Keeping cars in service longer since the advent of the energy crisis has been a consideration by many and a number of firms have instituted new policies on replacement. Some leasing companies have recommended extension and factory fleet sales have felt a significant impact as a result.

Hallmark Cards of Kansas City is one of the professionally managed fleets that has not only done something to meet the problem but has turned it into an opportunity and has the documentation to prove it.

Hallmark's fleets are totally company-owned and consist of 1050 cars operated in all 50 states. Two years ago the bulk of these cars were full size units. As replacement occurs, they are now being replaced with intermediates. The fleet now stands at 55- percent intermediates and eventually will be 100-percent.

For several years Hallmark had an effective policy of trading cars every three years or at 50.000 miles, which ever came first. In early 1974, Kramen Allen Manger of Services for Hallmark and Helen Bland, fleet manger were alerted to the then low level of the used car market. A decision was made to hold some cars and not trade them in until the fall. This, obviously, gained them a larger than usual number of high mileage cars at the end of the model year.

During the fall they traded 300 cars. After all transactions were completed, they pulled a 'sold car' report  from their computer and enlisted  the aid of their Investment Analysis Department to determine the optimum trading cycle in terms of cost.

The study was made objectively and included all the factors included in owning and operating the cars. It was based on actual depreciation, cost less trade value. The specific 300 cars were 1972 and 1973 standard size Ford Galaxies, Chevrolet impalas and Plymouth Fury models.

The study reveled that their cost per mile was less with each succeeding 5,000 increment driven through 65,000 miles; 1.5 per mile less for a car with 65,000 miles than one with 50.000 miles. (Note: there were insufficient cars in the 70,000 mile category to analyze properly).

Allen and Bland studied the results and noted that with the small percentage of units in the 65,000 mile category (8-percent) that a policy of retaining the cars for 60,000 miles was prudent. On a time basis, they will continue to maintain a three-year age level since the average months in service of the cars sold (the 300 in fall of 1974) was 25.6 months. Another similar study is planned after accumulating data on the new 60.000 mile cars.