Fleet managers are responsible for running a cost-effective and efficient operation. Maintaining such a fleet requires strategic vision and understanding of all the stakes.
Here are 6 Ways to Cut Fleet Management costs. Whether you decide to use Fleet GPS trackers or enforce better driving habits, your strategy will depend on your objectives. It’s important that you always talk to other fleet owners, managers and CEOs to find out the latest best practices.
Here are a few suggestions that can help you on the way:
1. Reduce Fuel Consumption
For any fleet, fuel consumption is one of the highest expenses. Also, market fluctuations make fuel costs unpredictable. Because it’s a known issue, there are lots of potential solutions.
Most fleet owners start with acquiring fuel efficient vehicles. Businesses should also pay attention to vehicle weights and transmissions. If your fleet vehicles are carrying extra weights around, it will add to your fuel costs. Sometimes the extra weights might not even register. Set up a monitoring system, so your analytics department can collect and track the weights on vehicles and flag any anomaly. Real-time vehicle tracking systems can be very useful. Also, outfitting your cars, vans and trucks with efficient transmissions can lead to fuel savings.
According to the Energy Information Administration (EIA), the fuel consumption of motor vehicles has decreased from 725 gallons per vehicle in 1950 to 658 gallons per vehicle in 2016. That’s around a 9% decrease in fuel consumption. It means OEMs are responding to the markets need for fuel-efficient vehicles. Talking with your manufacturer to find out the right replacements can be a good starting point.
You also have the option to outfit your fleet with alternative fuels like natural gas, bio-fuel, or propane. These alternatives can save you money in the long run. However, you need to look at the upfront cost of outfitting your fleet and figure out if the return on investment (ROI) makes sense.
2. Create a Regular Maintenance Plan
For large fleets, fleet owners have to often make hard decisions between maintaining old inventory or buying new vehicles. Extending vehicle life is obviously beneficial. But it’s only possible through a robust maintenance plan.
The maintenance plan itself should be vetted regularly. Fleet businesses are about efficiency and cost-effectiveness. It’s important to question the general assumptions about maintenance practices to weed out wrong notions. There might be false beliefs like every vehicle needs to go through maintenance every 5,000 miles. It might be true for some heavy-duty cars and trucks. But it doesn’t make sense putting every car through the same routine.
Also GPS tacking device for cars can help you get better understanding of your fleet’s general health. Advanced tracking and team cooperation can help you custom tailor your maintenance plans for various types of vehicles. It will increase their life-cycles while keeping your costs down.
The maintenance plan should also cover retention objectives. Retaining a vehicle through maintenance might not always be desirable. The maintenance crew should be knowledgeable to recommend replacement times. Keeping older cars and trucks can end up in higher maintenance costs. It’s better to get rid of vehicles as soon as they lose their efficiency.
3. Consistent Tire Servicing
Tire servicing requires a special mention as it can effect both fuel consumption and maintenance costs. Rising tire prices has been an issue for the fleet industry for a long time. Both Goodyear and Bridgestone/Firestone has declared significant tire price hikes as recent as last year. The general tendency of the fleet industry has been to be lax about tire servicing. But it can lead to fuel inefficiency and cause more accidents.
Tire servicing requirements can vary for different business types and vehicle types. For trucks and cars that operate under severe weather conditions, the servicing might require shorter cycles. Vehicle tracking devices should give you the data necessary to optimize your tire servicing strategy.
4. Enforce Economical Driving Habits
Future vehicles will come with more advanced features to track driving statistics, especially with autonomous cars. However, before that becomes a reality, the behavior of your drivers will greatly impact your bottom line. The way drivers accelerate, brake and steer trucks and cars have a direct effect on the longevity of vehicles. Improper use of air-conditioning (e.g. running AC with windows open) or inconsistent speeding can lead to higher fuel costs.
The best way to improve driving habits is to train your fleet drivers. There are also real-time vehicle tracking systems available that can monitor and alert bad driving patterns. You can also use reward programs to promote good behaviors. The combination of education and incentives can help improve driving patterns.
5. Reduce the Number of Vehicles
The size of your fleet dictates your overall expense. Each car comes with an associated cost. You can monitor the information on various types of cars, trucks and vans. This will help you observe the total cost of ownership for each type of vehicle.
At times, you’ll need to expand your fleet to meet demands. But it’s also important to purge unnecessary vehicles when demands subside. When your reducing the number of vehicles, take into account the increase in operating costs of the cars and trucks that will take over some of the responsibilities of the retired ones. Perform a cost-benefit analysis to get an accurate understanding of your particular situation.
6. Install Fleet GPS Tracking
Car Tracking devices can be a great investment for your fleet business. It can help you improve fuel efficiency, reduce maintenance costs, promote good driving, and help you build accurate business analytics.
For example, a real-time vehicle tracking system can reduce idling. Idling causes damage to the engine and reduces the longevity of various engine parts. Vehicle tracking devices can monitor idling situations and raise the necessary red flags. They are also good for monitoring driving habits and unauthorized vehicle use.
A GPS tracker for cars are proven to reduce down time and encourage productivity and task accountability from drivers. They can also help improve maintenance plans. Instead of using centralized maintenance hubs, you can distribute your maintenance across various locations. The aerospace industry is using IoT-based GPS tracking devices and machine learning platforms to create predictive maintenance plans. The fleet industry can take similar steps.
Putting it all together
In order to thrive as a business, fleet owners need to look at both their short-term and long-term goals. Some decisions are not easy. Do you keep old cars and carry a higher maintenance burden or do you invest a large amount in updating your fleet? Do you put money into Car GPS trackers to automate or do you train your drivers? The final answers will depend on your vision for your business