Fuel costs are one of a fleet manager’s largest expenses. Applying the best fleet fuel practices such as idling reduction efficient routing are highly effective approaches to reducing fuel costs. Using a web-based fleet GPS management system, purchasing fuel-efficient vehicles, and relocating a key fueling station are also ways to reduce fuel consumption and employee hours.
Fleet Managers should apply the following basic principles of good fuel management because these are proven to be the most effective approach trimming fuel costs and consumption. Once these “best of” fleet management practices are implemented and consistently executed, innovative solutions can further promote control of one of fleet’s most expensive operational costs. The Best Fleet Fuel Management Principles include:
- Right-sizing fleet vehicles.
- Idling reduction.
- Fuel-efficient vehicles.
- Consistent scheduled maintenance.
- Eco-Smart driver education.
- Tracking fuel expenses.
- Efficient route planning.
The following article discusses how government fleets around the US are successfully managing and reducing fleet fuel expenses. This Part One of a Series of Articles. Next to to depreciation, fuel is the second greatest public sector fleet expense. Municipal, county, and state fleets reveal their best practices in reducing fleet fuel expenses.
Identify underutilized vehicles and equipment with high maintenance costs
The City of San Antonio’s Fleet Management Department reviews fuel requirements and usage, vehicle mileage, and fleet maintenance costs to identify underutilized vehicles and unnecessary equipment with high maintenance costs with fleet tracking telematics equipment. San Antonio’s fleet is comprised of approximately 5,050 vehicles and equipment, mostly sedans (1,500) and specialized equipment (3,000-plus), including refuse trucks, trailers, and off-road equipment. The city has been successful in reducing the size of its fleet and when necessary purchase more fuel efficient fleet vehicles.
“In an effort to further reduce fuel costs and emissions, the City is currently evaluating the introduction of both E-10 (10-percent ethanol) and B-5 (5-percent biodiesel) fuels,” said Florencio Peña, fleet manager, City of San Antonio. “Compressed natural gas (CNG) is used to power 30 of the City’s side-loader refuse trucks, and propane has been used for several years to power both vehicles and equipment.”
Replaced outdated fuel card reader systems with an automated fuel fleet management system
Fleet Cost-Reduction Strategies: Direct Expenses
Reduce fuel costs. Fleet operators should focus on miles per gallon. Fuel costs are a large direct operating expense, especially for fleets with high mileage each month. Many fleet managers approach fuel cost savings by looking for purchase discounts, which aren’t really feasible unless the fleet can fuel in volume at a single site. Fleet fuel cards can be used to direct driver purchases away from premium fuel, which offers some benefits, but the most significant fuel savings come from selecting more fuel-efficient vehicles. Moving away from heavy vehicles and larger engines can provide 30% to 50% fuel economy increases. Using a fleet tracking system to identify poor driving behavior that burns excessive fuel, such as speeding and unnecessary idling can reduce fleet fuel costs by approximately up to 12% per year. Also, a fleet fuel card will help move 8% of fuel purchases away from premium fuel.
Secure the best fleet financing. Proper vehicle financing should absolutely be considered. Leasing vs. ownership of fleet vehicles is a common funding decision for fleet managers, and the economic analysis often ends in a tie. The decision to lease or own frequently hinges simply on balance-sheet considerations.