Automotive Fleet
MenuMENU
SearchSEARCH

Giacchi Nets $22.7 Million in Savings for Lorillard’s Fleet

Vendor/supplier negotiations account for a $10.5 million piece of the pie. Other areas with large savings over the past 15 years include safety programs, insurance programs, once-a-year ordering, and lifecycle costing.

by Staff
June 1, 1996
Giacchi Nets $22.7 Million in Savings for Lorillard’s Fleet

 

6 min to read


Sal Giacchi, director, fleet operations and travel for Lorillard Tobacco Co. in New York, NY, says he feels very fortunate to have gotten hired at Lorillard when he did.

"Lorillard realized the value that a fleet manager could bring to an organization," says Giacchi. "It had $10 to $12 million worth of assets on the road and wanted someone to evaluate the fleet operations, institute programs and cost controls, and manage the fleet."

Ad Loading...

That was in 1981. Today, Giacchi is still with Lorillard, and was just honored with the 11th Annual Professional Fleet Manager of the Year Award presented by Automotive Fleet magazine.

Good Vendor/Supplier Relationships Net $10.5 Million

Giacchi's most successful area of fleet management was in vendor/ supplier relationships, saving Lorillard more than $10.5 million in the past 15 years.

Great partnerships and strategic alliances with manufacturers and vendors is Lorillard's best asset. "A lot of those are long-standing relationships," he says. "Lorillard evaluates several suppliers and leasing companies, but the company has always taken the philosophy that we're not going to move a vendor for a small amount of savings. It has to be substantial, and our vendors know that so they make sure we get the most competitive price possible."

Lorillard holds appreciation lunches for vendors to recognize outstanding performance. Giacchi also felt it was beneficial to sit down with vendors to discuss with them Lorillard's goals and objectives.

Ad Loading...

Safety Awareness Program Saves Lives and Dollars

Giacchi became involved with Lorillard's safety awareness program in 1984. The sales force had just dropped the previous safety program, and Lorillard witnessed a dramatic increase in accidents. At that time, Wheels in Motion was developed, a quarterly safety newsletter that was used to communicate with the sales force on maintenance, used cars, and other issues that could affect driving. Sal Giacchi, director, fleet operations and travel for Lorillard Tobacco Co. in New York, NY, says he feels very fortunate to have gotten hired at Lorillard when he did.

"Lorillard realized the value that a fleet manager could bring to an organization," says Giacchi. "It had $10 to $12 million worth of assets on the road and wanted someone to evaluate the fleet operations, institute programs and cost controls, and manage the fleet.

"That was in 1981. Today, Giacchi is still with Lorillard, and was just honored with the 11th Annual Professional Fleet Manager of the Year Award presented by Automotive Fleet magazine.

Once-a-Year Ordering System Increases Productivity

Ad Loading...

Lorillard has also instituted a once-a-year ordering system to increase productivity.

The fleet department used to place fall orders in August and spring orders in December. The downside to this was that if there was a price increase in January, then Lorillard also incurred that price increase for the spring deliveries.

Giacchi can also put the exact dates on the vehicle orders to meet his cycling parameters. If there are any price increases, he will be price-protected. If the manufacturer decides to delete a special discount package, Lorillard would still be entitled to that package.

In tracking the cost savings of its once-a-year ordering program in 1995, Lorillard saved about $1 million.

Benchmarking and Lifecycle Costing Prove Savings

Ad Loading...

Lorillard found that lifecycle costing helped it evaluate the best vehicle at the best cost for the fleet.

"It also helps you express to management a logical way to look at the total vehicle costs, and not only from what the car is going to cost you," says Giacchi. "In my case, Grand Caravans cost almost $20,000. If that was strictly the criterion I was looking at, we'd probably be in other vehicles that cost less money."

Lorillard benchmarks its fleet costs against other fleets in the tobacco industry. In 1994, Lorillard's maintenance cost was 2.02 cents per mile compared to an average 2.40 cents per mile that was benchmarked against two to three tobacco fleets that are managed or under the administrative programs with GE Capital Fleet Services. The GE Capital Fleet Services' composite was 2.15.

Benchmarking helps Giacchi examine fleet programs and measure performance against industry standards and composites developed by leasing companies and other suppliers. Tracking Lorillard's performance is a way of showing value to management, says Giacchi.

"Today you need it more than ever. Companies are looking at outsourcing and they don't realize the value the fleet manager brings. Benchmarking helps show your value," he says.

Ad Loading...

Associations Helped Round Out Giacchi as a Fleet Manager

Giacchi says he learned the basics of the industry by going to seminars, trade shows, the National Association of Fleet Administrators' (NAFA) chapter meetings, along with other fleet-related events.

"I got tremendous benefits from both NAFA and the Automotive Fleet and Leasing Association (AFLA), by being a leader of both, learning how to make presentations, how to run conferences, meetings, and setting plans for travel and banquets. I never realized that those benefits would come back to me when I got promoted five years ago to travel and meeting planning," Giacchi says.

Giacchi feels that NAFA and AFLA provide training in many areas. "Being able to get up and speak in front of a group of people really helps you when you have to go to a board meeting and make a presentation to management," he says.

Trust of Management Helps Build Success

Ad Loading...

From the day Giacchi started work at Lorillard, his manager said: "I want you to manage the fleet." He gave Giacchi the confidence to be creative. If Giacchi needed to travel, he was provided with the resources to travel. Lorillard gave him additional people when he said the fleet department was understaffed and allowed him to outsource certain administrative fleet responsibilities.

"A lot of companies wouldn't give you that benefit of the doubt," Giacchi says. "The support Lorillard gives me encourages and motivates me to keep looking at areas where I can save them more money and be more cost-efficient. Management has always been on my team, and that's why I attribute my success to them, because they've stood behind me in every decision."

Giacchi Moves Up, Lorillard Moves South

During his acceptance speech for receiving the Automotive Fleet 1996 Professional Fleet Manager of the Year Award, Giacchi announced that he had just been promoted. He will now be the director of corporate support services for Loews Corp. in New York, NY, the parent company of Lorillard Tobacco Co.

Lorillard Tobacco will be moving to Greensboro, NC. in spring 1997, where the company's manufacturing plant is located.

Ad Loading...

Giacchi's replacement has yet to be announced; however, his entire staff will be recognized for their performance and additional responsibilities they will undertake.

"They're a dynamic group of people, probably one of the best in the industry. A lot of my success is because of them," says Giacchi. "Leaving Lorillard is really difficult, but I go to the parent company that has been equally supportive, and I look forward to working with another dynamic group of professionals."

How Giacchi Saved Lorillard $22.7 Million From 1981 to 1996

FLEET AREA

TOTAL AMOUNT

(in millions)

Manufacturer/Supplier Negotiation

$10.5

Financing/Depreciation

$3.0

Operating Expenses

$2.5

Travel & Meetings

$2.2

Resale Above AMR

$1.5

Accident Management/Safety Programs

$1.0

Early Order Protection

$1.0

Insurance Program

$1.0

TOTAL

$22.7


READ MORE ABOUT PREVIOUS WINNERS OF AF'S ANNUAL PROFESSIONAL FLEET MANAGER OF THE YEAR AWARD WINNERS.


Subscribe to Our Newsletter

More Operations

Two employees pull opposite ends of a rope in a tug-of-war, illustrating workplace conflict and the leadership strategies fleet organizations use to improve communication and teamwork.
Operationsby Faith HowellJune 8, 2026

How to Manage Conflict for Your Fleet Operations

Conflict management is becoming a core leadership skill. Here are five strategies fleet leaders should know.

Read More →
wheel geotab image
SponsoredJune 1, 2026

Turning Connected Vehicle Data Into Decisions That Matter

Fleet leaders have more data than ever, but turning that data into clear, actionable decisions remains a challenge. This white paper shows how leading organizations are using connected vehicle data to improve safety, reduce costs, and optimize fleet performance. Learn how to turn insight into action across your fleet.

Read More →
A person holding a clipboard and writing on an inspection checklist beside the wheel of a large white vehicle, likely conducting a fleet or safety inspection.
SponsoredJune 1, 2026

Cameras, Safety and Insurance: From Reactive Claims to Real-time Prevention

Commercial auto remains one of the most challenging and costly lines of coverage for fleet operators and insurers alike. Learn more about how to effectively address these issues from Onur Aksan, Enterprise Business Development Executive, Geotab.

Read More →
Ad Loading...
fleetio coast pay
SponsoredMay 29, 2026

Are You Tracking Your Fleet's True Total Cost of Ownership?

Bobit Business Media surveyed 190 fleet professionals and found that while most fleets are tracking costs, fragmented systems and data gaps are keeping true TCO visibility out of reach. With rising pressure to control spend in an increasingly volatile environment, the gap between what fleets think they know and what the data actually shows is wider than you might expect. See how your peers are managing costs today and where the industry still has room to improve.

Read More →
Promotional graphic for a fleet management whitepaper titled “From Data Overload to Decisive Action: 5 Steps to Drive Smarter Fleet Decisions.” The design features a row of white commercial fleet vans, blue and lime-green branding, and supporting text about using telematics data to improve fleet performance, driver behavior, safety, and operational decision-making. A highlighted quote reads, “The challenge is no longer collecting data. The challenge is using it effectively.” The Utilimarc logo appears at the bottom alongside the website URL.
SponsoredMay 28, 2026

Turn Fleet Data Into Smarter Decisions

Fleet leaders have access to more operational data than ever, but disconnected systems and unclear metrics often slow decision-making instead of improving it. This article outlines five practical steps fleets can take to transform fragmented data into actionable insights that improve planning, safety, utilization, and long-term performance.

Read More →
SponsoredMay 15, 2026

Hybrids: Electrification Without the Challenges

For fleet managers, fuel is one of the biggest line items in the budget — and it's one hybrids can shrink without changing how your people work. Download the eBook to see the numbers, understand the technology, and get a step-by-step guide to making the switch.

Read More →
Ad Loading...
Man speaking during an Automotive Fleet interview beside text reading “The 60% Driver Improvement Nobody Expected!” with blue motion graphics background.
Operationsby Chris BrownMay 14, 2026

How NOV Uses Telematics to Improve Fleet Safety Across 160 Locations

James Victory of NOV discusses how the company manages fleet safety, maintenance, and telematics across more than 150 locations supporting oilfield operations throughout the U.S.

Read More →
A graphic with Ford Pro's Steven Sanstostasi's headshot on it representing the Fleet Meets series.
Operationsby Faith HowellMay 14, 2026

Fleet Meets: Steven Santostasi

This edition of the Fleet Meets series features Steven Santostasi, the current TSP channel manager for Ford Pro.

Read More →
Cover of a whitepaper titled “The Hidden Costs of Departmentally Assigned Vehicles on Your Fleet” featuring a black fleet vehicle driving on a road at sunset. Subheadline reads: “Discover how your fleet can reduce costs and minimize risk by implementing vehicle sharing.” The document focuses on fleet optimization, vehicle sharing, cost reduction, utilization tracking, and risk management for fleet operations.
SponsoredMay 13, 2026

Why Fleet Managers Are Replacing Departmental Vehicles with Shared Motor Pools

Departmentally assigned vehicles often create hidden costs through underutilization, poor visibility, and increased administrative burden. This white paper explores how shared motor pool strategies help fleets reduce costs, improve accountability, and optimize vehicle utilization.

Read More →
Ad Loading...
Three team members in shop with Chris
Operationsby Chris BrownMay 12, 2026

Soap Box Derby Challenge: Assembling the Crew

Meet Gabriel, Matthew, and Angel — the team helping bring this soap box derby build to life.

Read More →