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KPMG Toll Benchmark Study finds toll operators losing millions annually to operating inefficiencies and leakage

Toll operators losing millions in inefficiencies

New tool is a global first in measuring toll efficiency.

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Lauren Mostowyk

Head of External Communications, Global Industries

KPMG International

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In a global first, KPMG International has released the results of a new benchmarking study measuring the efficiency of today’s tolling operators. The research demonstrates where operators may be making and losing revenue dollars based on operating model, technology use and leakage. On average, the operators surveyed are losing USD $8 million per year from inefficiencies and leakage. 

Comparing 65 toll operator respondents from around the world, the benchmark makes it clear that technology is disrupting the industry and has the power to eliminate a number of operating models if organizations do not swiftly upgrade and adapt to a new way of doing business.

Says Stephen Beatty, Chairman (Non-Exec), Global Infrastructure Head, City Center of Excellence, KPMG International: “Leaders in the industry are gaining traction because they are reviewing their entire business from the ground up. They put the customer at the heart of their model and use technology to create an excellent experience that drives revenue and generates the greatest return from every dollar spent. Cutting cost isn’t the focus for these leaders – it’s about creating a world-class experience.”

The report reveals that toll operators have the opportunity to be the center of a new, quickly forming mobility platform, where tolls are collected seamlessly and efficiency is prioritized. This will involve larger interoperability agreements, which 35 percent of respondents are open to forming. But it will take more than that. Operators also need to begin the more complicated work of preparing for autonomous toll collection, the embrace of autonomous vehicles, and the use of collected data to transform the customer experience. 

KPMG has discovered that only a handful of operators (five of 65 respondents) are poised to benefit from the quickly changing landscape of tolling. Leaders in the industry demonstrate the following:

  • Regularly maintain a 90 percent margin of the total cost to collect, or 0.24 USD total cost to collect.
  • Removing cash from the system. Top operators use Open Road Tolling (ORT) and Electronic Toll Collection (ETC).
  • Are most often private companies and less hamstrung by public services infrastructure or elected officials.

The less-efficient segment of the industry showcase how growth could become a challenge in a digitally-managed world:

  • Operators with less efficiency in their model reported a total cost to collect more than twice as expensive than the top quartile of efficient operators. The expense is often driven by manual collection methods.
  • Many are relying on old technology. Only 25 percent are using systems that are one year or less old, with 39 percent using technology 5 years or older.

Concludes Beatty, “Our data suggests there is more than US$90 million that could be saved by toll operators if the lowest quarter of performers could improve operations to match the efficiency of the best-performing quarter. That’s a lot of money that could be used to improve roads and technology that improves the customer experience.”  

To learn more about the benchmark and to use the tool, please visit home.kpmg/tollstudy.

About the report

This survey was conducted by KPMG International and its member firms in 2018. In total, confidential responses were collected from 65 public and private toll operators representing a total of 184 tolling facilities worldwide. Respondents represented organizations headquartered in 15 countries across the Americas, Europe and Asia.

All cost data was collected in 2018 and was based on the most recent financial results for each toll operator. Foreign currencies were converted to US dollars using the exchange rate as of the end of September 2018.

About KPMG International

KPMG is a global network of professional services firms providing Audit, Tax and Advisory services. We operate in 153 countries and territories and have 207,000 people working in member firms around the world. The independent member firms of the KPMG network are affiliated with KPMG International Cooperative ("KPMG International"), a Swiss entity. Each KPMG firm is a legally distinct and separate entity and describes itself as such.

For further information please contact:

Lauren Mostowyk
KPMG Corporate Communications
T: 416-377-3155 
E: lmostowyk@kpmg.ca

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