GE Capital Fleet Services has identified $420 million in potential cost savings for customers in 2014, with customers realizing $210 million in actual savings as a result.
By working with fleet customers and analyzing data via its Strategic Consulting Services group, GE Capital Fleet Services has identified $1.6 billion potential savings opportunities for customers since 2011, the company says.
Last year customers realized 50 percent of all identified cost savings, an increase of 7 percentage points from 2013. The largest areas of cost savings identified by GE Capital Fleet Services during 2014 were:
- Replacement Analysis: Determining the optimal time to cycle vehicles and/or utilizing a short-cycle replacement strategy to decrease vehicle depreciation and capitalize on higher value at auction.
- Program Enhancements: Properly managing time and expenses including maintenance, fuel, accident and safety costs, telematics, licensing and registration fees, and toll and violation expenses.
- Vehicle Selection: Evaluating fleet vehicle usage requirements to maintain a fleet that maximizes fuel cost savings and minimizes maintenance costs while deploying vehicles that optimally meet driver needs.
- Lease Versus Purchase: Determining whether leasing or owning vehicles is the most cost efficient way to manage a specific company’s fleet.
- Lease Versus Reimbursement: Identifying cost-cutting opportunities through conversion of companies’ driver reimbursement programs into company vehicle programs.
In addition, GE Capital recently conducted a study of 409 middle-market businesses with fleet operations that uncovered trends in how fleets plan to increase productivity in 2015. Top areas of focus included:
- Refining a preventative maintenance strategy to maximize uptime.
- Specifying the right vehicle for the job/properly upfitting existing vehicles.
- Defining a comprehensive vehicle replacement/cycling plan.
- Optimizing routes and maximizing time spent at revenue generating locations.
UPS also expects to increase fleet productivity via its On-Road Integrated Optimization Navigation (ORION) routing system. The company says ORION will reduce by 100 million miles annually the distance driven by its drivers, when fully implemented in 2016, saving 10 million gallons of fuel annually and more than $300 million.