May 2009, Automotive Fleet - Cover Story
Bright Ideas Energize Fleet Management
From acquisition to remarketing, a compilation of best ideas in managing successful, cost-effective, and efficient fleets is presented.
By Cindy Brauer & Thi Dao
For a full PDF of this article, click here.
Where else but on the front line of fleet management are found the brightest ideas in cost-effectively and efficiently managing the often-critical corporate assets of company vehicles? Gathered in this article are some of the best practices fleet professionals and experts have shared with Automotive Fleet.
Many good solutions can be applied overall to commercial fleet management. However, others may need refining to fit an individual fleet’s specific operations and its company’s corporate culture, business style, and organization.
VEHICLE ACQUISITION
◗ Closely match vehicle to function, geography, and employee classification.
◗ Be well informed and prepared before meeting with manufacturer reps. Supply actual data, rather than guessing or providing misleading information.
◗ Establish a bailment pool in truck fleets that have moderate to major upfitting to shorten downtime caused by longer or uncertain order-to-delivery time.
◗ Track vehicle mileage and condition carefully to aid in replacement scheduling.
◗ To avoid out-of-stock purchases, use long-term rentals or pool cars to accommodate drivers who need a vehicle outside replacement ordering.
DEPRECIATION MANAGEMENT
◗ Utilize total lifecyle management to accurately depreciate vehicles, turning them in at peak of lifecycle for resale.
◗ Depreciate each vehicle individually, using an internal system that groups fleet vehicles according to mileage categories. With monthly reports and by monitoring individual driver mileage, determine which vehicles are out of sequence and adjust lease terms mid-lifecycle.
◗ Implement driver-targeted programs to promote good vehicle maintenance.
REMARKETING
◗ Remarket in a timely manner, even before a vehicle comes out of service, use the right multiple venues in which to remarket, have the vehicles in presentable, reconditioned shape, and always tell the accurate story about a vehicle’s history and condition.
◗ Monitor vehicle cost cycles and dispose of vehicles just prior to a cost cycle spike.
◗ Develop and implement an employee sales program. Create an easy-to-use online program to facilitate sales, with adjunct services such as financing or transport when possible. Price vehicles at an attractive level, between wholesale and fair market value. Promote the program vigorously through as many communications venues as possible — internal channels, e-mails, brochures/posters in offices throughout the company, links on Intranet, or closed-circuit TV announcements. Most fleet management and leasing companies have customizable employee sales programs.
◗ Continuously monitor market/remarketing trends for optimum fleet vehicle disposal. Review historical auction data to determine the key point to sell a particular vehicle model.
◗ In a truck fleet, track vehicle utilization, based on time and mileage, and suggest shifting trucks between drivers to maximize life expectancies.
◗ Align with a remarketing group that examines all factors, including photos, condition reports, and the best remarketing venue.