AF Fleet Readers Sound Off on Costs, Sourcing & More

Automotive Fleet seeks to facilitate a forum for different industry  voices to discuss today’s challenges. This regular column is designed to provide a platform for fleet professionals to let their voices be heard among their peers and other industry professionals.

Here is what is top of mind for fleet professionals today:

GREAT INTERVIEW

I watched the State of the Fleet Industry video on “Strategy to Unify Wheels Donlen & LeasePlan Businesses.” What a great interview with CEO Shlomo Crandus. You asked a lot of questions that many in the fleet industry would ask. This will not be an easy task, but there are certainly a lot of really great people in these three organizations. All the best to Shlomo and his team.

Mike Pitcher, President, Global Business Systems, Soaak Technologies, Atlanta

Editor note: Mike Pitcher was CEO of LeasePlan USA from 2008–2017. 

IDENTIFYING ADDED VALUE

We love AF Editor Mike Antich and the inside information that he brings to the commercial fleet industry with his weekly State of the Fleet Industry video series. In the video entitled “Model Availability Derails Fleet Standardization,” the manufacturers are still favoring production to units with options added. Our team at Randy Marion Automotive is helping clients order the proper vehicles for their fleet and coaching them on vehicle options they should include. Which options are of added value to your fleet? Would you add an element of tech or switch a trim level if it helped guarantee production? Let us know, and we will help guide you through the reality of the current fleet ordering situation.

Devin Royal Fleet Sales, Mooresville, N.C.

PROACTIVE NOT REACTIVE

The Market Trends blog, “The Best Fleet Management is Proactive not Reactive” written by Mike Antich, was a great read. It focused on the importance of proactive fleet planning. With continued uncertainty around vehicle supply chains in 2023, it’s crucial for businesses to be proactive in maintaining, repairing their fleet and keeping their hard-to-find employees safe.

Eddie Magallon, Account Executive, Enterprise Fleet Management, Los Angeles

PREDICT AND PREVENT

Mike Antich offers a terrific perspective in his latest Market Trends blog entitled, “The Best Fleet Management is Proactive not Reactive.” Simply reacting to the challenges your fleet faces is no longer viable. To effectively minimize operating costs and optimize vehicle uptime, you need to proactively “predict and prevent.”

Anthony Foursha, Executive Vice President, Sales and Service Excellence, Holman, Mt. Laurel N.J.

I’VE LOST COUNT

I agree with the video entitled “Fleet Managers Speak on the Need to Restore Trust Lost Between Buyers & Sellers.”

I've lost count of the conversations I've had the past couple of years with customers who now doubt the quality of their relationships. What is your plan to conquest those customers and show them how you are different?

Erik Gaspar, AVP Fleet Management, Vendor Management, GM Financial, Sturbridge, Mass.

MUST-ATTEND CONFERENCE

A few years ago, Mary Barra, CEO of GM, said of the automotive industry: “We’re going to see more change in the next five to 10 years than we’ve seen in the last 50.” This is turning out to be very true with the rapid conversion to EVs, the supply chain and shortage issues, etc., all of which affect fleets globally as much as retail. As such, now more than ever, attendance at the Global Fleet Conference is a “must attend” event, as new developments are happening at a much quicker pace.

John Possumato, Esq, Founder & CEO, DriveItAway Inc, Philadelphia

FORFEITING FLEET CUSTOMERS

I watched the State of the Fleet Industry entitled: “Fleet Costs are at Record Levels, but the Full Impact has Yet to be Felt,” and I asked myself: What about the turn to electric?! It’s an interesting time to be a fleet manager; especially with every auto manufacturer buried in retail sales.

They are not even thinking about selling fleet vehicles for less than list! SAD. They are forfeiting their fleet customers.

Steven Contarino, Vice President, Adamson Industries, Corp., Haverhill, Mass.

COMBATTING HIGH FLEET COSTS

Mike, great insights as always with your recent State of the Fleet Industry video report entitled, “Fleet Costs are at Record Levels, but the Full Impact Has Yet to be Felt.”

As a provider of vehicle sharing and right-sizing tools, our company is seeing more and more interest across a wider variety of fleet segments. All costs are rising. If you can do more with less while still providing high-quality services to all fleet stakeholders, why wouldn’t you? Except for the time frame around 2008 and 2009, the answer has often been, “Because we don’t have to cut costs.” Well, now you do.

It seems obvious that if a vehicle is underutilized, you remove it from the fleet or reassign it. But then what? How does the job get done and get done effectively and efficiently while maintaining your brand/image and limiting risk (e.g., from an unsafe personal vehicle)? You need a solution. How will vehicles be provided to get the job done?

Making the process of getting a vehicle as easy as the process of getting a boarding pass at an airport takes away many of the usability arguments of the past related to sharing. When vehicles can be easily shared, at least five of the costs you mentioned drop dramatically. Sharing increases utilization and decreases the size of fleets while providing a high-quality experience for drivers. It’s just one tool to combat rising prices.

Ed Smith, President, Agile Fleet, Chantilly, Va.

SOURCING ANXIETY

Wow. Great reporting as always by our friend Mike Antich of Automotive Fleet magazine with his article “Sourcing Constraints Continue to Cause Anxiety Among Fleets in 2023.”

Check out this quote: "With most motor companies not taking on any new customers and/or allocation is based on loyalty and a three-year history, you can’t consider going out to bid or even trying out their EVs for a pilot program."

So, here’s where I add my commentary; it’s more important than ever for fleet operators to reduce idle time. They need a way to reduce millions and millions of extra miles from idling, grinding down the assets, distorting the bathtub lifecycle curve and the business model for the fleet.

It's also super-expensive; the cost from all of this damage to the insides of a vehicle are more expensive than the cost of fuel burn itself from idle time.

• Each hour idling = 30 miles.
• Each mile = $0.10 - $0.30.

And it doesn't end there. As our affiliate partner Longobart-Ross Consulting tell us, the “vehicle equivalency ratio” determines how many techs are needed per asset. Therefore, the more miles travelled or idled, requires more maintenance costs and more staffing. Get your organization's fleet operations idle reduction strategy started with a no-cost idle reduction opportunity assessment.

Ron Zima, CEO, GoGreen Communications, Halifax, Canada

PAIN AND FRUSTRATION

Every day I hear from companies that express pain and frustration in regard to the record-high costs associated with operating a fleet. Some feel they've been priced out of the market completely. Experts like Mike Antich of Automotive Fleet suggest that fleet budgets will continue to be adversely affected and the full impact of high cost has yet to be felt.

Camerin Crowal, Leasing Consultant, Motorlease Corp., Farmington, Conn.

A HUGE CHALLENGE

After watching the State of the Fleet Industry video entitled “Inconsistent Service Levels for Fleet Registration & Titling Persist at State DMVs,” I want to let you know that this has been a huge challenge for public sector fleets as well. We used to fulfill registration and titling with in-house personnel. We have now gone to a registration and titling service because of the time it takes and the nuances associated with this process for our city fleet.

Craig Crowder, Fleet & Facilities Manager, City of Beverly Hills, Beverly Hills, Calif.

PLAYING THE “LONG GAME”

I agree with the Market Trends blog that offered the proactive vs. reactive recommendation, but I contend that effective and certainly successful fleet managers have been proactive, by necessity, all along. The differences in today’s reality are that information comes faster, both peer and upper management are less aware of fleet’s value add (not a criticism but a fact of current life) and management emphasis is often misdirected towards short-term profit and immediate sustainability instead of playing the “long” game.

You mention performance measures must be accessible; this is where you and I part ways. In today’s fleet world, performance measures must not be simply accessible and defined by fleet specific terminology such as availability and downtime. Instead, performance measures should directly address the needs and priorities of the user, department or customer, and continually communicated directly by fleet to their peers and to upper management. In this way, fleet’s value is directly offered and defined, not in fleet terms but instead becomes readily transparent to those who benefit the most from fleet's execution.

Accessibility alone is not enough. Departments themselves are too busy with their own “stuff” to take the time to query fleet's performance. The proactivity you suggest must be overtly practiced by fleet by reaching out to peers and senior management directly to assure fleet is not ignored.

Further, fleet personnel must have a “seat at the grownup table to articulate all of the ramifications that may accrue from a desire to maximize short-term results at the expense of long-term detriment. This level of respect and inclusion can only come from a constant demonstration of professional expertise that comes from regular and continuous consultation with peer and upper management at every opportunity regarding fleet's contribution and benefit to their successes.

You're right, the insular flezation and continually translates fleet successes into how those successes have contributed to the overall success of the whole. Thanks for your support of our industry.

Bob Stanton, CPM, CPFP, Fleet Management Consultant, Roswell, Ga.