How fleets can save on maintenance costs with optimal replacement
I often say: Sometimes, coming up with a vehicle replacement strategy is all it takes to save money on your fleet. I recently partnered with one of my clients to see this put into action — and it did not disappoint.
The company is in the medical insurance industry and manages a fleet of more than 300 vans and minibuses. The vehicles are used to transport patients to and from medical centers safely. Most of the fleet has ambulatory and wheelchair seating capacity to ensure every patient was well accommodated.
The situation my client was facing involved an aging fleet and no vehicle replacement strategy, which left the company in reactive mode when evaluating fleet decisions. This was leading to a continual increase in maintenance costs.
I knew right away that an optimal replacement analysis could really benefit their fleet. With the support of LeasePlan’s Analytics, Consulting and Transformation (ACT) team, we worked to evaluate historical fleet information on vehicle fleet maintenance spend, capitalized cost and interest rates. We also took a look at the client’s current lease structure.
With this information, The ACT team was able to create optimal replacement parameters for each vehicle type in the fleet. Through the analysis, we also found that changing to a different vehicle with better seat and ambulatory capacity could help the company better achieve its goals.
The result? By replacing 77 vehicles of the fleet, which had more than 48 months in service, my client realized maintenance savings in excess of $1 million year-over-year. Imagine that! Through an optimal replacement analysis, the fleet improved its fuel economy, adjusted depreciation rates and saved on rental costs. This, in turn, allowed the company to continue doing what it does best: Caring for patients.
Want to know more? Check out this optimum replacement analysis guide to see how an optimal replacement strategy could benefit you. Or leave me a comment with your burning questions! I’m happy to help.