The TCO effect of ADAS versus the TCO effect of prevention programs

Based on a recent study Fleet360 carried out on the TCO effect of ADAS, we can conclude that the business case for a fleet owner isn’t yet positive. Though ADAS without dispute reduces the number, as well as the severity of accidents some components are still having a negative financial impact. We can indicate 3 major reasons which have a negative impact.

The TCO effect of ADAS

1. Consider the investment in lease cost to include ADAS features:
Full driver assistance pack+/- €2500
Depreciation cost per month+/- €35
Based on a 48 month / 30,000 km contract
Forward collision prevention+/- €800
Depreciation cost per month+/- €11
Based on a 48 month / 30,000 km contract
2. The repair cost which is substantially higher given the extra technology and more complex repair

Some repair types for parts which are equipped with these extra features have increased quite a bit.

PartsLast 10 years
Headlight+ 106%
Front bumper+ 35%
Door+ 20%
Mirror+ 106%
Windshield+ 30%

We noticed as well that more parts are replaced then repaired and that this technology requires a recalibration in order to function properly when the vehicle is put on the road again. In the last 10 years, the average repair cost increased by 17%.

RepairsLast 10 years
Average repair cost+ 17%
Product price+ 32%
Parts price+ 29%
Average labour cost+ 21%
Average repair time– 15%
3. The knowledge and behaviour of the driver

Drivers often aren’t possessing the necessary knowledge or having the right expectation of the different systems present in their vehicle, which results benefits aren’t used to the full extend or create new dangers in case of over-relying.

Taking into account both positive & negative impacts we came to a ROI of 0.35 for direct costs. If you take into account indirect costs then the ROI will be even higher and potentially even neutral.

How can ADAS become financially beneficial?

Does this mean you shouldn’t add these safety features in your vehicles? Certainly not. However, for the time being and with the current state of maturity of ADAS, the human factor still has the greatest impact on safety and accident costs. Therefore, it is still most favorable to improve driving behavior.

TCO affect of ADAS
The driver has the greatest impact on safety & accident costs

There are a few actions you can take which will help you turn prevention programs into a financial benefit:

  1. Deep dive into your damage statistics, which will create transparency in both circumstances in which most incidents happen as which drivers are provoking them
  2. When having insight on the type of incidents you can install the most appropriate ADAS features.
  3. For drivers with an increased risk, you can work out a safety program or support them in becoming a safer driver.
  4. Create attention in your processes (eg. vehicle delivery) or in your safety communication to the functionality of ADAS in order to boost the drivers knowledge
  5. ADAS features are becoming less expensive or are part of standard equipment of the vehicle. Control if some partners, like insurers, are giving support to these installations.

Next to the financial impact, the social impact is beyond any question positive. Avoiding physical injuries, human suffering due to accidents is priceless!

Further information and analysis of the TCO effect of ADAS

Fleet360, gave an expert session recently for a Link2Fleet session on TCO & driver impact of ADAS for fleet owners.  

Explore the findings:

Dutch Session

French Session

Any questions?

If your company would like assistance with making a business case for investing in ADAS systems starting from an analysis of your accident statistics, or more in general if you want to discuss the advantages and content of a bespoke safety or prevention program, please reach out to us for a chat.

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