Automotive Fleet's long-time editor and fleet expert, Mike Antich, offers opinions and ideas on the overall commercial fleet industry and draws interesting comments from fleet managers and other industry professionals from across the country. Mike was inducted in the Fleet Hall of Fame in 2010.
Summer is a busy time in fleet. There’s an abundance of next-model-year OEM fleet meetings, new-model intros, and industry conferences, which offer ample opportunities to “talk fleet” with the movers and shakers of our industry. If you want to know what's happening in the fleet market, you need to talk with fleet managers -- lots of them.
The stability of fuel pricing over the past 36 months, along with ongoing improvements in vehicle fuel economy, have been the key factors keeping fleet operating costs relatively flat.
Senior management exerts intense pressure on fleet managers to control and/or reduce vehicle acquisition and operating expenses. To accomplish this, a fleet managers can pursue three different cost-control strategies — cost savings, cost deferral, or cost avoidance. In order to implement a successful cost-control strategy you need to institutionalize the mechanisms to curb money-wasting behaviors.
There is a difference between a well-managed fleet and a best-in-class fleet. A “best-in-class fleet” is one that represents the top-tier performance level in its specific industry segment.
Any time you make an exception to fleet policy in resolving a driver-related problem, you may potentially create a new problem that will come back to haunt you in the future.
To be successful on a sourcing team, you need to be open-minded about exploring all available service channels and partners. However, open-minded doesn’t mean being open-headed. You must listen and entertain new ideas, but also temper such a practice and attitude with pragmatism and knowledge.
In the long run, technology will exert inexorable downward pressure on overall fleet size and will eliminate altogether the need for some fleet vehicles. Despite this, fleet management will survive, albeit in a smaller capacity, and, most likely, in a completely different form than what we know today.
I asked one fleet manager how he spec’ed replacement trucks for his fleet application. He related that many years earlier an OEM rep spec’ed out his trucks and he has been using the same formula ever since. While this may work in some cases, specifications should be defined by today’s fleet application to ensure the replacement truck is designed to accommodate current operational requirements rather than trying to make your operation conform to trucks spec’ed for yesteryear’s requirements.
Reducing fleet costs is a constant, never-ending struggle for all fleet managers, especially since every aspect of fleet management revolves around money. In lieu of requesting additional budget dollars, one course of action is to stop the waste of existing dollars.It is estimated that, on average, 5-10% of a fleet’s annual budgeted dollars are wasted.
One challenge to global fleet management is adjusting to different fleet terminology for different regions. One example is the difference between the use of “model-year” and “calendar-year” in describing the year of a fleet vehicle.
Properly identifying payload parameters is the foremost consideration to properly spec’ing a truck. To illustrate this fact, the weight of the payload will determine the engine, transmission, size of tire, frame, and just about everything else.
Looking ahead, how will procurement and fleet evolve in the future? My prediction is there will be market forces (both internal and external), along with technological enhancements, that will facilitate a much closer collaboration between the two disciplines using a combination of in-house and outsourced expertise.
In many ways, innovations in consumer technology are outpacing innovations in corporate technology. With this in mind, it is important to watch how technology is evolving outside of fleet and how it can be incorporated into day-to-day fleet management.
A great global fleet manager is a strategic thinker and visionary who has the ability to develop and communicate this vision. There isn’t a single trait that epitomizes a great global fleet manager; rather, it is a multitude of traits interacting with one another.
Just as with fleet management, there are many disruptive changes anticipated in the broader discipline of corporate procurement, much of it technologically driven. Many of these changes will directly impact fleet sourcing decisions.
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