How can you maintain your vehicle fleet on a budget? Competition drives prices downward, chipping away at revenue. Fuel prices have risen since 2002, causing companies to spend more overhead dollars to stay in operation. The 2008 crash didn’t help any businesses to generate more revenue, and Uber has begun to disrupt the taxi industry across the globe.
Despite all of that, keeping your vehicles functional is the most affordable long-term plan. But how do you clean, maintain, repair, and fix an entire fleet without breaking the bank?
You need to apply economics of scale to your fleet, taking advantage of its sheer size to drive down the cost of maintenance for each vehicle. That’s how every big business becomes big—each one finds a way to add more value with every action it takes. Manufacturers scale costs with mass production, technology companies scale with widely distributed software, and agencies scale by applying specialist knowledge in service packages.
Most fleets can’t do this effectively because they specialize in something other than auto repair. Taxi fleets specialize in transporting civilians, while supply chain fleets specialize in transporting commercial goods. The biggest auto manufacturers dedicate entire facilities toward performing one function, which is how they drive down the price of producing each part of every car. Your business will never reach those levels of savings unless it specializes in fleet maintenance and repair.
And you can’t focus on maintenance while you specialize in something else. With that in mind, the most cost-effective option is to find experts who leverage economics of scale to provide full-service maintenance for your fleet.
Life Cycle Costing Will Maintain Fleets on a Budget For You
Many business stakeholders cringe at the thought of paying more than the bare minimum on maintenance and repairs. Publicly traded companies tend to operate this way, and the ones that do also fail because the behaviour simply isn’t sustainable.
Scaling your fleet maintenance means getting away from that fear of one-off costs and thinking in terms of life cycle costs. There is a direct correlation between a vehicle’s lifespan and the care that goes into it, and that means every vehicle’s cost decreases for every month you prolong its life. You can ignore automotive upkeep for months and pay hefty prices for new vehicle parts up-front—but investing a small amount of funds every so often to prevent degradation and breakage keeps your cars working for longer. Longer life spans mean affordable vehicles, plan and simple.
Don’t approach each repair or check-up as a bare-minimum patch job. No car survives the long haul with that approach. Incidentally, outsourcing is one of the best ways to leverage scale: certified automotive centres are able to offer lower prices because they dedicate entire business models toward maintaining fleets on a budget, whereas it’s just a necessary cost appended to your fleet’s main business if you tackle this problem in-house.
Investing in the smaller cost of routine maintenance to keep everything in good shape because it leverages time as your ally. Making the expensive parts last longer works out to be far more economical than neglecting to maintain them. Since a new engine can cost anywhere from $5,000 to $15,000 on its own, it makes absolute sense to get as much mileage out of it as possible! That doesn’t include axels, tires, brakes, or air conditioning units, either.
How Often Can You Maintain Fleets on a Budget?
How often should you service your vehicle? Once per month is recommended, especially for fleets with any of these characteristics:
- Low-speed driving in the city
- Frequent idling
- Towing other vehicles
- Around-the-clock vehicle use (to scale time)
Constant fleet maintenance also minimizes vehicle downtime, making it a much better value trade-off than skimping on upkeep. Steady trickles of maintenance funds keeps your fleet on the road for longer, which means you make more money. Downtime doesn’t just cost money for the mechanic’s time; it costs you every minute the vehicle isn’t out there generating revenue for you.
That’s why you also need to consider downtime as well as price. If an auto centre can get your vehicle up and running faster for a slightly higher price, you will end up making more money by increasing your vehicle’s availability. Sit down with your fleet servicer to figure out how to strike the best balance between price and time.
How to Save Money on Fuel:
Start with vehicles that get a higher MPG (miles per gallon). Consider this: the Oregon State Fleet saved $700,000 USD per year by gaining an additional two miles per gallon on average. That’s $175 in fuel savings per vehicle every year across a fleet of 4,000 vehicles, and it really adds up.
Utilizing the fuel savings of electric vehicles is increasingly becoming one of the best ways to maintain fleets on a budget. If that’s just not an option, then consult with your fleet servicer to find out which models will net the best mileage for your needs. But never pass up an opportunity to incorporate better fuel efficiency into your fleet.
How do You Monitor Vehicles on a Budget?
Drivers manually filling out reports used to be the norm, but many fleets are now moving to automated electronic systems. Professional drivers know more about cars than most people…
But they’re still not mechanics by trade, let alone certified technicians.
Drivers won’t always know how to identify certain problems, much less catch them before they grow into larger issues. Even when they do, there’s still room for human error in the best manual assessments. Technology isn’t perfect either, of course, but catching problems while they’re small—and dealing with a few false alarms in digital reporting—is well worth the price for most fleets.
Electronic fleet monitoring will become a necessity if you want to maintain fleets on a budget in the future. It has become more prevalent with electric vehicles (EVs for short), as management teams wants to understand how to get the most value per dollar spent on energy sources. EVs are starting to infiltrate the market in a big way:
Google is developing electric autonomous cars, and Uber wants to buy them too.
This has already spawned companies that specialize in managing fleets of electric vehicles, and the industry is only going to grow as EVs take up a bigger market share in the future. Some even specialize in servicing fleets transitioning from traditional vehicles to electric ones, so do not shy away from fleet monitoring just because it might seem like a hassle at first. Don’t dismiss adopting EVs either, for that matter—you can accommodate both types of vehicles with one monitoring system.
You don’t need to break the bank to maintain fleets on a budget, but you do need to invest in them periodically in order to get the biggest return on your investment. Find out how to get the best deal by leveraging priority scheduling and service record storage. End-to-end service is the key to saving money in the long run—feel free to consult us on how to save the dollars you earn for profit instead of just replacement.