The fleet industry stands at a crossroads, with electrification emerging as a viable path for businesses aiming to cut emissions and operational costs. Yet, the pace and direction of this transition remain uncertain, shaped by evolving expectations and regulatory landscapes. While momentum builds around replacing combustion engines with electric vehicles (EVs), the shift encompasses far more than engine swaps. As fleets navigate this complex terrain, one truth becomes clear: data, harnessed through advanced telematics, will be pivotal in guiding strategic decisions and shaping the future of fleet management.
Historically, telematics has empowered fleet operators to streamline operations by providing insights into routing, fuel usage, maintenance, and driver behavior. As the industry embraces electrification, telematics capabilities are expanding to offer a more nuanced view of energy consumption, vehicle deployment, charging logistics, and their implications for operational costs and efficiency. In this new paradigm, data is becoming the new diesel, a critical resource for fleet management.
EV adoption has seen significant progress, but recent trends indicate a slowdown. Battery electric vehicles (BEVs) accounted for 8.9% of U.S. light-duty vehicle sales in Q3 2024, but this share dipped to 7.5% in Q1 2025, signaling a plateau in consumer uptake despite year-over-year gains. Economic pressures and regulatory uncertainty have contributed to this slowdown, along with challenges in accessing EV incentives, infrastructure readiness, and unpredictable residual values. However, EVs have proven cost-effective in specific applications, such as urban delivery fleets and predictable regional routes, offering lower total cost of ownership and measurable ROI.
Despite the slowdown, fleet operators cannot afford to delay transition planning. Even if full EV adoption is years away, having a well-thought-out transition plan is crucial. This is where data and telematics become indispensable. Fleet operators must begin treating electricity as a managed resource, adopting new strategies for energy usage. Telematics data from traditional fleet vehicles can serve as a baseline for identifying optimal EV replacements, while telematic systems in EVs can track energy usage in real-time, match EV capability to route planning, and predict future energy needs.
Telematics platforms, traditionally focused on managing diesel or gasoline vehicles, are now being enhanced to track electricity consumption, charging behavior, and vehicle deployment strategies. This comprehensive approach enables fleet operators to optimize energy consumption and vehicle performance, critical areas for effective fleet management and cost control. By integrating energy usage data with operational data, telematics can provide insights that help balance energy demand and vehicle deployment, reducing operational costs in the long run.
However, challenges remain. The lack of interoperability across different telematics, fleet management, and EV-charging platforms can hinder data-driven decision-making. Despite these hurdles, the long-term benefits of transitioning to electric fleets are undeniable. As fleet managers explore ways to optimize operations, data-driven solutions will be integral to their success.
For fleet managers, the time to act is now. Gathering data, analyzing energy consumption patterns, and exploring evolving tools will be key to managing the transition to electrification. By understanding the capabilities of telematics today and preparing for future advancements, fleet managers can make informed decisions that pave the way for a successful transition, regardless of the timeline.
As Lisa Drake, Director of Fleet Electrification at Merchants Fleet, notes, the evolution of telematics and data-driven tools supporting fleet electrification will ensure that fleet operators are prepared for a more sustainable, cost-efficient future. Merchants Fleet is actively monitoring these trends and supporting fleet operators through this pivotal transition. The journey to full electrification may be long, but with the right tools and strategies, fleet operators can navigate the challenges ahead and emerge stronger.