Market Trends

More Factors Point to an Impending Used-Vehicle Shortage

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.

Tags: Remarketing, Chrysler

Author: Mike Antich | Posted @ Thursday, August 7, 2008 8:46 AM | » Comments(3)

How to Develop a Corporate Culture of Fleet Policy Compliance

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?

Tags: fleet policies, Compliance

Author: Mike Antich | Posted @ Tuesday, August 5, 2008 8:41 AM | » Comments(1)

Will You Need Fewer Fleet Vehicles in an Era of Hyperconnectivity?

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.

Tags: Web tools, hyperconnectivity

Author: Mike Antich | Posted @ Thursday, July 31, 2008 4:00 PM | » Comments(3)

Is the U.S. Destined to Follow the U.K. Fleet Model?

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.

Tags: Taxes, budget deficit

Author: Mike Antich | Posted @ Monday, July 28, 2008 11:21 AM | » Comments(2)

Fleet Management Circa 2018

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.

Tags: Fleet Management

Author: Mike Antich | Posted @ Friday, July 25, 2008 9:24 AM | » Comments(2)

Rising Commodity Prices Threaten to Increase Truck Prices

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?

Author: Mike Antich | Posted @ Monday, July 21, 2008 12:28 PM | » Comments(1)

Bleak New-Vehicle Sales to Usher a Strong Used-Vehicle Market

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.

Tags: 2009-MY, new vehicle sales

Author: Mike Antich | Posted @ Friday, July 18, 2008 9:01 AM | » Comments(2)

A Perfect Storm Pummels Truck Resale Values

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.

Tags: Remarketing, Resale Value, Four-Cylinder

Author: Mike Antich | Posted @ Tuesday, July 15, 2008 8:56 AM | » Comments(0)

Will High Demand for 4-Cylinder Engines Increase OTD?

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.

Tags: Order-to-Delivery Times

Author: Mike Antich | Posted @ Friday, July 11, 2008 8:19 AM | » Comments(0)

'Location Privacy' Threatens to Emerge as a Major Fleet Issue

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.

Author: Mike Antich | Posted @ Monday, July 7, 2008 4:07 PM | » Comments(1)

Accident Management Costs Trend Upward

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.

Tags: Accident Management, Cost-cutting

Author: Mike Antich | Posted @ Thursday, July 3, 2008 3:50 PM | » Comments(0)

Increased Fleet Demand for 4-Cylinder Engines

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.

Tags: green initiatives, Downsizing

Author: Mike Antich | Posted @ Monday, June 30, 2008 4:03 PM | » Comments(0)

The Dangers of Policy Exceptions

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.

Tags: Fleet Management, fleet policies

Author: Mike Antich | Posted @ Tuesday, June 10, 2008 4:13 PM | » Comments(0)

10 Milestones That Changed Fleet Management

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.

Tags: Fleet Management, Fleet Incentives

Author: Mike Antich | Posted @ Friday, May 30, 2008 4:05 PM | » Comments(3)

Pros & Cons of TPMS for Class 3-8 Truck Tires

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.

Tags: Fuel Savings, TPMS, Tires

Author: Mike Antich | Posted @ Friday, May 23, 2008 1:24 PM | » Comments(3)

High Fuel Costs Take Fleet into Uncharted Water

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.

Author: Mike Antich | Posted @ Monday, May 19, 2008 4:35 PM | » Comments(-6)

Avoid the Complacency of Running a Well-Managed Fleet

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.

Tags: Fleet Management, Fleet Manager

Author: Mike Antich | Posted @ Friday, May 2, 2008 1:32 PM | » Comments(0)

Subprime Crisis Metastasizes to Fleet Resale Market

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.

Tags: Used Vehicle Sales

Author: Mike Antich | Posted @ Monday, April 21, 2008 10:09 AM | » Comments(0)

Reduce Fuel Spend by Modifying Truck Specs

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.

Author: Mike Antich | Posted @ Monday, April 14, 2008 9:32 AM | » Comments(1)

Medium-Duty Truck Operating Costs Increase (Again)

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.

Tags: Operating Costs, Medium-Duty Trucks

Author: Mike Antich | Posted @ Monday, April 7, 2008 11:07 AM | » Comments(0)

Think Like a Used-Car Sales Manager

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.

Tags: Resale Value, Wholesale Market

Author: Mike Antich | Posted @ Tuesday, April 1, 2008 10:41 AM | » Comments(2)

Loss of Control is Reimbursement’s Fatal Flaw

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.

Tags: Reimbursement

Author: Mike Antich | Posted @ Monday, March 17, 2008 10:16 AM | » Comments(0)

Economic Stimulus Act of 2008 Brings Back Additional 50% First-Year Bonus Depreciation

March 10, 2008

On Feb. 20, 2008, President Bush signed into law HR 5140, the Economic Stimulus Act of 2008, which, among other things, includes an additional first-year depreciation deduction equal to 50 percent of the adjusted basis of a new vehicle. This temporary change to the federal tax code requires that all vehicles and other fixed assets be purchased and put into use by Dec. 31, 2008.

Author: Mike Antich | Posted @ Monday, March 10, 2008 12:28 PM | » Comments(1)

Managing the Uncontrollable

February 25, 2008

The country’s best managed fleets are exemplified by the Top 300 commercial fleets. Operating a fleet of 1,000 vehicles or more is an expensive proposition and, with most companies, it represents the second-highest corporate expenditure after payroll.

Tags: Top Fleets, Fleet Manager

Author: Mike Antich | Posted @ Monday, February 25, 2008 11:21 AM | » Comments(0)

Tire & PM Costs Increase Car Maintenance

February 19, 2008

Increased cost of replacement tires and PM caused car maintenance expenses in 2007 to increase slightly higher than the prior year. Tire costs were up 4-7 percent, while PM expenses increased 10 percent. Other costs remained flat.

Tags: maintenance, Tire Costs

Author: Mike Antich | Posted @ Tuesday, February 19, 2008 12:08 PM | » Comments(1)

Author Bio

Mike Antich

Editor and Associate Publisher

Mike Antich has been covering the fleet management and vehicle remarketing markets for more than 20 years. During this period, Mike has written or edited more than 4,600 articles on the subjects of fleet management, manufacturer fleet activities, the fleet leasing industry, and vehicle remarketing. He was inducted in the Fleet Hall of Fame in 2010.

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