Zonar Systems received $50 million from Daimler Trucks to make connected services for truck fleets.
Zonar Systems, a Seattle company that provides tracking technology for truck fleets, has received a $50 million investment from Daimler Trucks North America to ramp up its hardware and software offerings for large vehicles.
Zonar, which has its office in South Seattle near Tukwila, has worked with Daimler to provide telematic services for about five years. Daimler Trucks, based in Portland, will become a minority stakeholder in Zonar, though the company did not disclose what percentage ownership Daimler is taking.
Zonar is targeting a huge market. The U.S. trucking industry reached more than $700 billion in revenue in 2014 and employed more than 7 million people, according to the American Trucking Associations.
In the next five years, researchers expect 75 percent of new cars to be built with connected hardware that allows drivers to monitor fuel, access maps and make phone calls, among other services, according to Business Insider Intelligence.
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The Puget Sound region is home to many connected car companies, including INRIX and Airbiquity, but they generally focus on the consumer car market. INRIX, for example, received $55 million from Porsche in September to continue monitoring traffic patterns and help build cars with Internet-enabled services.
Zonar, which has annual revenue of about $100 million, doesn’t have any plans to jump into the luxury-car market. The company is staying true to its roots in commercial vehicles and managing technology for large fleets.
Zonar also announced it is opening a developer office in downtown Seattle in August. The company wants the Seattle address to help recruit hardware and software developers, Zonar CEO and co-founder Brett Brinton said.
Zonar’s 70 developers will move into the new location in August, and the business is looking to hire about 50 more. Zonar plans to have 300 employees by the end of the year, Brinton said.
Most of the movement in the connected-car arena is taking place in the commercial part of the market, said John Niles, president of Seattle consulting company Global Telematics.
“Trucking companies are paying their drivers, and they want to be able to supervise what’s going on,” he said. “They need to make sure drivers are taking the best routes and not violating the law.”
Zonar believes its systems can make drivers more efficient in how they use their time and make driving huge commercial vehicles safer. Its technology monitors truck maintenance and the activity of the drivers.
The technology maintains a “Virtual Technician” in a black box inside each vehicle that gathers data of the driving time before and after a “check engine” light, or something similar, is activated in the truck. The technology can assess exactly what repair is needed and locate the nearest auto shop.
That can save the driver time, while the operating company saves money. Zonar also develops technologies to monitor gas usage.
Daimler’s $50 million investment means Zonar will continue to develop products for the company and have greater access to Daimler’s engineers, but it does not lock Zonar into an exclusivity agreement with the trucking company.
“We will continue to make our own products that sell to all fleets,” Brinton said. “Whether that’s construction or utility or a school district.”