At a Glance
Ways fleets can save on fuel include:
- Match the right vehicle to the right route.
- Monitor and reduce idling.
- Shift to lower gear when feasible.
- Use alternative fuels where it makes sense.
As long as fuel prices continue to rise, fleet managers will look for ways to reduce fuel spend. At the most fundamental level, reducing fuel spend comes down to two strategies: improving the fuel economy of existing vehicles and acquiring newer, more fuel-efficient models. Whether fleets must work with what they have or whether they have the budget to invest in new models, when fleets drill down into these two categories, they’ll find several smart ways to save.
Give Existing Vehicles an MPG Boost
From modifying engine performance to making smarter choices about what vehicles perform which jobs, fleets have several options to improve the fuel economy of their existing units.
Match the right vehicle to the right route. One of the simplest ways to increase fuel economy and reduce fuel consumption is by matching the right vehicle to the right route. With no software requirements or vehicle modifications, making an informed choice on what vehicles offer the best fuel efficiency per route can be a cost-effective way to spend less on fuel.
FedEx Express, a unit of FedEx Corp., has seen a major impact on overall fuel efficiency by matching the right vehicle to each route, an initiative that has pushed the company toward its goal of reaching a 30-percent increase in fuel efficiency for its global fleet by 2020.
With proper vehicle choice — such as alt-fuel vehicles for shorter routes and lighter vehicles for longer routes — fleets can save big on fuel. In fact, FedEx Express expects to save approximately 20-million gallons of fuel this year alone by pairing the proper vehicles to routes that allow them to maximize fuel efficiency.
Keep an eye on idling and shift smarter. RailCrew Xpress, a railroad crew transportation service, looked to lower engine idling and smarter shifting as a means of reducing fuel spend. To do so, the company employs software that modifies an engine’s computer to lower engine idle speed and shift threshold.
“Using a higher gear sooner lowers the overall rpm — and the fewer times the engine turns over, the fewer gallons that go through it,” said Dan Gammill, director of fleet operations for RailCrew Xpress. “Likewise, lowering engine-idle speed improves fuel economy, too. We believe the software modifications can provide up to a 30-percent reduction in engine idle speed, so we are burning less fuel at the stop lights and when we are waiting for crews.”
RailCrew Xpress piloted this strategy in two regions, Texas and Mississippi.
The Texas pilot was conducted over 20 weeks, with programming installed on 180 vans and tested in varying driving environments — some that see a lot of city miles and short-distance, gas-guzzling trips, and others that make long-distance, more fuel-efficient trips on the highway. In aggregate, the company saw a 5-percent improvement in fuel economy as a result of the software pilot. A similar 15-week pilot in Mississippi resulted in a 10.8-percent improvement in overall fuel economy, according to Gammill.
With an annual fuel spend of $12.5 million — if rolled out platform wide — the software alone would save the company somewhere between $625,000 and $1.35 million. “Our vans average approximately 60,000 miles per year, so our high usage yielded a pretty quick payback on the project,” Gammill said. “For our purposes, it looks like a very cost-effective, low-impact way to get additional fuel economy out of the same piece of equipment.”
Speed up speed restriction. Software can also help fleets restrict speed, helping drivers lighten their lead feet — and lay off wasting fuel.
“I’m a strong proponent of speed restriction,” Gammill said. “Study after study says you lose 5 percent in fuel economy for every 5 mph over 55 mph — and that deterioration could be even greater for us, considering the large passenger vans we drive. If you’re looking to cut fuel costs, one of the easiest places to look is applying speed restriction to your fleet.”
Switch to alternative fuels. Beyond software, modifying vehicles to operate on alternative fuels can reduce fuel spend in two ways: through a lower price per gallon equivalent and lower maintenance costs.
Stanley Steemer, a provider of residential and commercial cleaning services, has looked to alternative fuels as a means of saving money and helping to green its carbon footprint. Currently, the company is testing operating vehicles and equipment on compressed natural gas (CNG) and liquefied petroleum gas (LPG), aka propane autogas, fuels.
“Stanley Steemer is a unique business; not only do we burn fuel getting to a job, we also burn fuel while performing our cleaning service,” said Sean Vrenna, director of research and development for Stanley Steemer International, Inc. “By implementing lower-cost alternative fuels in both instances, we are hoping to see a significant savings in fuel cost.”
So far, the company has seen “very positive results” using the alt-fuels, according to Vrenna.
Initial fuel-cost savings on Stanley Steemer’s alternative-fuel vehicles is around 40 percent. “To date, we are pleased with how this pilot is going,” Vrenna said. “There are some significant costs in converting vehicles and equipment to run on alternative fuels. However, we feel our ROI time frame is viable. An added bonus we are seeing when using clean-burning fuels is a longer maintenance interval, thus providing additional savings.”
Buy with an Eye for Fuel Efficiency
The alternative to finding ways to make existing units more fuel efficient is buying new ones. But, that can mean different things — from simply downsizing to vehicles with smaller engines to taking advantage of the latest in vehicle technology. Both approaches can yield major fuel savings.
Rely on rightsized engines. While drivers in some vocations need power to get the job done, downsizing to vehicles with smaller engines can be a big fuel saver. FedEx Express currently has more than 10,000 vans with rightsized engines in service, comprising more than 35 percent of its U.S. pick-up and delivery fleet. Each van is about 70 to 100 percent more fuel-efficient than the original truck it replaces, according to the company.
Red Bull North America, Inc. employed a similar strategy. In 2011, the company instituted a 23-mpg threshold for all employee vehicles. It has now cycled out all older vehicles that did not meet this criterion. In 2013, Red Bull raised that threshold to 26 mpg combined. The new mileage threshold alone has increased its average mpg by about 5 percent.
To achieve this goal, the company replaced its larger V-6 and V-8 pickups with smaller four-cylinder SUVs. Where it used to see 14-16 mpg on the larger pickups, the fleet now sees 24-26 mpg on the smaller models. As a result of this change, the company is estimating a 10-percent per vehicle savings so far in 2013 versus 2012.
“It is easy to put thresholds in place, but, if the vehicles that qualify do not allow your employees to do their job in an efficient manner, reducing fuel spend can have negative effects on employee productivity and morale,” said David McCauley, fleet manager for Red Bull North America, Inc. “We were able to do this with very little impact on how our employees complete their daily duties. Our changes were successful because we picked vehicles that met the threshold, but also were functional enough to allow our employees to do their jobs properly.”
While replacing vehicles can mean additional costs, McCauley said in Red Bull’s case it saw an unexpected benefit. “We had assumed that terminating 110 pickups over a three-month period would cost us around $20,000-$30,000 in loss on sales, especially because 68 of them were less than 18 months old,” he said. “Instead, it happened at the right time and we actually netted more than $175,000.”
Go hydraulic. In addition to engine size, engine type can also help fleets reduce fuel spend. Hydraulic hybrid vehicle systems use a computer-controlled system to eliminate unnecessary engine operation, which, in turn, saves fuel and reduces engine wear and tear by up to 50 percent. FedEx Ground is currently testing hybrid hydraulic parcel delivery vehicles on local delivery routes across the U.S.
Lighten the load. While engine size and type can make a big impact on fuel economy, so can the weight of the vehicle. Composite-body vehicles can make vehicles hundreds of pounds lighter than their traditional counterparts; the lighter the vehicle, the more fuel efficient.
Since 2011, FedEx Express has incorporated almost 200 composite-body vehicles into its global fleet and plans to add 200 more by the end of its 2013 fiscal year. The lower-weight design, along with the fuel-efficient engine in the model used, allows for a 35-percent reduction in fuel usage over most conventional walk-in vans.
Set Your Strategy
Regardless of whether a fleet seeks to improve the fuel economy of existing vehicles or to purchase new models, McCauley said the first step is to know what your goal is — and never lose sight of drivers’ needs. “Set yourself a goal and then build a strategy around that goal,” he said. “Remember that, while your goal is reducing fuel spend, you do not want to lose the money you gain by having employee productivity suffer.”
Keep An Eye on Fuel Prices
Want to keep an eye on fuel costs? Fueleconomy.gov offers the following resources to help keep fuel costs down:
Local Prices: www.fueleconomy.gov/feg/gasprices/states/index.shtml
National and Regional Prices: www.eia.gov/petroleum/gasdiesel/