During economic uncertainty, senior management demands expense reductions and limits capital expenditures. Since fleet is usually among the top 10 corporate capital expenditures, there is pressure to defer vehicle replacements. However, this cost-containment strategy misses the point that all fleet-related expenses, both fixed and operating, are influenced by when a vehicle is replaced. Cost reductions in acquisitions are often offset by rising costs elsewhere.
How Will Future Residual Values Impact Hybrid
While hybrids can reduce fleet fuel expense, the two other major fleet expenses — maintenance/repair and depreciation — must also be considered to determine if hybrids are the answer to reducing overall fleet costs.