Tech advancements combined with tried-and-tested fleet management practices can radically boost the efficiency of your company cars and vans. Experts explain the latest trends and the savings you could make from them
When it comes to improving company car efficiency, there has never been a period of such unprecedented change. Technological advancements that were the stuff of science fiction just a few years ago are driving this evolution.
From utilising cutting-edge telematics to monitor vehicles’ whereabouts in real time to providing staff with apps that make their working life safer and more straightforward, the opportunities to maximise productivity and save money have never been greater. And that’s before the technological strides being made by vehicle manufacturers are considered.
It’s now possible to travel further using less fuel while emitting lower amounts of carbon dioxide. Gerry Keaney, chief executive of the British Vehicle Rental and Leasing Association (BVRLA), believes that this technological momentum will accelerate for the foreseeable future – but the onus remains on companies operating fleets to get to grips with the immense amount of data that’s increasingly at their fingertips.
“New technology is set to have a massive impact on the fleet sector over the next five to 10 years,” explains Keaney. “Our recent survey of fleet managers and suppliers found that the most important new technologies are ultra-low-emission powertrains, insurance-based telematics and active safety features such as autonomous emergency braking (AEB).
“Respondents were very excited about the potential for these technologies to lower transport costs, reduce accident rates and ensure that vehicles are used more productively. In order to realise this potential, however, [fleet managers] will need to get to grips with the huge amounts of data that their increasingly connected vehicles and drivers will be generating.
“Knowing what information to use, where to find it and how it should be handled will rapidly become a priority for every company.”
Here are 10 tips combining technological advancements with tried-and-tested fleet management practices which many industry insiders believe could hone the efficiency of your fleet…
1.Fully analyse your business travel
It’s only when a company fully understands the volume and nature of work trips undertaken by employees that an informed business travel strategy can be implemented. But how can this best be achieved?
Historically, the starting point for analysing work-related travel was mileage reclaim forms. These show how many journeys are made per month, how far was travelled, how much this cost and whether those trips were undertaken by employees using their own cars – known as grey fleet – or company ones.
While still relevant, technological advancements have resulted in it being easier than ever to track mileage data in real time – and subsequently have it analysed and presented appropriately. Britain’s largest car rental business, Enterprise Rent-A-Car, is among the companies offering fleet customers specialist software to help with this.
“It might be a cliché to say ‘you can’t manage what you can’t measure’, but it’s still true,” explains Adrian Bewley, the company’s director of business rental for UK and Ireland. “We work with customers to provide in-depth analysis of their existing business travel to enable companies to see where costs can be cut and efficiencies made.
“Unless you know where employees travel and for how long, what methods of transport they use to get there and why they’ve travelled in the first place, it’s very hard to know how to improve.
“In-depth analysis can throw up factors you didn’t realise. With one fleet, we found employees using their own cars had a culture of arranging 3pm offsite meetings and not coming back to the office afterwards. By instituting a policy of company car-sharing – where the vehicles had to be returned that day – the business boosted productivity, cut costs and saved jobs.”
2. Consider sharing company cars
Car-sharing schemes, or ‘car clubs’, have the potential to reduce overall fleet costs while improving vehicle utilisation, freeing up parking spaces while also contributing towards sustainability targets.
Basically, they work by providing businesses with a self-service and fully managed car or van pool which is usually located in dedicated parking bays either within a company’s car park or on a nearby street. Those authorised to use the vehicles simply enter a code on the on-car pin pads or swipe a smart key or card over the vehicle’s reader.
The schemes can be particularly useful in helping employers ensure that their duty-of-care obligations are met by making sure that all employees – and particularly grey-fleet drivers – have access to properly maintained vehicles.
Car-sharing scheme providers, such as Hertz 24/7, supply and maintain dedicated car pool fleets for employee use, without the need for companies to invest in the purchase of those vehicles.
Car pool fleets which are supplied and operated by rental companies such as Hertz are frequently equipped with telematics and GPS tracking or speed sensors, with additional services generally including booking mechanisms, insurance, breakdown support and vehicle usage reports.
Mileage and usage are also automatically tracked and logged. Moreover, these fully managed car clubs lead to a reduction in office administration as vehicles can be booked around the clock by employees using an online portal.
3. Scrutinise the ‘whole life’ costs of vehicles
Cars and vans are frequently chosen simply because they have the cheapest upfront price. But closer examination of those vehicles’ long-term running costs – and factoring in all the areas relating to owning and running them – will ensure you get best value in the long run.
Alongside the purchase price or the cost of the monthly lease, it’s important to consider ongoing maintenance, service, repair, depreciation, tax implications and insurance over the duration of ownership, which normally ranges between two and five years. And that’s before fuel costs are counted. It is only by looking at the costs of a vehicle’s whole life that it’s possible to make fully informed decisions.
Elliott Woodhead, director of SME and partnership at leasing company Arval, explains: “Our research shows that very large companies usually consider whole- life costs in order to enjoy the potential for savings, but smaller companies often only look at the initial purchase price or monthly cost.
“Businesses that lease vehicles through leasing companies like us have access to price comparators and calculators that show how ongoing costs can make a huge difference to how much you spend on driving. However, businesses that buy cars outright or use a loan from the bank may not be getting enough access to this information, which means they could be spending far more long term.”
4. Choose ultra-low-emission vehicles
The popularity of ultra-low-emission vehicles (Ulevs) is burgeoning. In the first half of 2015, some 14,586 new plug-in cars were registered
– more than were sold throughout 2014.
But any company seriously considering a fleet of electric cars might want to place an order soon. Earlier this summer, the Office for Low Emission Vehicles (Olev) confirmed that the current version of the Plug-In Car Grant (PICG) for vehicles emitting less than 75g/km CO2 – which equates to a 35 per cent discount off the basic price of an eligible car up to a value of £5,000 – will end this year, at a date yet to be finalised.
Tim Bowden, head of operations at Hitachi Capital Vehicle Solutions, says that companies should consider Ulevs, as well as “all other options”. He explains: “Some traditional fuel models now have emissions comparable to hybrid counterparts, thanks to advanced engine technology and downsizing of engines, and so should still be considered. Engine technology is only part of the answer though. Fleets should always consider how vehicles are used and look to match the optimum solutions with these uses.”
Olev has also announced that it will be reviewing the van grant in the near future, although this will remain at 20 per cent up to £8,000 until further notice.
5. Tune in to the potential of telematics
The arena of telematics has arguably done more to improve the daily management of fleets than any other recent technological innovation. It provides companies with real-time data about specific aspects of their vehicles’ movements. This information is normally gleaned through the installation of technology – akin to a ‘black box’ – within a vehicle which transmits that data to those managing or monitoring fleets.
Its myriad uses include: identifying the location of a driver; confirming the speed they’re driving at; tracking down stolen vehicles; and issuing alerts in the event of an accident or engine malfunction. What’s more, telematics is increasingly being used as a tool to verify speed and location in the event of an insurance claim or legal challenge when the reliability of data is crucial.
Nor does it stop there. RAC’s managing director of telematics, Nick Walker, explains: “The technology can now provide a whole range of additional data that can help with vehicle maintenance, driver management, fuel management, health and safety management, and vehicle scheduling. It can save businesses serious amounts of money too.
“The RAC Telematics ‘driver score’ function can be used by firms to save anywhere up to 15 per cent on annual fuel bills as it allows managers to monitor and influence how efficiently their vehicles are being driven.”
6. Train your drivers
For any company that has experienced a glut of at-fault collisions or eye-watering garage bills linked to excessive wear caused by speeding, driver training could be the answer. It can help staff develop greater hazard awareness and risk-perception skills, which in turn can reduce their vulnerability to accidents or collisions on the road.
This not only protects them from injury, it also helps reduce costs to the business. But – most importantly – the training should meet the specific needs of employees. Driver training can be provided for groups via online courses as well as in ‘classroom’ settings.
Nonetheless, the consensus within the industry is that it’s most effective when delivered on a one-to-one basis with the trainer sat beside the driver at the wheel of the vehicle they use daily. Jenny Powley, sales director of corporate business at RAC Business, says that trainers should first get to grips with the size of a client’s fleet and the precise nature of its work.
She explains: “For example, a delivery firm’s drivers are more likely to be subject to tighter deadlines, so when their training begins this is factored in by the trainer. Drivers need to come away from the course with skills they can realistically use in their day-to-day working world. When a driver is on the road they are representing your business, so it’s important they’re aware of risks to their safety for the security of both themselves and the business they represent.”
7. Maximise the potential of apps
Apps are enabling fleets to slash their administration burdens, increase productivity and simultaneously demonstrate compliance when it comes to duty-of-care legislation. Some of the most useful apps are those allowing work-related mileage to be automatically logged, assisting with expenses claims. But hundreds of others are now available including, for example, those enabling employees to carry out vehicle safety checks instead of using traditional paper forms which then have to be filed.
SEAT is one manufacturer emphasising how apps – in conjunction with telematics – can help fleet clients. SEAT’s head of fleet and business sales, Peter McDonald, says: “Our SEAT DriveApp works alongside our advanced connectivity software, supporting easy vehicle maintenance and better driver behaviour.
“The DriveApp sends condition-based vehicle maintenance alerts to the driver’s smartphone, prompting important checks, which ultimately reduces downtime and damage. It also issues traffic alerts to save time when on the move and offers a ‘Challenger’ feature which ‘gamifies’ eco driving with a series of challenges – an enjoyable way of encouraging a more efficient driving style across the fleet.”
8. Use Advanced Driver Assistance Systems (Adas)
Vehicle technology has developed rapidly over the past decade with new systems bringing significant levels of autonomy and safety to fleet vehicles. Among these developments – known as Advanced Driver Assistance Systems (Adas) – are: Autonomous Emergency Braking (AEB); lane departure warning systems; active cruise control; and automated parking.
According to the Association of British Insurers (ABI), 90 per cent of road traffic accidents are caused by human error. These technological advancements have all been developed to lower this rate. For example, AEB – which automatically applies the brakes if the driver does not respond in time – has been proven to lower the rate of low-speed collisions that result in personal injury claims by around 20 per cent.
For companies operating fleets of cars and vans it just makes sense to maximise the benefits Adas systems bring in terms of reducing collisions – and lowering insurance premiums.
9. Don’t overlook tyre safety
When it comes to clarifying exactly which types and grades of tyre are installed on vehicles, the advice is to ensure that your organisation’s fleet management policy clearly defines protocol. While the law makes it clear that you can’t mix different ‘types’ of tyre – such as radial tyres and cross-ply – it is currently legal to fit tyres of different ‘grades’ across an axle.
For the past three years, European legislation has required every new tyre to be graded with a rating from A to G for grip in the wet and fuel efficiency. Each tyre is also given a value measured in decibels for the amount of noise they produce. Safety professionals advise that fleet management policies are regularly updated to state precisely which type and grade of tyre should be fitted to each make and model of company vehicle. Automotive software company Epyx has recently launched a new e-commerce service called Tyreserve to make tyre changes even more straightforward for fleet customers. When fully operational, the service will enable companies to book their vehicles into their nearest franchise dealer for a tyre change – which hasn’t always previously been possible.
10. Go further with fuel cards
Fuel cards improve efficiency in three key areas: by reducing the administrative burden; by bringing about cost savings; and by providing access to accurate management information. They work by providing designated company vehicle drivers with a secure and streamlined method of paying for fuel. Apart from dispensing with expenses claims, different cards also enable those at the helm of businesses to control where fuel is bought, potentially delivering cost savings across a fleet, particularly as certain fuel card products can offer prices cheaper than at the pump.
Natalie Mottershead, assistant manager (product) at Lex Autolease, is unequivocal about the benefits of fuel cards. She explains: “Fuel cards help reduce administration costs by removing the need to gather receipts from multiple drivers and improve efficiency by freeing up managers whose time could be better spent on analysing management information and spending patterns.
“In addition, cashflow within a business is improved through a more streamlined and regular invoices and payments system, and an automated fuel card system mitigates the possibility of abuse from drivers exaggerating their expense or mileage claims.
“Fixed-price fuel can be negotiated subject to volume, and cost savings can be noticed almost immediately. Furthermore, fuel cards have enormous advantages when it comes to providing another source of data about a fleet’s drivers, as they capture transactional data automatically and allow customers to monitor and track fuel spend as well as vehicle mileages.”
To find out more about the vehicle rental and leasing sector, visit bvrla.co.uk