The Car and Truck Fleet and Leasing Management Magazine

NAFA Foundation Offers New Residual Value Tool

April 2007

Fleet managers are always concerned about the residual value of their vehicles. And they should, since the greater the residual, the more money a vehicle brings in when it leaves the fleet and the better the company’s bottom line.

The National Association of Fleet Administrators (NAFA) Foundation seeks and develops projects to assist fleet managers, manufacturers, affiliates — the overall automotive fleet industry — with difficult and often complicated decisions. The latest such project is a listing of comparative residual values from three major services offered on the NAFA member Web site.

Automotive Fleet spoke with Jim Anselmi, NAFA Foundation president about the non-profit organization’s new residual value tool. “Residuals and remarketing values have always been all over the board,” he said. “We’ve asked some major suppliers of this remarketing data if they would be willing to share it with us, and we would publish it on our Web site,”

Jim Anselmi, president, NAFA Foundation

Three Publishers Supply Data
Black Book, Manheim, and AuctionNet agreed and are supplying data on a monthly basis for the 25 top fleet vehicles, as designated by Automotive Fleet.

“We launched it in January,” Anselmi said, “and we’ve gotten some good feedback on it, because it is a ‘one-stop shop’ for comparative resale analysis. As we all know, while published new-vehicle pricing is easy to get and very consistent, used-vehicle pricing is all over the place. It varies considerably. So by having the different benchmarks and data points, you can make a reasonable estimation or data analysis to find if your vehicles are selling above or below market value.”

List Undergoing Continual Refinement
Anselmi noted that the listing is still a work-in-progress and is being adjusted to improve usability and functionality.

“We will put mileage information in there in the future,” he said. “We’re going to continually enhance the site as we get feedback from fleet managers and others who use it.”

“So far,” he added, “what we’ve heard is that people are glad there is an extra tool available to benchmark their fleet. Some people have suggested enhancements, and we have put them into the works.”

He reiterated that product development is on-going, with improvements based on user feedback. “We appreciate the people at Black Book, Manheim, and AuctionNet for supplying this information and working with us to get their data into a format we can manage on the monthly basis,” he added.

Financial Analysis Tool Offered
Anselmi concluded by mentioning another important management tool available from the NAFA Foundation. The downloadable software program, Lease vs. Buy vs. Reimbursement Version 1.2, was created by the Foundation in conjunction with Deloitte & Touche LLP. This software enables users to input data gathered from their organization to create a detailed financial analysis. It is an effective tool for fleet managers to not only evaluate costs, but determine the relative advantages of various vehicle funding avenues.

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