasoning to develop strategic plans and intelligent solutions to the problems and challenges the company faces.

Tire management

Tire management emerged a few years ago as a way to save on purchases of these expensive parts, which until then had low durability — not even reaching their 5-year “shelf life.”

Recently, it has begun expanding in Brazilian fleets as an essential part of the routine. After all, the results and impacts on fleet savings are very positive.

It also brings other terms you need to know:

Tire measurements (or tire inspection)

Tire inspection, or measurement, is the process of collecting tire pressure readings and measuring tread depth.

It is a process that can be performed entirely manually, with a caliper: the driver inserts it into the grooves, takes the reading personally and writes the numbers down on paper.

Or, digitally, an electronic tread probe is used. With this device, insertion into the grooves is still manual, but reading and data recording are fully automated in the tire management software.

Tire grooves

Grooves are the tire patterns, also called channels. They mainly help water pass through the tires, preventing skidding and hydroplaning. They also help air pass through, generating ground grip.

Normally, the deeper the grooves, the greater their resistance to road conditions.

In addition, at the bottom of each groove there is a TWI:

TWI – Tread Wear Indicator

In plain terms, it is the “tire wear indicator,” and its name is quite self-explanatory.

This indicator is a mark at the bottom of the grooves showing the maximum limit they can reach through wear — in Brazil, imposed by law at 1.6 mm.

Tire pressure

Tire pressure is indicated during calibration. Each manufacturer already performs tests and determines a recommended pressure for inflation for each tire model in advance.

Generally, these are accurate predictions, and driving at this pressure helps give the parts a longer useful life.

However, tire management involves weekly checks of pressure to understand how it may be accelerating tread wear. Adjustments are then made (up or down) as unusual changes are noticed.

Fleet maintenance

Fleet maintenance can both prevent problems and correct them. Here are the most common maintenance types:

Preventive maintenance

This maintenance approach follows a predefined schedule and uses vehicle inspection checklists usually created for each stage.

Vehicles are checked daily, on departure and arrival of each route, for the most important items, such as headlights, fuel level, tires and seat belt, among others. For long-distance trips, inspection should use a complete checklist, including all truck components.

Routine tasks are also performed through prevention, avoiding bigger mechanical problems. For example, tire rotation, wheel alignment and balancing, and engine oil changes.

If any failure is found that could compromise vehicle operation, the vehicle must be sent for corrective maintenance.

Corrective maintenance

In many fleets, this is the most common type of maintenance — a mistake. Besides costing more, the vehicle remains stopped for longer and, in some cases, may even be a total loss. All because proper preservation through preventive maintenance was not performed.

Corrective work involves repairs and parts replacements, always seeking to extend vehicle life.

Predictive maintenance

Less common than the others, predictive maintenance is more recent in fleet management. It is a fleet maintenance plan that uses more advanced technologies to detect problems before they happen.

One device used detects vehicle vibrations. Through it, a pattern considered normal is identified. From there, increases in vibration are detected very quickly, even before the driver notices there may be a problem.

In this case, increased vibration may indicate a suspension, calibration or alignment problem, for example. This allows corrective work to be brought forward, lowering long-term costs — since the vehicle has not actually broken down and is simply undergoing analysis and prevention.

Logistics technology

Technology is taking over fleets. Over the last 6 years, logtech companies have emerged with a wide variety of technological solutions that make fleet management easier.

Programs for financial, administrative, vehicle, tire, maintenance and refueling control, and much more. You can already find alternatives for every stage of a transport operation.

And when we talk about technology, some other related terms arise:

ERP – Enterprise Resource Planning

This management system can be used in various business models, even outside logistics. After all, as the term indicates, these are planners of company resources.

Today there are already solutions specifically for fleets that also include tire control and vehicle maintenance features. Something more generalized solutions for all types of business do not have.

API – Application Programming Interface

This term, also from English, stands for “Application Programming Interface.” It sounds a little strange, but is actually quite simple:

It is a type of application programmed to integrate the platforms a company uses.

This way, if a company has an ERP and a separate tire management system, for example, it can use the API to combine information from both tools — without the rework of transferring data from one to the other.

SaaS – Software as a Service

With so many technologies emerging, installing new systems on the company's computer or phone can become burdensome. That is why what are called “software as a service” solutions began to be developed as an alternative.

In other words, systems that can be used without installation on hardware or updates to it.

If you look at this year's fleet management trends, you will certainly find someone talking about cloud services — through which SaaS can also operate.

Dashboard

The dashboard, or control panel, is the central view each system presents. It contains the main data managed by the system.

So a maintenance management system shows the number of active vehicles in the fleet, as well as how many are undergoing corrective work and how many have overdue inspections.

Some dashboards also show charts and general fleet analyses, such as the item with the most open work orders or the vehicle with the most problems in the last 6 months.

Routing

Routing simply means creating routes for a fleet vehicle. That is, defining the paths used.

Although it is common to think the best and most economical route is the shortest, this is not 100% true. In reality, traffic lights, traffic, vehicle departure time and curves, among other factors, must be considered to understand whether the route is actually faster and uses less fuel.

For more effective routing, specific technologies exist. Some even use artificial intelligence and learn as they are used, analyzing and comparing routes and offering better alternatives with each trip.

This brings us to another fleet management concept:

Route optimization

Optimization is part of routing and simply means improving the routes used by the operation. Besides considering roads that reduce delivery operation time, optimization systems also consider the stops needed.

This makes the service more strategic and efficient, generating both savings for the company and satisfaction for customers — who, when deliveries are to end consumers, receive their goods in the shortest possible time.

Tracking and monitoring

Tracking means keeping track of vehicles and cargo along their routes. Monitoring is more complete:

Besides providing a real-time view of operational progress, it also supplies information on driver behavior, stop durations and idling.

If you want to collect and analyze data on acceleration, braking, average speed, fuel consumed and so on, monitoring systems are the best alternative.

Telemetry

In this context, there is telemetry: a distance-measuring technology that also produces information on RPM, speed and engine temperature, among other things.

Used in many monitoring systems, it is one of the most complete ways to keep track of data about your fleet's trips.

Working hours management

Applicable to all workers, working hours management is a process for recording each company employee's start, break and finish times.

In fleets, this control is often discussed for drivers, since their schedules differ somewhat from those of people responsible for administrative tasks, for example.

To prevent working hours from being exceeded and ensure drivers rest appropriately for safer trips, Brazil enacted Law 13.103 (in Portuguese). Also known as:

Brazil's Driver Law

In Brazil, this law determines professional drivers' rights and duties, such as:

• How many hours per day a driver can drive;
• How much lunch break time they should have;
• How many consecutive hours of sleep they need per day/night;
• Etc.

In addition, the Brazilian law also determines some duties for fleet managers, such as the need to keep logbook and working hours records reliably and accurately.

Fuel consumption

(video in Portuguese)

Fuel consumption is calculated by dividing distance traveled by the volume of fuel used along the route. This result lets you understand and plan monthly refueling budgets more accurately.

As this is a variable (and quite high) expense, many managers have a mission to reduce fuel costs.

Especially with constant price increases for all fuels in recent years, demand for more efficient consumption control has become pressing. Today, several technological system alternatives already exist to meet this objective.

As you can see, it is an area requiring close attention in fleet management.

Fleet operating costs

Besides fuel costs, there are other types of fleet expenses. When we talk about “operating costs” within a transport operation, this means amounts allocated to:

• Vehicle and tire maintenance;
• Vehicle insurance and legal compliance;
• Driver training;
• Purchases of parts, tires and fleet products;
• Among others.

Basically, any budget allocated to keeping the operation running can be considered an operating cost.

Driving style

How the driver drives — this sums up “driving style.” Whether they drive defensively and economically or in a way that wastes fuel, harms vehicles and reduces tire useful life.

For example, an action that both increases fuel consumption and tire wear is waiting to brake right at a red light instead of taking a foot off the accelerator a few meters away.

Fleet efficiency and productivity

Both concepts go together. The difference is that efficiency relates more to failure-free operation, while productivity is understood as results obtained over a given period.

These results may concern the time used to complete a fleet task, delivery time on a route, or cargo loading and unloading time.

In addition, productivity includes actions not strictly related to time, such as the amount of cargo that can be sent in each vehicle and the mileage covered by drivers — but these are only some examples.

Risk management

A set of fleet management strategies and actions to predict and prevent risks associated with transport operations. Risks include cargo theft, traffic accidents, vehicle breakdowns and tire blowouts.

To prevent these threats, you first need to know them and how to act in each case. This also lets you recognize the best precautionary measures.

Want a clearer picture?

Cargo theft can be prevented using routing systems and the manager's and driver's knowledge of the safest times to travel on a given route.

Vehicle breakdowns are reduced by carrying out the fleet's preventive maintenance routine, which identifies problems early.

CPK – for vehicles and tires

The acronym CPK represents “Cost per Kilometer” and can refer to the cost of travel for either vehicles or tires.

The CPK calculation considers all costs involved in making a trip happen and total mileage covered. For the vehicle, all fixed and variable operating costs are considered, and this amount is divided by the vehicle's total recorded mileage.

For tires, the purchase and refurbishment costs, when applicable, are divided by total mileage covered — you can see this calculation in more detail here.

CPK is also considered one of the fleet's performance indicators. Take a look:

Fleet performance indicators – KPIs

To understand how your fleet management is performing, KPIs — key performance indicators, or performance indicators — are used. Through them, managers establish performance standards and determine realistic goals for the company to achieve.

Maintenance costs, for example, can be measured through how many times the same item has caused problems in a single vehicle and the frequency of corrective maintenance per driver.

It is up to the fleet manager to determine what to analyze, what the objective is and which metrics are best for reaching the desired result.

In another context, if the plan is to reduce fines, you first need to understand the most common infractions, who is responsible for them, the average fine amount per driver, etc.

This way, you can determine how to raise drivers' awareness and the best approaches — training, talks, tests or a driving refresher course.

This is just an example, and the information may vary according to the purpose of the system you use. To learn more about logistics technologies and how they work, you can download our material for free (in Portuguese).