Insights

Over the decades we have amassed a library of resources, both internal and external, which help our team and our partners do their jobs with skill and confidence. Peruse these pages for current trends and thought leadership, our newsletters, and tips that we have found helpful over the years. And if you have any questions for us, we’re always here for you.

Fleet Fuel Spending: An Overview

The cost of fuel is something we’ll always have to deal with. While the demand for fuel has increased over the years actual fuel production has remained relatively constant leading to higher and higher fuel prices. Although keeping a fleet on the road will always demand some fuel costs, there are many ways cut this cost down by building a more efficient fleet. Efficient

Forward thinking fleet managers are meeting these challenges head on with best practices and smart fleet management strategies. They know that building the right fleet, ensuring your vehicles are maintained and replaced appropriately, and monitoring fuel costs are all ways to save your company money.

Fleet Asset Management

Asset management is just what it sounds like: managing the assets your business requires. In this case it’s your fleet of vehicles. One of the most effective ways to cut your fuel costs is to make sure your vehicles are operating as efficiently as possible. Below is a look at how everything, from individual vehicles to your fleet layout as a whole, can impact your fuel costs.

Smart Vehicle Selection

Vehicle selection is a simple concept: select the proper vehicle for the job. However, it’s much more difficult in practice. There is a lot of information to consider when purchasing the best vehicle for your business needs. An abbreviated list includes: weight, engine specifications, engine torque and power, drive ratios, number of axles, transmission, and aerodynamics.

Considering Cargo

Weight, distribution and type of cargo can all affect fuel efficiency as well. When choosing the proper vehicle for a job you’ll want to take weight into consideration. Does the job require long distance driving for a single person? A small, lightweight car would have much better fuel efficiency than a truck or SUV. However, if the vehicle is headed to a construction site where tools and supplies may be hauiled, an extra 100 pounds can decrease a small vehicle’s MPG by 2%. This extra weight would have less of an effect on a larger vehicle equipped for this kind of cargo. Forcing a vehicle to perform a job it is poorly suited for is a sure way to raise fuel spending.

Although lighter vehicles tend to be more fuel efficient, it’s important to remember that it’s better to buy the best vehicle for your specific business objectives, than to buy a cheaper or lighter vehicle that doesn’t fully suit your needs. Just remember that selecting a vehicle with too much or too little power, or one that is too heavy or too light, can actually lead to inefficiencies in fuel economy.  

Careful Route Planning

The routes your vehicles take can have a major effect on fuel economy. Routes should be planned to avoid traffic, to keep vehicles off terrain that decreases fuel economy, and to limit starting and stopping conditions.

These variables are easier to change if your fleet has a regular route, but any fleet can benefit from route planning. So what’s the best way to plan your route? Different business will have different solutions, but we recommend route tracking software for complicated or changing routes.

Fleet Replacement Cycle

Many companies have replacement cycles that are sporadic (purchasing new vehicles only when there is a pressing need) or too long (waiting until the vehicle has passed it optimum resale period). Replacement cycles that are too long lose out on the potential resale value of the vehicle while costing your company money in maintenance and lower fuel economy. 

Other companies have chosen to extend their fleet replacement cycles. This is often a short term solution to reduce the company’s budget, but it has long term consequences. Although different companies will have different replacement cycles based on fleet utilization, extending your fleet replacement cycle can lead to depreciation costs because of uncertainty in resale markets, unscheduled maintenance, and extended periods of downtime.

If you are considering extending your replacement cycle because of budget concerns, a fleet renewal plan prepared by a fleet management company can present funding alternatives and strategies for a new, more fuel efficient fleet. Not only does this mean more capital in the long run from strategic resale, it also leads to better gas mileage, less pollution, and less employee downtime

Bonus: Fleet Sizing

Gas_PumpAlthough it may not directly impact fuel spending, one final aspect of asset management is fleet sizing. Because of an ineffective replacement program, insufficient funds for new vehicles or general inattention to fleet size, some companies have an excess of vehicles.

If you have extraneous vehicles, they’re costing you in maintenance and insurance. Keeping only the vehicles that are used for regular operating needs can save you a substantial amount of money. Remember, you can always rent vehicles if unusual circumstances arise or you need specialized vehicles for a short period of time, so there’s really no reason to keep “spares.”

Partnering with a fleet management company that can offer flexible-term rental solutions can be beneficial for maintaining the optimal fleet size, adding to your fleet in the short term, and planning for future fleet growth.

Driver Behavior 

Driver behavior is the number one factor in fuel efficiency, so, even though it might not be the first thing many people think about when it comes to fuel costs, it’s worth paying attention to. Driver behavior includes: 

  • Speeding
  • Acceleration and deceleration
  • Driver awareness
  • Tire pressure
  • Route planning
  • Idling time

Because of the huge impact driver behavior has on fuel efficiency, it’s worth investing in driver education that focuses on efficiency and supporting incentives for efficient driving. If you’re looking for a more indepth look at driver behavior and how it can affect fuel efficiency, check out our blog post 6 Ways Drivers Can Achieve Greater Fuel Economy.

Fuel Cards & Data Management

A fuel card is a powerful tool. Not only does it establish a universal way for your drivers to refuel their cars while on the road it also establishes: 

  • Control of Costs
  • Web-based Reporting
  • User Accountability
  • Security

Cards can be assigned to specific vehicles, individual drivers or even multiple drivers. They can’t be used by other parties or for non-approved vehicles. They can highlight drivers and vehicles using excessive fuel and also eliminate fraud. You can even control precisely what can be purchased. For example, specify gas only or gas and other expenses. 

This is just a brief overview of strategies to monitor and cut your fuel spending. If you’re looking for more information or help managing your fleet consider a fleet management company. They’ll be your dedicated team, equipped with the expertise, resources and information to help you make the best fleet management decisions.

 

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