August 18, 2008
In two decades of chronicling the history of fleet management, I have seen interest in fleet safety ebb and flow. In an annual survey I conduct of fleet managers, they rated fleet safety as their No. 2 concern, right behind the cost of fuel. Why the renewed interest in fleet safety? More and more fleet managers are reporting an uptick in preventable accidents. In addition, fleet managers are feeling pressure from other corporate departments to increase fleet driver safety.
Posted @ Monday, August 18, 2008 12:57 PM | »
August 14, 2008
The high cost of materials has caused price increases for truck bodies, trailers, van interiors, liftgates, and other upfit equipment. Prices have increased, on average, 3-8 percent. Upfitting prices have risen multiple times and some truck equipment manufacturers are guaranteeing current prices for only 90 days. Worldwide, prices have soared for commodities used in upfitting, such as steel and aluminum.
Posted @ Thursday, August 14, 2008 1:44 PM | »
August 12, 2008
Fleets are adopting compensatory strategies to offset high fuel costs. These include selector modification, revised vehicle specs, increased personal use charges, streamlined fleet operations, and modification of driver behavior.
Posted @ Tuesday, August 12, 2008 10:19 AM | »
August 7, 2008
The past two weeks have produced a dizzying string of announcements ranging from Chrysler Financial stopping lease financing, Chase Auto Finance no longer providing lease financing for Chrysler brands, Wells Fargo ending lease financing, all major OEMs decreasing truck production volumes, and HSBC Financial Corp.’s decision to stop funding auto loans. All of which may be good news for fleets remarketing vehicles two to three years from now.
Posted @ Thursday, August 7, 2008 8:46 AM | »
August 5, 2008
The best time to control cost is before it occurs and the way to do this is by establishing policies and procedures that inhibit unnecessary spending and protect corporate assets. Adherence to fleet policy is crucial and it should be part of each company’s overall business strategy. The best managed fleets tend to be those whose drivers adhere to a written fleet policy. Does your corporate culture encourage compliance with fleet policy?
Posted @ Tuesday, August 5, 2008 8:41 AM | »
July 31, 2008
In Tuesday’s blog, I likened predicting the future to a billiard game to illustrate that seemingly unrelated events can influence the future direction of the fleet market – events we may never see coming. With this in mind, let’s rack up our hypothetical balls, placing the “fleet ball” in the center of the rack. Let’s whack the cue ball to see what new fleet scenario may unfold from this catalyst. In this new analogy, the cue ball catalyst is a relatively recent concept called hyperconnectivity.
Posted @ Thursday, July 31, 2008 4:00 PM | »
July 28, 2008
Predicting the future has been likened to a billiard game. The cue ball is the catalyst – representing a seminal event – that upon crashing into a racked set of balls triggers not only the initial reaction, but numerous unanticipated secondary and tertiary reactions. When the cue ball strikes its target, it unleashes unanticipated dynamics of balls deflecting off other careening balls, ultimately changing all of their trajectories. Let’s expand the analogy by making “fleet” one of the balls.
Posted @ Monday, July 28, 2008 11:21 AM | »
July 25, 2008
The greatest catalyst for change in fleet management in the next 10 years will be "technology." It is getting increasingly expensive to operate a fleet. There are diminishing opportunities to reduce cost and enhance fleet efficiency using traditional fleet management techniques. A growing number of companies are investigating (or are more receptive) to technology-based fleet solutions. Looking ahead, here are my predictions as to how technology will change fleet management in the next 10 years.
Posted @ Friday, July 25, 2008 9:24 AM | »
July 21, 2008
The high cost of raw materials, in addition to the high cost of fuel, is starting to make a financial impact on fleets by increasing costs for truck chassis, bodies, trailers, liftgates, and other upfit equipment. On July 9, Navistar announced that rising commodity costs have forced the company to increase prices of International truck models. Is this another in a series of commodity-related price increases that we will see from other OEMs, upfitters, and trailer manufacturers?
Posted @ Monday, July 21, 2008 12:28 PM | »
July 18, 2008
Today's new-vehicle market will generate (ultimately) the used-vehicle market of tomorrow. If there is a decrease in new-vehicle sales, there will be a corresponding decrease in the future number of used vehicles in the marketplace. Even though there is a lot of nervousness in the market, no one is anticipating a dramatic decrease in new-vehicle commercial fleet orders for the 2009 model-year. However, the same cannot be said for the retail new-vehicle market.
Posted @ Friday, July 18, 2008 9:01 AM | »
July 15, 2008
A combination of market forces have converged to create a “perfect storm” to drive down resale values for pickup trucks by 15-25 percent. These convergent forces are higher fuel prices, tighter consumer credit, and a stagnant construction market. As a result, the pool of buyers (hence market demand) for used trucks has contracted, putting downward pressure on resale prices.
Posted @ Tuesday, July 15, 2008 8:56 AM | »
July 11, 2008
Although fleet is extremely important to automakers, the reality is that retail sales and retail considerations drive many OEM decisions. Currently, retail buyers are demanding four-cylinder engines in what appears to be a knee-jerk reaction to paying, on average, $4.03 per gallon for gasoline. Franchise dealers just don’t have enough four-cylinders in inventory to meet this demand and they are clamoring for more product.
Posted @ Friday, July 11, 2008 8:19 AM | »
July 7, 2008
I believe “location privacy” has a strong potential to become a hot-button societal issue in the next decade. It will focus on privacy infringement and potential abuse due to the pervasiveness of GPS-based products and services. These long-term implications frighten many privacy advocates. Unfortunately, I believe fleet management will be swept up into this controversy.
Posted @ Monday, July 7, 2008 4:07 PM | »
July 3, 2008
On average, 20 percent of fleet vehicles are involved in accidents each year. Although this percentage has remained steady from 2005-2007, the cost of repairing these vehicles is rising.
Posted @ Thursday, July 3, 2008 3:50 PM | »
June 30, 2008
There is a growing belief among fleet managers that today’s high fuel prices are not a temporary phenomenon, but a new reality. Almost everyone is looking for ways to downsize vehicles (where possible) or opt to four-cylinder engines as part of either a corporate sustainability initiative or fuel spend / GHG reduction program.
Posted @ Monday, June 30, 2008 4:03 PM | »
June 10, 2008
It is these procedures and regulations that determine the types of fleet each of us operates and its characteristics. Think about it. By creating policy such as to who is eligible for a company vehicle, you are, in effect, determining the size of your fleet. In my discussions with fleet management companies over the years, they tell me that the best managed fleets tend to be those that adhere to a written fleet policy.
Posted @ Tuesday, June 10, 2008 4:13 PM | »
May 30, 2008
In the late 1930s and early 1940s, businesses started to migrate from salesmen reimbursement to company-owned fleets. Since then, 10 milestones have dramatically changed the nature of fleet.
Posted @ Friday, May 30, 2008 4:05 PM | »
May 23, 2008
The U.S. Department of Transportation is expected to release its revised medium-truck tire standard (FMVSS No. 119) during the second half of the year. However, it is anticipated that it won’t contain a provision calling for the use of a Tire Pressure Monitoring System (TPMS) for Class 3-8 commercial trucks. TPMS is an electronic system that monitors the air pressure inside pneumatic tires. Should TPMS be mandated for commercial trucks over 10,000 lbs.? Here are three reasons supporting this.
Posted @ Friday, May 23, 2008 1:24 PM | »
May 19, 2008
After 8,000 hours of research, more than 11,000 facts pertinent to the fleet industry have been collected for this year’s Automotive Fleet Fact Book. Within this wealth of data, one overriding fact stands out with klieg-light intensity – the impact of the high cost of fuel.
Posted @ Monday, May 19, 2008 4:35 PM | »
May 2, 2008
Complacency. It is defined as self-satisfaction, especially when accompanied by unawareness of actual dangers or deficiencies. Is this you? Complacency is a real danger to fleet operations, especially well-run fleets.
Posted @ Friday, May 2, 2008 1:32 PM | »
April 21, 2008
An average end-of-service fleet sedan is three years old with 60,000-plus miles. The resale market for these used vehicles encompasses diverse demographics. However, in most cases, the dealers who buy fleet vehicles at auction will ultimately resell them to someone of limited financial means. In many cases, these buyers have less than stellar credit and may only qualify for a subprime auto loan. Since the onset of the subprime crisis, loan approvals for these customers are more difficult.
Posted @ Monday, April 21, 2008 10:09 AM | »
April 14, 2008
For the first time ever, the price of diesel in many regions of the country exceeds $4 a gallon. Since Jan. 1, diesel prices have risen more than 19 percent. The American Trucking Associations (ATA) predicts that truck fleets will spend more than $135 billion on fuel in 2008. This compares to $112 billion in 2007.
Posted @ Monday, April 14, 2008 9:32 AM | »
April 7, 2008
The key reason for the increase was the cost of fuel, in particular, diesel fuel. This has also led to price increases for other oil-based products such as tires, which increased 4-7 percent in the past year. Other PM costs remained flat.
Posted @ Monday, April 7, 2008 11:07 AM | »
April 1, 2008
When resale prices soften, there is a pendulum-like resurgence in marketing used vehicles to employees. On the other hand, when the resale market is strong, fleets are complacent about employee sales (waiting for buyers come to them) and do not aggressively market the program to new buyers. The national average of vehicles sold to employees is 23 percent. However, by aggressively marketing employee sales, many fleets could sell as much as 50 percent of their vehicles in-house.
Posted @ Tuesday, April 1, 2008 10:41 AM | »
March 17, 2008
Score one for our side! Recently, a Fortune 100 company gave (very) serious consideration to eliminating its company-provided vehicle fleet program and switching to driver reimbursement. Initially driving this initiative was senior management’s desire to cut cost by removing the vehicle assets from the books. The option to move to an operating lease was not viable since it violated the company’s accounting policies set by finance.
Posted @ Monday, March 17, 2008 10:16 AM | »