The arrival of connected cars and 'big data' promise to revolutionise the fleet industry, according to predictions at ACFO's spring seminar. The event, titled 'Big Data, Big Seminar' was sponsored by AIG, Audi and Lex Autolease, the largest vehicle leasing and fleet management business in the UK. The event took place at Whittlebury Hall, Northamptonshire, involving around 80 fleet decision-makers. Subjects under discussion included the transformation of contract hire companies into businesses that lease vehicles, cars as 'mobile devices' as well as issues around data protection and privacy.
Nick Mitchell, service and technical manager at Audi, said: 'The arrival of the connected car will result in massive changes in the way people use cars and the application and provision of cars. Technology will be updated before our eyes. It is a massive revolution that we are about to go through and the pace of change will never be as slow again.'
Craig McNaughton, corporate director at Lex Autolease, echoed the sentiment that 'big data' means 'transformational change', predicting that fleet managers will be able to 'predict the futureî of maintenance and repair requirements by analysing driver behaviour data, removing some uncertainty from fleet operation. Lex Autolease's piloting and eventual roll-out of operational benchmarking in areas from vehicle expenditure to risk management provides a sign of things to come, as it enables fleets to make improvements and cut costs. 'Connected car data will fundamentally change our industry' McNaughton told attending delegates. 'We have a long way to go, but we must change from a rear-view mirror perspective to using data to predict the future and move from a leasing company that provides management information to a data company that leases vehicles.'
However, various concerns relating to the big data revolution were raised for discussion as policy makers, as well as manufacturer and leasing company representatives, must shift strategy in order to meet the challenges of data ownership and accessibility. Some key issues include determining liability around data breaches and manufacturer definitions of 'the customer', whether the customer is considered to be the contract hire and leasing company, end-user fleet or company car driver, for instance.
Audi's Nick Mitchell went on to forecast that cars would transform from 'status symbols' into 'mobile devices' evidenced by Apple, Dyson and Tesla bringing fresh competition to the motor manufacturing industry. He suggested that the invention of the connected car will provide motorists with the ability to download extra functionality and post-release updates, altering a model's physical features and specifications at the touch of a button. An example was made of a company car which, although sold as a 150bhp model, could later be upgraded to add an extra 20bhp on demand. This would change the model's performance, as well as its related CO2 emissions, and therefore the associated benefit-in-kind tax bill. This is likely to create a huge impact on fleet operations as well as tax and legislation requirements. 'Drivers will want that functionality' Mitchell said. 'But the car will no longer be the vehicle that it was. That would have a massive impact on HM Revenue and Customs' revenue. Legislation and the tax system as we know it will have to change and that will have to be dealt with.'
Alex Ktorides, head of ethics and risk and partner at law firm Gordon Dadds, warned delegates of the need to take action to protect themselves in the new era of 'big data' by updating contracts, terms and conditions and codes of conduct. ''Big data' is all about having an ethical approach and that means transparency' Ktorides said. 'Connected cars will generate huge amounts of data and the question is what happens to that data. It is crucial to make sure it is being ethically handled.'
The anticipated introduction of General Data Protection Regulation on May 25th 2018 promises to impact fleet management of connected cars in particular, building on existing data protection legislation to meet modern day technological and digital challenges. Core to the new laws will be a revision of the eight 'principles' of data protection to ensure greater transparency, accountability, and crucially, proof of consent regarding gathering of data. 'Businesses must be clear about what data they are gathering and why, where it is going and how it is being used and gain people's consent' Ktorides added.
'If information is personal and identifies who a person is and how that employee is using their car and their behaviour then it impacts on their privacy and requires sign-off. 'There is huge value in gathering data, but that must be balanced against people having a right to privacy. Employers must put people's rights at the forefront and show good governance and gain consent.'
John Pryor, ACFO chairman, told delegates of the need to manage the increasing pace of change while facing other difficult issues such as questions around the viability of diesel vehicles, the consequences of Brexit, increases in fleet administration requirements as well as recent Government consultations on business expenses. The recent scandal resulting from the hacking of NHS computer systems has been a reminder of the importance of data security and collection in future connect vehicles, Pryor suggested. He concluded: 'Today's connectivity is the start of the journey towards the autonomous car and while the secure exchange of data builds the foundations for new business activities and applications, there are significant risks and challenges regarding safety, security and privacy that need to be addressed.'