One of your company’s largest cost centers is no doubt your fleet. But within that fleet are a variety of opportunities for cost savings. Here are 3 ways to find savings in your fleet.
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Do more with the vehicles you have
One of the largest and most obvious costs for fleets is the vehicles themselves. Estimated total cost of ownership for a light-duty vehicle runs between $5,000 and $8,000 per vehicle, per year. The larger your fleet, the greater the cost of ownership. For this reason, many companies are looking to reduce the size of their fleets. Removing just 10 light-duty vehicles can save upwards of $80,000 annually. Right-sizing your fleet — making sure you only have the vehicles you really need to get the job done — can result in significant costs savings for your operation.
The estimated total cost of ownership for a light-duty vehicle runs between $5,000 and $8,000 per vehicle, per year.
The challenge is knowing how many vehicles you can safely eliminate from your fleet while maximizing the utilization of the remaining vehicles. Remove too many vehicles, and you may fall short of customer demands. That’s where having the right telematics system in place becomes crucial.
Look for a system that allows you to see exactly how many vehicles you need to maintain your service level agreements and customer satisfaction. The system should help you identify vehicles that are underutilized. Then you can either redirect them to customers with higher demand, or eliminate them from your fleet altogether.
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More cost-effective maintenance
Maintaining vehicles costs money. But while preventative maintenance may be a significant expense for most businesses, it’s also a prime opportunity to reduce costs. Proper tire inflation, maintenance and alignment, for example, can lower fuel consumption as well as extend tire life. The same goes for proper servicing of filters, fluid levels, hoses, lines, belts and wiring. The key is to perform these maintenance tasks on the right vehicle, at the right time.
Your telematics system should automate the maintenance process and help you prioritize vehicle repairs based on active diagnostic faults and other in-depth engine-derived information.
With an effective telematics system in place, your company can stop engine issues before they turn into costly repairs, vehicle downtime, and even before you see the engine fault codes. The simplest vehicle repairs can be very costly to your bottom line. They can also multiply quickly with each vehicle you have on the road. You can enter maintenance schedules into your telematics system and get alerts when regular maintenance is due so you minimize vehicle downtime.
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Safer driving means more savings
Driver performance programs help save fuel costs and reduce vehicle wear and tear. But they can also have significant impact on another major cost center for fleets: accidents. Fleet-operating companies spend hundreds of thousands of dollars each year on vehicle damage, repairs and downtime because of accidents. When injury is involved, accident-related costs can soar to millions of dollars in liability claims.
A telematics system with an effective driver performance program can go a long way toward improving driver safety. In the process, it can also decrease speeding tickets, lower insurance premiums, and reduce accidents that could potentially cost you millions. Look for a driver performance program that gives you the visibility you need to motivate, empower and incentivize drivers to self-manage risky behaviors such as speeding, cornering, hard braking and hard accelerating.
When injury is involved, accident-related costs can soar to millions of dollars in liability claims.
While equipping your drivers with the tools to modify their own behaviors, your driver performance program should also allow your fleet managers to monitor drivers’ performance across a range of behaviors and identify added opportunities for improvement.
Want more ways to find savings in your fleet? Download our free report, Find the Savings in Your Fleet now for additional ideas. Or visit the Fleet Cost Savings Resource Center for more ideas.