Why are fleet operating and maintenance costs rising?
There are many factors which affect fleet operating and maintenance costs and which are causing a rise in overall costs.
In Vehicle Technology – There is an increasing amount of technology in vehicles. So not only can this make vehicles more expensive to purchase or lease in the first place, it also increases maintenance and repair costs if something does go wrong.
Business Fleet Taxes – when operating a fleet there are many taxes to keep in mind in overall costs.Including Vehicle Excise Duty (VED), benefit in kind and national insurance contributions. And with a clamp down on emissions, those who operate fleets could be seeing increases as the government push electric vehicles.
Insurance costs – fleet insurance costs are affected by a range of factors, But the increasing technology in vehicles is also having an impact here as it is resulting in rising claims costs which need to be covered by providers. Anthony Jones Director Steve Green discussed his thoughts on the impact of vehicle repair costs on fleet insurance in one of our recent blogs.
Fuel costs – fuel is a significant cost when it comes to operating a fleet. And it is not always a predictable cost. Price changes at the pumps can result in a rise in fleet operating costs.
How can fleet managers bring down costs associated with running a fleet?
Safely controlling the running costs of a fleet will be one of the major roles that a fleet manager is tasked with. Here we look at some ways in which fleet managers can look to drive efficiencies:
Choose your vehicles carefully – as we discussed above those with higher emissions attract higher tax and will most likely continue to do so. So, keep this in mind when choosing vehicles for your fleet. There are currently many tax reductions and incentives for electric vehicles, so now could be the time to switch if any of your vehicles do need replacing. The sale of new petrol, diesel and hybrid vehicles will be banned by 2035 under current government plans anyway so the switch over will become inevitable.
Keep your vehicles on the road – with a well-defined vehicle maintenance strategy you can keep vehicles on the road and reduce overheads associated with vehicle down time
Use data created by your telematics system – telematics systems can help you identify training needs, identify ways in which to bring fuel consumption down and identify driver behaviours which may be associated with increased or accelerated vehicle wear and tear.
Make use of fuel cards – those which offer discounts on fuel can be worth making use of across your fleet. They can be a straightforward way to minimise fuel costs.
How important is vehicle maintenance in running a more efficient fleet?
Vehicle maintenance is one of the most important factors when it comes to running a more efficient fleet.
Well maintained vehicles are less likely to break down or be off the road. This means vehicles remain on the road, allowing your workers to do the job they need to do.
Having a vehicle off the road results in repair costs, lost hours and productivity which results in lost revenue to your business. Therefore, increasing the costs associated with running a fleet.
In the long run, spending money on continuous, low level maintenance is also likely to help you avoid any larger, high cost repairs which could occur due to neglect of the vehicle.
Take a look at this article which covers case studies of different maintenance management strategies for an idea of how other fleets manage their maintenance costs.
As a fleet manager, not only is vehicle maintenance important to the efficient running of your fleet. Carrying out regular maintenance ensures that you comply with your duty of care to your employees. You must ensure the well-being of your employees. And one way to do this is to ensure that the vehicles that they driver are safe.
Anthony Jones specialise in Fleet Insurance. We work with a wide range of insurers so are well placed to get you not only the right insurance for your business, but insurance that offers value for money. We can also advise on areas such as risk management and strategy – areas which can really help you drive efficiencies and cost savings. Chat to us today for more information.