Vehicle Fleet Right Sizing
Fleet rightsizing is the practice of ensuring that company vehicles are all effectively filling the roles they were brought into a business to help serve, and making any adjustments to the scope of the fleet as necessary to make the company more operationally efficient.
Why Fleets Should Right Size
Rightsizing is an important business function that some fleet managers might place behind more immediate areas that impact a company – such as driver safety, vehicle maintenance or fuel spend – but is a critical function that should be regularly reviewed and analyzed, especially since ineffective rightsizing can impact these other aspects of the company.
According to the U.S Department of Energy, “fleet inventories often grow over time to include vehicles that are highly specialized, rarely used, or unsuitable for current applications. By evaluating fleet size and composition, managers can optimize vehicle use, conserve fuel, reduce emissions, and save money on fuel and maintenance.”1
Items to Consider When Right Sizing
To properly right size a fleet, managers must have a solid understanding of how their vehicles are servicing the key functions of their business. Is your fleet doing too much with too little, or vice versa?
Some essential items fleets should consider when looking to rightsize the fleet, according to the U.S. DOE, include:
- The tasks/goals of the vehicles
- The mileage of the vehicles
- Vehicle fuel consumption
- The type of vehicles being used
- The age of the vehicles
“A fleet rightsizing strategy should evaluate the business case of each vehicle to determine whether reassigning, replacing, or eliminating the vehicle would reduce fuel and maintenance costs without compromising fleet activities,” according to the U.S. DOE. “Fleet managers often need to define evaluation criteria and rank vehicles to complete this analysis.”
Fleets should regularly review their fleet overall, talk with drivers about the vehicles they are operating, and review more specific and granular telematics data and other fleet analytics if this is available to them.
Guiding Right Sizing with Fleet Telematics Data
Expanding or reducing the size of a fleet, for example, to improve business efficiency should be based on objective and data-driven information. This is where telematics can help.
“When you implement a telematics solution, you might find you have some inefficiencies in places, your productivity is lacking, and you find out you don’t need to make a big capital investment in another vehicle and another employee because if we streamline operations better with the tools telematics gives us, you can do more with less,” said Jeff Alsop, GPS Trackit, director of strategic accounts.
Right Sizing to Improve Business
However, if expanding the size of the fleet is necessary for business growth, telematics can act as a sort of safety net by providing the company with detailed information that might otherwise not be so visible when right sizing.
“It gives you more transparency and more peace of mind in growing your business,” said Alsop. “Companies may be more comfortable in growing and expanding their business, maybe even doing mergers and acquisitions to grow their market share because they have a tool in place that provides more visibility of their fleet.”
This can help fleets make important decisions on rightsizing, including transitioning to smaller, more efficient engines; introducing lighter vehicles, and using alternative fuels and vehicles, according to the U.S. DOE.
Green Fleet Initiatives
Depending on the business, fleet rightsizing may also be aimed at achieving specific corporate initiatives such as adopting more alternative fuel vehicles, including hybrid and electric vehicles.
For example, more than 100 companies have already made a commitment to the Climate Group’s EV100 global initiative, in which they’ve dedicated their businesses to switch their fleets to EVs and/or install charging for staff and/or customers by 2030.2
However, implementing alt-fuel vehicles is easier said than done. The biotechnology company Genetech – a member of the EV100 – started off their greening efforts by incorporating hybrid vehicles into their operations to get drivers comfortable with new types of fuel. The company has subsequently introduced more EVs into their operations. 3
Educating drivers on using these new vehicle types is also an important component to implementing the vehicles in a fleet, particularly with EVs.
If you’d like to learn more about how GPS Trackit can help to improve safety, increase productivity and reduce costs for your business, speak with one of our knowledgeable Fleet Advisors at 866-320-5810 or get a quick Custom Quote.
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