Tag: Management

Several years ago, when gas prices were higher and an industry need arose to reduce costs and seek alternative solutions, conversations about harnessing the sun intensified. Combined with advances in electric vehicle technology, the possibilities of what manufacturers and fleets could do in this realm began to grow.

Solar power began to be used to extend the range of some electric and plug-in hybrid electric vehicles. And a full-size electric pickup truck using solar to extend its range was introduced at the 2014 North American International Auto Show.

Given the evolution of solar power use in vehicles over the years, where are we today?

As it turns out, on a slightly different course than one may have assumed. Rather than focus on the use of solar to add range to electric vehicles, utility fleets are, for example, adding panels as components of larger energy management systems. Solar power may be used to recharge vehicle starting and auxiliary batteries. It also can supplement battery charging while a vehicle is being driven or while it’s stopped – a valuable feature where legislation may prohibit idling. Additionally, solar power paired with an inverter system converts DC battery power to AC household power to charge cordless tools, laptops, test equipment and other work truck loads that require AC power without draining the battery.

“It’s a very clean and silent way to create AC power without using a generator,” said Sean O’Connor, sales channel manager of Go Power! (www.gpelectric.com). His company, based in Victoria, British Columbia, has been in the industry since 2000, originally starting with solar and inverter systems for RVs. Go Power! introduced its panels and power inverters to the work truck market five years ago when the company recognized a need to greatly reduce battery replacement within fleets. Minimizing the frequent battery replacements typical among fleets can bring a fast return on investment.

Even on cloudy days, a solar panel still can generate power. Panels range from about 30 watts to 100-plus watts; regardless of the power produced, a solar power system can use a solar controller, which acts like a fuel shutoff valve, to protect the battery from overcharging and prolong battery life.

Mike Stephens, Go Power! division manager, said every fleet has a slightly different niche and need. The right combination might include an inverter only, or a solar panel for trickle charging, or solar panels and an inverter. Systems can be uniquely designed to meet a fleet’s requirements.

Harnessing Practicality
With regard to using solar power, there are some things that still aren’t completely practical – yet. But Dave Meisel, senior director of transportation and aviation services at Pacific Gas and Electric Co., has seen solar’s practical applications. His fleet employs an electric power takeoff (ePTO) system that uses a series of batteries to power onboard equipment at job sites, and truck-mounted solar panels have been used to charge those ePTO batteries.

Altogether, the system has helped increase productivity by extending the number of hours employees can work in noise-restricted areas because power no longer has to be supplied by a noisy generator. There also have been increases in safety because workers can now communicate by talking rather than having to use hand signals over the sound of that generator, and bucket truck operators – who traditionally sit in the back near the exhaust – have greatly benefited from reduced emissions on the ground. Meisel partnered with Altec (www.altec.com) to electrify PG&E’s worksites through the company’s Jobsite Energy Management System (JEMS), “and solar has been a part of that,” said Meisel, whose California-based fleet of roughly 15,000 assets has one of cleanest power generation mixes in the nation. “Electrifying the worksite has been a huge win for us.”

The way Meisel sees it, the biggest thing to remember about electrification is that the technology is still in its infancy. Its potential – and the full potential of solar power – remains to be seen.

“I don’t know that we’ve fully understood, at this stage of the game, how much this type of technology could benefit our industry,” he said. Meisel has one vehicle in his fleet, for example, that can act as a standalone generator with exportable power. “That technology is spreading relatively quickly. I’m sure there are some smart people out there who will move it further than we have. But we’re excited about potential. We’re excited about the opportunities that it presents,” he said.

About the Author: Fiona Soltes is a longtime freelance writer based just outside Nashville, Tenn. Her regular clients represent a variety of sectors, including fleet, engineering, technology, logistics, business services, disaster preparedness and material handling. Prior to her freelance career, Soltes spent seven years as a staff writer for The Tennessean, a daily newspaper serving Nashville and the surrounding area.

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Warming up to the idea of solar? Here are a few things to consider:
• Recognize that the benefits of using solar power may be difficult to quantify, said Pacific Gas and Electric Co.’s Dave Meisel. As part of a larger energy management system, there have been some obvious wins. But it’s important to look at the picture more broadly; gains don’t just stop “at the door of the garage,” Meisel said, and may expand to other departments and areas.
• If you’re considering a particular system, make sure it’s within the proper parameters of any anti-idling legislation in the state or states in which your fleet operates, and appropriate for individual requirements. In addition, understand that anti-idling legislation likely will keep expanding.
• Keep an eye on solar developments. There is much interest, for example, in the commercial trucking space. Through companies such as Go Power!, eNow (www.enowenergy.com) and Green Solar Transportation (www.greensolartransport.com), solar and electric vehicle technology continue to develop.

Developing an effective approach when it comes to a strategic replacement cycle is a challenge that every fleet manager faces, regardless of the kinds of vehicles or equipment they may manage. The ability to gather and analyze data about your fleet and understand exactly how your fleet is performing has made the run-a-vehicle-into-the-ground approach not only woefully out of date, but it also has revealed just how expensive it is when compared to a well-designed replacement cycle.

The goal for every fleet should be to replace a vehicle before maintenance costs and downtime begin to rise, and at a time in the vehicle’s life when resale values remain meaningful. Determining how to reach that goal can vary from fleet to fleet, but by implementing an optimal replacement cycle for each vehicle or segment of vehicles in a fleet, a fleet manager can realize tremendous benefits and advantages, ranging from minimizing downtime and lowering operating costs, to keeping up with the fast-changing safety and technology features in more recent models, ensuring the safety and comfort of the fleet’s drivers in the process.

So, what considerations and best practices should you adopt in order to get the most from your replacement cycle strategy and experience the benefits of lower operating costs and optimal total cost of ownership?

What Does Your Company Need?
Any good evaluation begins with knowing the needs of your business and assessing the fleet you have. Are there gaps that need to be filled? Alternatively, are there vehicles that are not being fully utilized or are sitting idle? Knowing the specific operational needs of each business unit and reviewing your existing specs to make sure the fleet aligns with the business requirements of the organization help to create a foundation from which to begin your analysis. If you have done an analysis in the past, but it has been a while since you have reviewed it, take the time to update it. Consider whether vehicles that are being underutilized need to be replaced at all. Take a hard look at your specs to see if they can be simplified or pared down. Knowing where you stand before you begin to develop or alter a plan will help to ensure the eventual result is sound and will have a positive impact.

Evaluate and Analyze the Data
Now more than ever, fleet managers have access to volumes of data as well as the tools to parse that data so it provides insight and understanding. Fleet managers can look at maintenance expenses, including both recent and year-over-year comparisons, evaluate fuel expenditures and assess downtime across different vehicle segments. The transparency provided by the ability to evaluate data in an increasingly granular yet valuable way empowers fleet managers to make better decisions. The red flags that appear as the result of a thorough evaluation of your fleet’s data should be folded into the larger effort of building a sound replacement strategy and guide you even as you take other factors into consideration.

Additional Factors to Bring Into the Mix
There are a variety of different approaches to replacement cycling; deciding which one to use is dependent on the kind of fleet (i.e., its use and application) and the vehicles in use. But there are some standard factors that should always be a part of the overall equation.

The Usual Suspects
Any good analysis will consider some basic factors, including model year, total miles, overall condition, cost per mile and repair costs over a fixed period of time. Considering any of these in isolation is not the best approach, and having a single, fixed trigger (e.g., replace all of a certain kind of vehicle when they exceed a certain mileage) is not always effective either. Consider this: You could have two vehicles, both the same model year, but one may need to run more often to power specific, specialized additional equipment that it carries. This would increase the wear and tear on all of its components, especially when compared to the non-upfitted vehicle. Evaluating both on model year alone would not provide a full or accurate analysis.

Specialization
As a general rule, the more specialized a vehicle is – especially with regard to an upfit or other specially installed equipment – the more likely it will remain in service for a longer period of time. The specialization likely required a larger upfront investment and that comes into play when determining total cost of ownership. And, of course, a replacement is likely to require that same kind of investment.

Remarketing Cycles and Retail Demand for Used Vehicles
While it can vary based on the kind of vehicle and the current demand, the spring – tax season – through the fall remains the best time to sell used vehicles. Unless you have a vehicle that is in high demand on the used market, it is always a good idea to take the seasonality of the remarketing market into consideration. If you do have a segment of vehicles that is in high demand, consider the benefits of adjusting your cycling to maximize the resale value and take advantage of a hot market.

Branding and the Company Image
It never helps an organization to have vehicles in poor condition on the road. Vehicles with rust, substandard paint or body damage can reflect on the company as a whole and do damage to the brand and public standing of the organization. While not a driving factor, it is something to take into account.

Taking the time to develop a sound replacement strategy can save a fleet money and improve the bottom line. There is not one correct way or a single formula; success depends on a variety of factors that can change depending on the kind of fleet being evaluated and the needs of the business. But by investing a little time and thought, you can have a positive impact and a fleet that is cost-effective and on the road.

About the Author: Partha Ghosh is the director of North American vehicle supply chain and remarketing operations for ARI (www.arifleet.com), a privately held fleet management company headquartered in Mount Laurel, N.J.

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Vehicle Replacement Considerations: A Checklist
• Evaluate vehicles by category or segment.
• Know the needs of your business and align vehicle specifications accordingly.
• Use the data your fleet returns to your advantage.
• There are standard factors to consider, such as model year and total mileage, but no single factor should drive the decision.
• Specialization and vehicles with a unique upfit may require additional consideration.
• Take the ebb and flow of the remarketing marketplace into account.
• The condition of a vehicle can affect your organization’s brand and image; be sure to keep that in mind.

Maintaining strong working relationships with vendors is critical to running a smooth fleet operation.

To find out what makes and breaks these relationships, UFP recently spoke with Ron Henne, transportation supervisor for Eversource in Connecticut and Western Massachusetts; Matt Gilliland, director of transportation and facilities for Nebraska Public Power District; and Mel Holloway, product manager for global fleet management company ARI.

For all three men, customer service stands out as a major factor in determining if a vendor is going to be a short- or long-term partner.

Nebraska Public Power District has been working with several suppliers for 10 to 20 years because they continue to meet the fleet’s customer service expectations, according to Gilliland.

“We look for a vendor who will fix or supply it right the first time, on time, and at a fair price,” he said.

In addition to great customer service, vendors that provide total support – including post-sales support such as training – help seal the deal for Henne.

But what prevents fleet managers and vendors from establishing effective relationships? Be cautious of these three pitfalls.

1. Placing Too Much Emphasis on Cost
One mistake fleet managers make is basing purchase decisions – whether for equipment or service – solely on cost. Expecting something for next to nothing is a bad way to start or maintain a strong relationship with a vendor.

“Don’t just look at price,” Henne said. “Do your due diligence. Equipment is not a short-term purchase. You’re making a 10- to 15-year decision. The purchase price could be great, but what’s it going to cost you down the road? For example, you might save $1,000 on a piece of equipment, but roadside assistance is not included with the five-year warranty and could cost $5,000 to have it delivered every time it has a problem. So you really have to check everything. It’s the total package – the parts, the training, the warranty.”

Gilliland echoed that sentiment. “Poor customer service, poor delivery timelines and shoddy work cost more in the long run than any money saved up front,” he said. “A wise man once told me this: There are three kinds of service: fast, cheap and good. Pick two because you can never have all three.”

He strongly recommends a matrix approach to vendor selection that includes inputs such as local presence, past performance, response time, cost, warranty and support systems.

2. Poor Communication
It is no secret that excellent communication is essential to any strong relationship, but fleet managers and vendors sometimes struggle to effectively interact with each other.

“Many fleet managers have their own preferred communication methods, but above all communication needs to be timely and efficient,” Holloway said. “[Fleet management companies] need to blend a variety of techniques ranging from proactive push reporting to phone calls and in-person communications to ensure they are meeting the client’s need for information.”

Both Henne and Gilliland prefer to communicate with vendors via email.

However, fleet managers and vendors should choose their communication method based on what’s happening within their operation at the time. “If you’re going to buy 50 new trucks, that’s not an email,” Henne said. “That’s when you need to schedule several meetings. For a high-risk or complex situation, you’re going to want to be face to face.”

Holloway advised fleet managers to communicate often. “Don’t wait until there is a problem to reach out to a vendor,” he said. “Treat vendors as if they are a valued part of your team. Communicating changes about the fleet or equipment will help your vendors to stay up to date on your company’s needs.

“Remember that your vendor also has a business to run,” Holloway continued. “Scheduling conflicts, deadlines, cash flow and business growth are problems faced by most vendors. Awareness of and responsiveness to each other’s issues can help build long-term, satisfying and beneficial relationships with vendors.”

3. Unclear Goals and Expectations
Fleet managers must avoid ambiguity about their goals, objectives and expectations, particularly when it comes to expressing them to their vendor partners.

“Make sound decisions,” Henne said. “Develop your spec – consult internal users and make sure it’s detailed with everything needed – and then set out to bid with all the requirements.”

Determine which one vendor can provide what you need, when you need it, and for the right price. Evaluate everything from response time to contract terms to costs. Relationships take time to develop, so select a vendor with whom you and your fleet will be able to grow. At the same time, train vendors to meet your needs if necessary.

When a vendor understands how important customer service is to you, for example, they will be encouraged to work harder in that area. An understanding of your goals will help them make the best decisions in your favor.

About the Author: Grace Suizo has been covering the automotive fleet industry since 2007. She spent six years as an editor for five fleet publications and has written more than 100 articles geared toward both commercial and public sector fleets.