Tag Search Result

Replacement Cycles

The ongoing semiconductor shortages, with the resultant delays on new vehicles, is impacting fleet replacement cycles. As a result, many fleets are now facing lifecycle extensions as shortage of replacement vehicles becomes a pressing issue, which in turn places a premium on Service, Maintenance and Repair (SMR) schedules.

Read more

Shortcycling Re-emerges to Leverage the Strong Used-Vehicle Market

Today’s used-vehicle market is the best it’s been in the history of fleet management and my anecdotal forecast is for it to remain strong through the balance of 2021 and into calendar-year 2022. As a result of these favorable market conditions, some fleets have begun shortcycling some of fleet vehicles.

Extended Cycling Doesn’t Achieve the Intended Goal

Extending replacement parameters is often counterproductive to the intended goal. Longer service lives increases unscheduled maintenance with longer downtime and increases the number of units operating outside of warranty.

What's Impacting Truck Replacement?

Big Data, tax law changes, new vehicle options, fuel prices, and more, are impacting fleets decisions about when to replace their trucks.

TCO Is Not a Static Number

A vehicle’s total cost of ownership is comprised of its fixed costs, operating expenses, and depreciation per year or during the course of its service life, minus its anticipated resale value. During the course of a vehicle’s service life, TCO is subject to change due to a vehicle’s age and numerous external factors, which has a direct bearing on replacement policies.

Overt & Hidden Costs of Extending Truck Replacement

Extending truck replacement cycling parameters beyond stated fleet policy is typically a short-term tactic used by senior management to solve a budgetary constraint; however, there are long-term fleet consequences to this strategy.

Long-Term Impact of Longer Truck Replacement Cycles

The more expensive the asset, the longer it is kept in service; however, the need for short-term cost savings prompts some fleets to even further extend cycling parameters and defer replacements. But, what are the consequences?

Vehicle Depreciation Remains Steady

Vehicle depreciation is impacted by a number of factors, from supply and demand to overall economic conditions. While 2015 was relatively stable for depreciation, some challenges are on the road ahead.

a Bobit media brand

Create your free Bobit Connect account to bookmark content.

The secure and easy all-access connection to your content.
Bookmarked content can then be accessed anytime on all of your logged in devices!

Create Account