Most Challenging Year Ever
I think this year and last had to be the most challenging year ever in fleet management. COVID-19 put many hurdles into all aspects of fleet management and tested the abilities of fleet managers in ways unseen before.
The main challenges can be looked at near future one two, or three years down the road and the strategic challenges that will come thereafter. Some of these immediate and longer term challenges are:
Do More with Less: As COVID-19 stressed the financials of many companies, management immediately asked fleet managers to start and conserve cash. In some fleets it was easy as activity level constructed; however, in other fleet that task was not that easy. As soon as fleet activities started to go up due to increased business level, the expectation of management was that costs will remain low. Now fleet manager have to run their fleet with shrunk budget, and maintain the same activity level. This can only work in the very short time, and management will have to become more realistic and understand that the dip in fleet expenses was tied to lack of fleet activity due to a once in a lifetime event.
Go green without the” green:” As we hear more about global warming, more and more companies are jumping into “Greening the Fleet”. In most cases the fleet is the single largest source of CO2 and cutting any amount of that emission will make corporate look good. The biggest problem fleet manager face is that “greening the fleet” concept cost a lot more. However, no extra funds are allocated by management. At the same time new companies/OEM such as Tesla, Lordstown, Nikola, and Rivian are on the news constantly with new electric vehicle. But again, these new vehicles are not or will not be available for the common fleet for the next two to three years. This process of “Greening the Fleet” will require monetary commitment, and time to allow fleets not only to switch vehicles but to build the infrastructure around the new electric zero-emission fleet.
Last-Mile Travel: For all fleets that are involved in carrying any cargo from point A to point B last-mile travel is the new buzz word. This concept will allow companies to get supplies and materials via a third-party partner and will alleviate the pressure of having the right materials at the right time at the right place. Of course, for fleets this is a tremendous opportunity to both shrink the fleet and downsize many of the vehicles that currently are involved in material deliveries. Companies should not rush into this new concept without doing their homework. Both logistics and costs must be looked at prior to adopting this concept. When you contract with a third-party to do the lifting you are in away buying their inefficiencies. It might be better for companies to have a small segment of the fleet involved in last-mile travel rather than farm it out to third-party. This way the company will have full control of this new concept, and at the same time will allow for the rest of the fleet to do what is needed in shrinking both number and vehicle size.
Phil Schreiber, Fleet Consultant
My husband and I live in an area where there is a housing shortage and with the new interest rates being lower than ever, people are investing, moving from other states to avoid the winters, and snatching up homes left and right. Every single new build we have visited has a no commercial vehicle policy. Some existing communities with homeowners associations (HOA) have revised the covenants. We can’t find anything. Has anyone legally brought this up? At least allowing a percentage in the neighborhood. Or builders provide options to build the garage clearance higher so we can fit it into the garage. It’s my husband’s livelihood as an electrician, so we have to have the vehicle. At some point, some legal action will have to take place. I should be able to purchase a new home at a reasonable price point and park our vehicle in the driveway.
Submitted via e-mail by Maggie Cole
Tech is Transforming Glass
One of the top challenges fleet companies face is understanding the implications of vehicle technology growth, especially as it relates to the glass.
Vehicle technology didn’t take the year off, and manufacturers and auto industry experts have placed an increased focus on the glass in recent years. Annie Milner, head of future trends research at Belron Technical, shared some news from Apple’s R&D advancements. According to Apple’s recent patent applications, they are dedicating resources to vehicle glass, with one patent describing embedding display technology directly into the auto glass, giving manufacturers a host of new possibilities when designing the interior. Another patent details the necessary steps and parts for a vehicle to detect and warn drivers of cracked auto glass.
Coupled with the growth of glass complexity, there are implications of increased repair costs when vehicles require service. According to a report released earlier this year by Consumer Reports, windshield replacement for a vehicle fitted with safety systems technology can be as much as 400% more expensive than a vehicle without. In fact, according to American Automobile Association (AAA), at least one advanced safety system feature was included in 267 out of 288 (92.7%) of new vehicle models available in the U.S. as of May 2018. This percentage has only increased in the last two years.
Considering these statistics, fleets would be wise to include these rising costs in their budgeting and planning in the months and years to come.
Mark Klein, Assistant VP Strategic Accounts for Safelite Autoglass
You Got it Backwards
I read the blog “Five Reasons Why Fleet Managers are Terminated” and you may be right in some cases. In my experience, the reality is that it is often the organization and not the fleet manager that struggles with most of these issues. How many organizations are resistant to change, complacent, oblivious to discontent, or tech solutions averse? I think you have this one backwards. Organizations are still operating on “that’s not the way we’ve always done it” mentality.
Brian Reynolds, President of Reynolds Premier Motors in Brownsboro, Texas
Not a One-Time Event
The Market Trends blog entitled “Fleet Managers Must Partner with Field Operation to Meet P&L Objectives” was a great article.
Collaboration, which I describe as active listening and continually evaluating the status quo, is a fleet manager responsibility. This needs to be accomplished professionally and in a process-driven format and not as a one-time event. The professional fleet manager fills this role by developing a cadence for information sharing, be it monthly, quarterly, or annual reviews/events/meetings to share KPIs and progress towards shared objectives. This creates a proverbial “seat at the table” for fleet management to collect feedback from business leaders and operations. Fleet management can then coordinate fleet supply chain resources to provide timely response, corrective action, and support for business success.
Charlie Schott, Managing Director for Schott and Associates in New Canaan, Conn.