ZF takes Fleet Management to the next level with Orchestration

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Interview with Hjalmar Van Raemdonck, Head of Digital Systems Solutions.

Andreas Neemann,

Andreas Neemann wrote his first ZF text in 2001 about 6HP transmissions. Since then, the automotive writer has filled many publications for internal and external readers, showcasing his passion for the Group's more complex subjects.

Since the acquisition of WABCO, ZF has become one of the most important suppliers of fleet management systems. Hjalmar Van Raemdonck, Head of Digital Systems Solutions & Managing Director of Transics, explains which factors will be crucial for success in the future.

Transics, a fleet management system from WABCO – now ZF – has been on the market for 30 years. Can you sum up where you stand with the service, and what’s next?

With our Transics solution, we are currently one of the largest independent providers of fleet management solutions in Europe. We are top in Europe with premium fleets and we have proven as an innovative player in the market for our customers and partners. Moreover, with the acquisition of Bestmile technology last fall, we are ideally positioned to leverage the potential that digital solutions have for our customers, in freight logistics as well as in passenger mobility, both today and in the future. Our goal is to bring connectivity on a new level in order to create better services and to make people mobility and freight logistics more efficient. We see that in the future fleets will be getting more mixed, so fleet operators need innovations to master this challenge.

Hjalmar van Raemdonck

How do you plan to achieve this?

ZF strongly believes in digital solutions. But we also believe in differentiation. So our approach is orchestration. Firstly, today, it's not about “just” having data – as one of the biggest Tier 1 suppliers, we already have access to a lot of unique vehicle data. It’s about what you do with it. It's about organizing this data in such a way that insights can be derived from it, be it for better route planning or better dispatching. For this reason, we need – secondly - to change our platform approach: we need software enriched with artificial intelligence. The transformation of data into valuable insights has to be as automated and in real-time as possible. So we thirdly have to infuse machine learning and AI in order to create a system that can manage mixed fleets and real-life complexities in a matter of seconds. Sofrom a cost perspective and in order to make better use of the potential that is still untapped today, the next phase of fleet management systems will be fleet orchestration systems.

"Our goal is to bring connectivity on a new level to create better services and make people mobility and freight logistics more efficient."

Hjalmar van Raemdonck

What specific problems can orchestration and artificial intelligence solve?

In the freight sector, there are still far too many empty runs – the rate is around 25 percent. So efficiency is still far from optimal. And it’s even getting more complicated: Imagine we have a mixed fleet of EV trucks, autonomous vans and human driven trucks. The situation is very similar in people mobility. Here, there is also great potential for efficiency, especially in cities, if autonomous transportation systems flexibly take passengers from A to B around the clock as and when required. And again: Imagine a mixed fleet of EV Cars, Robotaxis, human driven cars. You need a system that can handle complex assets and complex situations. It’s all about sending the right mission to the right driver to the right vehicle, carrying the right cargo or transporting the right people in the right moment. And this not only for one driver, vehicle, passenger, cargo unit, but for thousands.

Orchestration platforms enable automatic, real-time decision-making for planning, routing and dispatching of mixed vehicle fleets. This ensures that the right vehicle and driver (or driverless vehicle) are sent at the right time and to the right place.

For such an orchestration, however, you need a completely different technological backend than for previous fleet management systems ...

To achieve orchestration, we had to totally rethink our platform approach. We built from ground up a completely new platform that is , modular, micro-service-based and hyperscalable. This platform which we call Fleet Orchestration Platform is dynamic and equiped with machine learning and AI. On top, last year we acquired Bestmile technology to enrich this platform with their world class optimization algorithms and their powerful digital services like planning, routing, forecasting for autonomous vehicles. We will use it to bridge the digital silos that still prevail today.

What exactly do you mean by that?

Let’s have a look at freight logistics as an example: The digital transformation of the industry has started, but we still work in silos. Shippers, logistics providers, long haul carriers, distribution centers, short haul carriers – they all have their digital stand-alone solutions. But the end customer in particular expects a holistic solution across the entire supply chain.They want to know what their cargo is up to at any time.

What is the reason for this “siloing”, and how do you intend to change it?

There are limitations of the data architecture. We need our new platform approach to better integrate all services of an logistics or public transport ecosystem and to have a starting point for big data analytics. On this reason, our goal for further development is a digitally connected supply chain. It becomes clear when we look at the future of passenger transport, mobility-as-a-service solutions based on autonomous transport systems, which the ZF Group also offers. With our technology we want to break the silos between embedded software and application software. To give an example: We are now working on a project that can leverage ADAS Sensor data to create advances safety dashboards for our fleet customers.

How does decarbonization affect the industry?

It’s huge. Customers and governments are pressuring trucking companies to reduce their carbon footprint even as the transport industry is challenged with escalating demand fueled by e-commerce. Trucks make up 2% of vehicles on the road, but account for 22% of vehicle greenhouse gas emissions. And it's not just legal pressure: many large fleet operators – especially the logistics operations of major consumer brands – are committing themselves to massively lessen their environmental impact. And for passenger transport in large cities, all operators are relying on locally emission-free, electric drives anyway.

How can orchestration support reducing emissions?

In general, digitization promises greater efficiency, which also means fewer emissions. With our orchestration tool, we directly enable services that contribute to emissions savings. Better orchestration also reduces the emissions directly because fleets have to drive less thanks to better routing, planning and scheduling. A study that we conducted for the city of Chicago found out that just by orchestration we could reduce carbon emissions by 30%.

Is decarbonization also a personal topic for you?

Yes, absolutely. Privately, I won the World Solar Challenge with Nuna4 in Australia. There, you quickly realize how many factors have to come together to be successful - aerodynamics play an important role, but the optimization algorithm to define when an how much solar energy you have to use has even a bigger influence. Now that I look back its like orchestration for a single vehicle. Based on these experiences I am committed towards ZF’s Vision Zero (Zero Emmissions and Zero Accidents) and our new orchestration platform will take our dream one step closer.