The Car and Truck Fleet and Leasing Management Magazine

Is an Owned Motor Pool the Right Choice for You?

June 2002, by Gene Allen

Most fleet managers more than likely have a program or procedure in place to provide supplemental vehicles, when necessary, to make things run smoothly.

The first real concern in supplying spare, additional, or temporary replacement vehicles is, of course the cost-effectiveness of keeping extra vehicles around. The cost of upkeep, insurance, registration, and the fact that when a vehicle is not assigned to an individual, it seems to have more maintenance problems, both mechanically and cosmetically, are all concerns when considering keeping spare units on the books.

One of the most cost-effective ways to gain a few extra units in the inventory is to hold onto some of the sharpest units being turned in at end-of-lease, and since your maintenance history, registration, and insurance coverage are already known items, it makes this spare option time- and cost-effective.

Michael Buffi, fleet manager for MetLife Auto and Home Insurance in Warwick, RI, said, "On occasion we will move a terminated vehicle into the pool. This is especially true if there is an immediate need to use the vehicle. One example is in the situation of an accident or a given office having several damaged cars. We will rotate the pool vehicle so each driver can get his respective car repaired and back on the road without having to rent a car. Once the cars are repaired or the short-term need met, we would then terminate the pool vehicle. Pool vehicles reduce the use of rental cars, personal car reimbursement, cabs and limos. But there must be cost justification to retain these vehicles. If they are not being used on a regular basis, they are terminated. We cannot afford to keep extra vehicles in the fleet for 'convenience.' The business climate is too competitive," said Buffi.

Cynthia Armstrong, fleet manager for FCCI Insurance Group of Sarasota, FL, told AF, "With few exceptions, our leased vehicles are closed-end, two-to-three-year leases. Recently we had a need for an extra car for a year, so I re-negotiated an additional year lease at a lower monthly rate on a vehicle that I was getting ready to turn in at end-of-lease. Other times I have retained end-of-lease vehicles for several months over lease term if I needed cars on a short-term bases."

Armstrong added, "We have approximately 100 leased cars assigned to our field employees. Employees who are not assigned company cars but need to travel occasionally on business may request the temporary use of one of the few pool cars we do keep.

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