Fleet vehicle acquisition planning: Future-proofing your organization’s operations
February 21, 2024
As we approach the 2025 model year ordering cycle, proactive fleet vehicle acquisition planning is crucial for long-term fleet success. With ever-evolving business landscapes and shifting market trends, it is imperative for organizations to possess a comprehensive and future-proof strategy that can effectively navigate current vehicle acquisition intricacies that could impact your fleet operations.
Element Fleet Management's clients gain valuable insights from our team of trusted advisors. Through deep, ongoing analysis of our clients’ fleets and access to robust industry data, our partnership can help ensure successful planning and execution for the upcoming 2025 model year ordering cycle by providing practical advice and key considerations for fleet managers related to the latest fleet trends. By staying ahead of the curve and embracing innovative approaches, your organization can position itself for long-term success in the dynamic world of fleet management.
Continue reading as we explore the strategies, considerations and best practices that will empower you to make well-informed decisions, optimize resource allocation, and maximize the value of your fleet assets. Together, let's navigate the complexities of fleet vehicle acquisition and build a fleet poised to achieve your organization's goals.
What is fleet vehicle acquisition?
Fleet vehicle acquisition is a comprehensive process that involves purchasing or leasing vehicles specifically tailored to meet the operational needs of your organization. It encompasses a range of tasks, such as:
- Selecting the right vehicles,
- Negotiating contracts,
- Contingency planning for allocation limitations,
- Arranging optimal financing options, and
- Efficiently managing delivery logistics.
The ultimate objective is to ensure that your fleet not only aligns with your operational requirements and budgetary constraints but also maximizes productivity and enhances driver satisfaction through planned vehicle selection and management. Proactively identifying the best-suited vehicles for specific roles and taking into account factors such as fuel efficiency, maintenance costs, driver satisfaction, and original equipment manufacturer (OEM) ordering limitations, will help your fleet realize optimal operational success.
Trusted advisors in fleet acquisition
When it comes to fleet acquisition, engaging with Element's Strategic Advisory Services team can uncover unique cost-saving opportunities through data-driven analysis, proactive planning and continuous leadership to help clients realize tangible results.
Macroeconomic factors
Macroeconomic factors play a crucial role in fleet acquisition decisions and through in-depth analysis, our Strategic Advisors can offer valuable insights into these market trends. For example, when faced with increasing fuel prices, fleets may consider adopting more fuel-efficient or electric vehicles, to help drive cost savings and environmental sustainability. Additionally, by staying updated on potential tax incentives, Element’s Strategic Advisors can help you explore leasing options that are not only financially viable but also align with your long-term business goals. Our expertise and holistic planning can help you make informed decisions that optimize your fleet management approach and drive overall success.
Production and supply chain implications
After several years of production delays and supply chain disruptions caused largely by the ongoing global microchip shortage, 2023 saw substantial stabilization regarding the resale market. However, supply chain disruptions due to the pandemic caused critical parts shortages, driving up vehicle repair costs and the downtime associated with repairs significantly. This necessitates a deep understanding of intricate supply chain dynamics and an ability to navigate potential disruptions effectively. In this context, Element's Strategic Advisors play a crucial role in helping you gain robust understanding of how these factors can impact not only your acquisition decisions this year, but resale and maintenance of aging vehicles as well.
Allocations
Over the last few years, OEMs moved to an allocation model for ordering, effectively requiring a pre-approval from the OEM to place orders. With this continuing in 2024, strategically distributing vehicles across your fleet is even more crucial for optimizing productivity and minimizing costs. Establishing relationships with multiple OEMs can also prove beneficial should one manufacturer not be able to meet your fleet ordering needs.
Tailored solutions for fleet acquisition
Balancing productivity, cost management, and driver satisfaction can be challenging. To overcome these challenges, Element focuses on designing fleet management solutions that are tailored to align with your organization’s business strategies and mobility goals.
Maintenance costs
One of the most significant pain points in fleet management is the substantial cost associated with maintaining aging vehicles. These older models often require frequent repairs and replacements, resulting in increased downtime and maintenance expenses. However, by strategically replacing these aging vehicles with newer models that boast improved reliability and efficiency, your fleet can realize cost savings and enhanced overall fleet performance and productivity. Element’s Strategic Advisors perform optimal replacement analysis to help our clients determine the best time to replace vehicles. This proactive approach ensures smoother operations, minimizes unexpected breakdowns, and optimizes the financial resources allocated to fleet management activities.
Budgeting and incentives
Factoring pricing and incentives into your model year 2025 acquisition plan is a necessity to optimize your fleet budget. By carefully considering volume discounts and early bird incentives, you can unlock substantial savings for your organization. These cost-saving measures not only help you stay within your budget but also contribute to long-term financial stability and growth. Now is the time to analyze and implement these well-thought-out plans to make the most of your fleet acquisition process.
Productivity improvements
Newer vehicles, with cutting-edge technology and advanced features, offer a wide range of functionalities that not only enhance driver productivity but also elevate the overall driving experience. From advanced driver assistance technologies that help ensure safety on the road to innovative connectivity solutions that seamlessly integrate with smartphones and other devices, these features allow drivers to stay connected, navigate effortlessly, and have a more productive and enjoyable driving experience leading to improved driver retention.
Breakthrough technology in fleet acquisition
Meeting productivity targets requires access to actionable data. Xcelerate™, Element’s fleet management technology system, empowers clients with custom reporting and real-time vehicle data, helping them continuously manage inventory and vehicle allocations.
By integrating advanced technology into the fleet acquisition process, you can streamline operations, make informed decisions, and put yourself at the cutting edge of the fleet space. From telematics solutions that provide insights into driver behavior to advanced analytics tools that predict maintenance needs, technology is reshaping fleet acquisition.
Proven fleet acquisition
A recent Element client case study illustrates the results that can come from holistic considerations regarding fleet acquisition decisions.
Case study
A client with a decentralized fleet spanning more than 20 business units with drivers in diverse job functions approached Element to identify cost savings opportunities and strategies to ensure vehicles are best suited for their fleet needs.
Element conducted a robust analysis of the fleet and helped the client classify job functions into two groups - salespersons carrying products and service technicians. Additionally, Element and our client held an in-person event for drivers to perform test drives and cargo carrying exercise and provide feedback to help ensure the right vehicle selection for job functions.
Element's assessment and the job function classification resulted in the development of a vehicle selection plan that saved the client more than $500,000 in annual costs. This significant savings came from optimized fleet vehicle options based on job function and improved fuel efficiency with the incorporation of hybrid vehicles.
Get the most out of your fleet vehicle selection
Planning for the 2025 model year requires a strategic approach to fleet acquisition and a robust understanding of factors that can impact your fleet operations. Leverage Element Fleet Management's trusted advisors, tailored solutions, and breakthrough technology to future-proof your fleet, enhance productivity, and achieve cost savings. Contact us today.
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