By Ed Smith, President, Agile Fleet
I have never been more confident than right now that vehicle-sharing is your best bet for running a cost-effective and safety-conscious fleet operation. I get it – this runs counter to much of the present narrative being offered, but to be blunt about it, there are aspects of the present narrative I feel are incorrect. Here’s why.
Since the pandemic hit us one year ago, fleets are being tasked to save money more than ever. The good news is it might not be as hard as you think. You may need to overcome misconceptions and understand where the dollars are to be saved.
Organizations face mandatory cost reductions, and even rounds of layoffs to meet the economic challenges of the moment. The workload, however, has not changed and may have increased. That’s why running a safe, shared vehicle fleet makes sense.
Sharing vehicles does not have to mean sharing germs, provided you are using a system that builds in scheduling safeguards. Your FMIS should reinforce behavioral expectations via policy communication and enforcement and provide definitive clarity about who uses vehicles and when for contract tracing.
“Save Money…Be Safe” Aren’t Mutually Exclusive
Both can be achieved by sharing vehicles in an automated, no-attendant required system like ours.
Let’s start with sanitization challenges we face in today’s pandemic reality. Our automated solution offers attendant-free, self-service access to vehicles and keys, reducing exposure and supporting social distancing. Fleet staff can manage vehicles remotely from a web browser, and drivers may schedule vehicles online.
Communicating cleaning protocols and policies is easy through our system, as is scheduling time buffers to facilitate vehicle disinfection. Vehicle custody is seamlessly recorded with 100% accuracy if contact tracing is needed.
Now, let’s address saving money. Did you know that for every underutilized vehicle in your fleet that you reduce, you save $3,500-$6,000 per year in maintenance, depreciation, insurance, parking, staff management time, and other expenses? Eliminating even 20 underutilized vehicles from your fleet can slash $70,000-$120,000 in annual costs. Over time that adds up fast.
Remember, every vehicle eliminated from the fleet is a “gift that keeps on giving.” Consider a passenger vehicle lifecycle and a fleet’s plan to hold it for five years before remarketing. Your returns start with that one-time remarketing revenue of ~$3,500 per vehicle, with the first-year reduced maintenance, depreciation, and insurance of ~$4,000 on top, and every year thereafter. The 5-year benefit of eliminating a single passenger vehicle approaches $23,500 per.
One client of ours is looking to reduce 150 vehicles from its fleet. We estimate this will save them more than $1.1M in savings over 5 years with zero negative impact to vehicle availability or utility. With this approach, you have all the equipment you need, and only what you need. Utilization data collected in the system builds a case for effective right-sizing decision-making. But how do you convince drivers it is a good idea to share now?
Overcome Force of Habit & Share Today’s Realities
If your drivers have used the same vehicles since they started with your organization, they likely have formed an attachment to it. Switching to a motor pool can be a hard sell, even in the best of times.
Focus on why it is actually better for them, and that it could save jobs. Be transparent, stating why vehicles must be shared: to eliminate lay-offs or to meet mandatory cost reductions. To make sharing cars more appealing, place newer equipment in the motor pool first. Offer more types of vehicles such as vans, pickup trucks, and maybe even luxury or electric vehicles for out-of-state travel.
Communicate other benefits, such as the convenience of being able to reserve a motor pool vehicle online, around the clock. And shared vehicles can support your organization’s sustainability goals.
The Time is Right
Cut out the vehicles you don’t need, get the maximum utility from the vehicles you keep, bring safety and efficiency to your workforce, and retain all of these benefits when things normalize post-pandemic.
With expectations for cost-savings at an all-time high, and the need to automate processes for the purpose of social distancing as urgent as ever, sharing vehicles now just makes sense. The only question left is, “What more could you ask for?”
Need more information about how to start a vehicle-sharing program? Agile Fleet has an e-guide to answer your questions and get your motor pool started. Agile Fleet also has a team of fleet experts at the ready to help you improve your fleet management. Call 571-498-7555 x1 and let us help. As always, reach out to me directly with any questions: mailto:[email protected]
