The Agile Fleet

Insights, ideas, & expertise for optimal fleet management

Feeling good because your motor pool meets 100% of vehicle demand?  Why this may not be a good thing.

Posted by The Agile Fleet on August 08, 2017

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If you are able to accommodate 100% of requests for motor pool vehicles 100% of the time, that could be a luxury that’s chewing up your bottom line. While fleet managers certainly don’t want to have to turn down requests of their internal customers, if the shared fleet can meet every request all of the time, then it is likely the fleet is too large and needs to be reduced. On the flip side, if your requests far exceed your ability to fill them (and here a benchmark may be useful), then you may have too few vehicles in a location. One of the most under-valued utilization metric is the number of reservations turned down or diverted to an outside rental agency.

Remember, the goal of a right sized motor pool is simple: it is to have the right number of vehicles – and the right type of vehicles – at the right locations where they are needed.

What can you do? Consider other options you could use to fulfill the requests you have to turn away. Could outside rentals or reimbursed personal vehicle use be options to handle periodic shortfalls? Your FMIS should be able to easily show you how often you turn drivers away because you did not have a vehicle. Or, you should know how often you had to rely on an outside rental company to fulfill your needs. It’s a pretty straightforward math problem to figure out where the break-even point is relative to using outside rentals or acquiring a vehicle for the fleet.

If you determine that you have too few vehicles, use historical data—from an entire cycle—to justify the request for more vehicles. If you’ve had to regularly turn away two people who wanted sedans every week over the past several weeks, this is a trend. Now, you can concretely show that adding a vehicle would cost less than the money you’ve paid in personal use expenses over the past several months. You’ll be able to make a compelling, fact-based case to add a vehicle. Properly analyzing data will allow you to determine if you need to remove vehicles, reallocate assets, or even add vehicles.

Want to learn more about vehicle utilization? Download our new e-guide that covers how to understand your data and cut motor pool costs.

SHOW ME THE DATA: UTILIZATION METRICS DOWNLOAD OUR E-BOOK

Topics: Utilization, Right-sizing, Fleet Management Technology

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