The Car and Truck Fleet and Leasing Management Magazine

2015 Fleet Industry Report Card: OEMs

May 2015, by Mike Antich - Also by this author

Photo via istock.com
Photo via istock.com

This annual survey, now in its third year, is designed to provide an industry “report card” of the services and products offered in the commercial fleet management market by automakers and fleet management companies (FMCs).

Fleet managers are mostly satisfied with the products and services available to them; this sentiment was validated once again with the 2015 survey. The survey is segmented into two parts. Part one examines how fleet managers view their OEM suppliers. Part two rates how FMCs are serving their fleet customers.

Below are suggestions from fleet managers — in their own words — on how OEMs can improve the services offered to them. Responses have been kept anonymous so as not to identify specific OEMs and FMCs.

Fleet managers were asked: “What one area do you think the auto manufacturers have the most need to improve, and could you elaborate as to what they should do to bring about this improvement?”

At A Glance

Fleet managers gave the following feedback about OEMs:

  • OTD consistency is needed.
  • Improve parts availability.
  • Some dealerships can't service medium-duty trucks they sell.
  • Expand safety equipment offerings to lower trim levels.
  • Complexity in option coding.
  • Post-warranty coverage concerns.

Fleet managers surveyed for this year’s report card, overall, gave the OEMs high marks in a number of areas, including:

  • Vehicle quality.
  • Field account representation.
  • Ease of factory ordering.

However, in the spirit of helping the industry, fleet managers also identified areas where improvement can be made in OEM products and services. Here’s what they told us:

Standardize New-Model Intros

“Standardized model-year introductions and pricing information is needed for the industry. The standard model-year rollout of mid- to late-summer has vanished. We, as an industry, no longer have traditional model-year cutoffs and startups. It is extremely difficult to perform total cost of ownership (TCO) analyses and make confident recommendations for our companies.”

Improve Quality Assurance

“Quality assurance is a place where OEMs could improve today. With all the new-vehicle technology, we are seeing more and more warranty items come up. Thus, our downtime is increasing and the need for spare vehicles is also increasing.”

Need to Return to Consistent Model-Year Production Schedules

“Delivery times are way out of whack. We had trucks last year that took 16 to 18 weeks just to make it to the upfitter. Then, the upfitters are so behind that trucks are there for four to six weeks, and then another month (if there was no bad weather) for the trucks to make it to the dealership. It makes promoting factory orders a really hard sell within our organization. I am not really sure exactly how to resolve this issue, but clearly new rail cars are needed. It would be nice if they could get back on a consistent model-year production again. Right now, they are all over the board, which makes planning a bit trickier.”

Improve Parts Availability

“There needs to be better parts availability, especially in cases of recalls. Quality, overall, needs to be improved to avoid all these recalls. Also, better access to vehicle status is needed when vehicles are being held up at the plant for quality control issues/inspections. A special report, periodic e-mails, or a website to check status would be nice.
“Decreased time to repair and the ability to get parts quickly is also needed. The OEMs need to get more fleet-centric dealers who understand repeatable repairs for forecasting parts inventory. And, how about improving the quality of the parts that fail over and over again?”

OEMs Need to Upgrade Training of Dealership Technicians

“Manufacturers need to upgrade the required training of the dealership technicians. It seems that many technicians lack knowledge in late-model diagnostics and repair procedures. Dealerships are independently owned and required to go through an approval process for warranty repairs, which increases equipment downtime. Dealers should be held to certain standards of customer service with commercial vehicle customers, such as a threshold of an acceptable amount of turnaround time versus weeks or, in some cases, months.

“Put in place a high-level courtesy delivery process that FMCs, drivers, and fleets who buy from multiple dealerships can work with. I know of fleet managers who have changed the make of their fleet based solely on the inability of OEMs and their dealers to properly manage the courtesy delivery process — just having access to an OEM’s fleet website is not enough.”

Post-Warranty Coverage Concerns

“Auto manufacturers can improve on service after the sale. One area would be post-warranty assistance. We have a mixed fleet and the overall post-warranty service levels provided by the manufacturers vary tremendously. We have one provider that is willing to listen to our maintenance issues and will assist if they agree it is a large problem or the failure is abnormal and should have never happened. We have another manufacturer that will deny any post-warranty assistance if it is literally one mile past the stated warranty. Unfortunately we just had this situation, and, it is not an exaggeration — the transmission went out at xx,001 miles and they would not do anything to help us. Another item within that is their dealer base. Many times, fleets are left dealing with a local dealer to try and work through a difficult repair and it seems that you are always escalating the issue to the service manager with hope of prevailing. Some of the manufacturers are identifying their high-performing fleet dealers, but they still have a long way to go with getting a large percentage of their dealers on board.”

Be More Strategic

“Our relationship has to be more than numbers associated with an annual buy. What about driver ergonomics, safety, fuel efficiency, etc.? It would be nice to have better access to subject-matter experts, so buyers can make more informed decisions beyond TCO.”

Accelerate Implementation of Vehicle Connectivity

“OEMs should have factory options for full telematics solutions available for fleet customers. All the technology is in place, but not the full integration.”

Incorporate Open Architecture

“I would like to see manufacturers continue to accelerate ‘networked car’ capabilities and ‘smart drive’ safety features. Although the progress has been impressive over the past decade, the ways and speed with which we can capture data are growing exponentially. I would ask that manufacturers act more collaboratively and much more nimbly to put these technologies in their products.”

Better Technology Integration

“The mobile device environment is changing rapidly, but we are struggling to physically install the units. We have challenges with connectivity and dashboard geography/topography, and I would love to see OEMs incorporate an open architecture into their cab designs so we can install (and remove) these units with ease, thus reducing costs, but also enhancing safety in that we can limit transgressions into driver sight lines or missile hazards in the cab.”

Option Packaging Impact on Safety

“Corporate fleets would like to be as safe as possible, but cannot always afford the highest level of safety equipment because OEMs position the latest options on expensive trim packages. Fleets should be able to select any safety package on fleet-equipped models.
“There is a real need to bring safety features, such as collision avoidance, lane departure, adaptive cruise control, cross traffic alert, and blind spot monitoring, to lower trim levels. These safety features will pay for themselves by reducing or eliminating accidents, but, with many manufacturers, they are only available on higher
trim levels.”

Expand Fleet-Only Option Packaging

“I would like to see the manufacturers develop and execute a ‘fleet-only’ trim package. Too often, to equip vehicles with safety features fleets should have, they are buried in a package with leather seats, moon roof, etc. I don’t believe these vehicles would be less valuable at the auction since many consumers would like to save money on a used vehicle without compromising safety.”

Expand Safety Equipment Offerings to Lower Trim Levels

“I would like to see auto manufacturers work together to have consistency in safety equipment, especially on the lower trim level vehicles. We all understand this is going to add some cost to the vehicle, but, by adding, we can decrease costs in other areas, downtime for repairs, the cost to repair, and the loss of productivity and even lives.”

OEMs are Driven by the Retail Market to the Detriment of Fleet

“OEMs generally, to be fair, do a good job providing products and programs for fleet markets; however, items such as allocation remain an issue. Unlike FMCs, whose market is entirely fleet, OEMs are driven by retail markets, which are far larger and less predictable. If a popular fleet vehicle is also a hot product in the retail market, the latter will get preference when allocation is set. It’s a simple fact of life for OEMs. Fleets, though they buy hundreds of thousands of these popular products each model-year, are dwarfed by retail markets that buy millions, and OEMs can hardly be blamed for addressing retail first. OEMs can improve on communicating with fleet buyers, particularly regarding OTD times and build-out dates. One thing that angers fleet managers more than any other as it pertains to OEMs, is having dozens of new orders in the bank that they learn, often at the last minute, won’t be built, and having to then scramble to address the problem. In some cases, there are OEMs that can better address fleet needs with ‘fleet spec’ models not for sale to retail buyers, particularly in the growing light-truck and van markets.”

Complexity in Option Coding

“Option coding when ordering vehicles is a concern. There is often a miscommunication on the changes of options, on new model-year vehicle. I’ve seen this confuse dealerships, to the point that they have been left high and dry for days or weeks until concise/clear direction has been decided and coded, thus misidentifying and/or holding up order/delivery of units with proper options, only to get the explanation, ‘Oh, they changed the order code.’ ”

Need for Greater Accountability and Better Customer Service

“Customer service is an area needing improvement. That is really lacking on the OEMs’ part when it comes to fleet. Please provide accurate information and stand behind your promises! I’ve just come out of a nightmarish experience with what, to us, was a large order of vehicles. No one could confirm where they were for several weeks. And, when they were ‘found’ all I got was finger-pointing and nothing was offered to help make up for the time lost — and time for us equals money. Convoluted explanations in an attempt to prove they didn’t really lose track and/or forgot to tell anyone where these vehicles were did nothing to resolve the situation. My personal experiences with the same company have all been great. But, care for the customer does not exist on the fleet side. I buy more fleet vehicles than personal ones! Why am I left feeling unimportant and a nuisance rather than a customer?”

Ability to Cancel One-Off Units

“I would like to have the option to cancel a ‘one-off’ new order unless it has a specific build date assigned. With order-to-build periods increasing dramatically, many events change, including not having the need for a specific vehicle.”

Provide Accurate Fuel Economy Ratings

“I wish OEMs would accurately state fuel economy under real-world conditions. To calculate fuel economy in a lifecycle analysis, I actually test drive the cars under consideration to get actual mpg results. Some manufacturers are very accurate, while others are not near the published mpg. As a fleet option, I think all the vehicles should transmit telematics information. Buying the little devices and keeping them plugged in is a challenge.”

Importance of Small Fleets

“Now that OEMs are experiencing an overall upturn, the consensus of many is that fleet is falling backwards in their attention to detail. Small-sized fleets are not getting attention and are being passed off to call centers. Seeing or hearing from the fleet representatives is beginning to lag. We all thought the last time the market did this the OEMs learned from this, but evidently retail is wagging the tail of the dog again and fleet is falling by the wayside.”

Develop ‘Fleet Grade’ Alternative-Fuel Vehicles

“Manufacturers have an opportunity to provide ‘fleet grade’ alternative-fuel and hybrid vehicles to their fleet customers. It seems all of the manufacturers use a strategy when introducing a new alt-fuel vehicle to recover their initial investment by offering only a luxury grade vehicle. Increased volume is another strategy, which lowers cost by realizing economies of scale (e.g., volume purchasing and manufacturing). Fleets would embrace new technologies and alternative fuels more rapidly if the cost was reasonable and amenities were comparable to their existing selector/specifications.”

Fleet Account Executives

“There is not much they need to do in my opinion. They sell a good versus a service. I would say the fleet reps are very overworked by all manufacturers. They have stretched them too thin and now response time is an issue.”

Read part two of the fleet industry report card covering FMCs.

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