3 ways to cut costs on your Light Commercial Vehicle Fleet
Keeping your commercial vehicle fleet up and running is one of your major spends – probably only just behind salaries and premises. So, of course, the spotlight is permanently on LCV fleet costs. Vehicle purchase price and estimated maintenance costs are usually the decision drivers. However, at LeasePlan we recently found that companies might be missing out on some significant cost saving opportunities by focusing primarily on such costs.
What happens when you look beyond purchasing and maintenance costs to operational costs? How are they influencing the TCO of your commercial vehicle fleet? We found that companies which give due attention to operational aspects, have managed to achieve significant cost reductions and, along the way, have increased driver satisfaction as an indirect, additional benefit.
Here are the three key operational areas that we identified for effectively cutting the costs of your LCV fleet:
1 – Cut back fuel consumption
With fuel up in the Top 3 of biggest fleet spend (ranking second after purchase price), there are significant savings to be made by keeping your drivers’ foot off the throttle. Just one extra mile per gallon, on an average van, will save £75 per year. Companies that are successfully cutting back on fuel consumption appear to be those that encourage and reward good driver behaviour. But that’s not all: that bit of extra driving attention, also results in many indirect savings through safer driving.
Reward fuel-efficient driving by, for instance, creating a league table with a prize at the end of each quarter. Of course, vehicle – telematics can be of great support in managing fuel analysis, but some simple pointers for drivers will help them achieve even better results. Here’s such a short driver checklist to help cut fleet fuel consumption:
• Ensure tyre pressures are correct.
• Unload unnecessary equipment to reduce the weight being carried in the vehicle.
• Remove ladders and roof racks when not required.
• Ensure the vehicle is serviced on time and correctly.
• Use journey planning software to minimise traffic delays.
2 – Reduce vehicle downtime
Vehicle downtime is the biggest cost during the life of a commercial vehicle. But, downtime is also a ‘hidden’ cost. It’s the cost of having a vehicle unavailable because it’s in for repair, servicing or accident damage. And, in fact, such costs can start to spiral with each hour that the vehicle is not available.
Here also, we see that companies that actively stimulate driver buy-in are the most successful at reducing vehicle downtime and, by extension, keeping their fleet costs under control.
• Allow the driver time in his/her working day to carry out essential daily checks.
• Give drivers clear and easy processes that they can follow in the event of an accident, vehicle breakdown or tyre replacement.
• Put driver incentives in place for: proper vehicle care, checks, timely service, minimal end-of-contract damage and the proper and prompt reporting of accidents.
3 – Drive down damages
Unfortunately, accidents are a fact of life. Although effective accident management can ensure that your vehicles are back on the road as quickly as possible, actually cutting back the number of accidents is the most sure-fire way of driving down costs. Looking into accident data and identifying possible trends could help you take measures to reduce the number of incidents.
For instance, you could check whether the same type of accidents are occurring in terms of damage, specific items needing repair, the same drivers, particular environments, times or locations. Based on your findings, improve driving behaviour through driver training for your ‘less careful’ drivers, or placing in-car cameras or sensors to help drivers while reversing. But, even some more indirect options, such as hands free, voice control and text-to-speech Bluetooth connectivity, or cameras to record driving behaviour could be of great value (at minimal cost) to cut down on accidents.
Double your benefits
Of course, purchase price remains all-important in calculating your TCO. But, investing in creating driver buy-in is paying off for many companies. Not only have these companies achieved major cost reductions, but, as important spin off, they have enthused drivers and improved employee satisfaction.
Steve Crawshaw is a Fleet Consultant in the Commercial Vehicle department at LeasePlan UK.
International LeasePlan LCV Event
On 9th March 2016 LeasePlan will host the second International LCV Event in the Netherlands. Through an interactive programme the event will provide attendees with insight and expertise into 3 key areas of successfully managing a commercial fleet namely, how to get an LCV fleet on the road, how to keep it on the road and finally how to take it off the road.
Additionally, there will be an LCV FAIR where attendees can meet with LCV manufacturers and fitters as well as test drive vehicles.
For more information and details on how to register please visit www.leaseplan-international.com/content/international-lcv-event.