State of the Fleet Industry

AI is finally moving from a buzzword to solutions providing real value to fleets. But how? In this Fleet Momentum episode, Chris Brown, Bobit associate publisher, discusses with AJ Trivedi, CEO and founder of Ridecell, the AI and automation tools that are coming online to automate vehicle lifecycle management and maximize asset revenues.

Hello and welcome to this edition of State of the Fleet Industry Spotlight Series, sponsored by US Bank, in which we engage with leaders in fleet on what’s driving the market today.

I’m Chris Brown, associate publisher of Automotive Fleet. In this episode, I connect with Debbie Struna, national account manager for Fleet Street Remarketing, former board member of the American Fleet Leasing Association (AFLA), and chairperson for the Women in Fleet Management mentorship task force.

Debbie and I discuss how organizations can best plan for succession in the fleet manager’s role and the resources available for new entrants into the fleet community. Today's topics include: - Struna explains how she got into fleet.

- She discusses how new fleet managers can benefit from association involvement and industry events.

- Struna shares how to use internal meetings in the organization to create better awareness of the fleet manager’s role.

- She offers the idea of creating an industrywide document with best practices for succession planning.

- She discusses the succession process when she left her role as a fleet manager to take a new job.

- Struna suggests leveraging the vendor community for knowledge, along with fleet publications and media.

- She explains AFLA’s mentorship program.

The 139th State of the Fleet Industry video produced by Automotive Fleet offers insights into the state of the fleet market as presented by AF Editor Mike Antich.

🎙Today's topics include:

• One of the top trends impacting fleet managers is ongoing sourcing constraints to acquire replacement vehicles amplified by logistics delays throughout the entire order-to-delivery process.
• The average age of fleet vehicles is increasing. The limited availability of replacement vehicles has forced fleets to extend the service lives of those vehicles currently in service. This has resulted in fleet managers being forced to operate older vehicles in a high-mileage fleet environment, resulting in the inevitable uptick in unscheduled maintenance.
• The difficulty in sourcing replacement vehicles has caused fleet managers to use multiple OEMs or to compromise and settle for vehicles that may not be their first choice but are a secondary choice to fulfill the fleet application. This creates complexity in maintenance schedules due to the diversity in models in operation.
• Inflationary price pressures and higher interest rates are putting upward pressure on total fleet costs, such as fleet acquisition expenses aggravated by lower or no fleet incentives, higher repair expenses, higher labor rates, and the ongoing price increases of replacement parts.

The 138th  State of the Fleet Industry video produced by Automotive Fleet offers insights into the state of the fleet market as presented by AF Editor Mike Antich.

Today's topics include:

• The used-vehicle market remains strong for commercial fleet remarketing out-of-service company vehicles at auction, but there are three pain points that are negatively impacting fleets
• The ongoing delays in shipping out-of-service fleet vehicles to auction is increasing days-to-sale, which is increasing fleet depreciation expenses.

• There are backlogs in de-identifying fleet vehicles, sometimes as long as three to four weeks. Fleets require that their vehicles be de-identified of all logos and signage before they can be sold at auction. These delays are increasing days-to-sale.
• A third pain point is the lack of consistency at auctions in writing condition reports, which are the basis of how a vehicle is graded and has a direct bearing on the ultimate sale price.

Make sure you're signed up for the AF Newsletter so you don't miss another State of the Fleet Industry video.

Fleet Meet is an interactive dialogue with AF Editor Mike Antich and Hans Damen, managing partner for Fleet360 discussing the latest global trends in fleet management and contrasting their impact in the U.S. and the European fleet markets.

Today's discussion focuses on the proliferation of advanced driver-assistance systems (ADA) in fleet vehicles. Topics include:

• The risk that drivers will become too reliant on the safety technology, developing a false sense of security and becoming lax in performing basic safe driving skills.
• The need for fleets to properly instruct drivers on ADAS functions and correct usage of the technology.
• While extremely important to driver safety, ADAS technology increases a vehicle’s acquisition cost,  increases maintenance and repair costs, and adds a recalibration expense to ensure the system is functioning properly.

🤝 Follow and connect with Global Fleet on social media!

The 137th State of the Fleet Industry video produced by Automotive Fleet offers insights into the state of the fleet market as presented by AF Editor Mike Antich. In this episode, we talk with Mike Butsch, VP of global business development for Primrose Alloys.

Today's topics include:   

• In the automotive sector, demand for aluminum has softened due to component challenges in the automotive, medium-duty truck, and heavy-duty truck segments, which has created a slight relief in prices.
• There is a strong influx of aluminum orders from Boeing and Airbus, which will lengthen lead times for the balance of the year. Production constraints for stainless steel has lengthened lead times to 50-80 weeks for delivery.
• The ongoing war between Russia and Ukraine will continue to exert upward pressure on commodity prices due a decrease in product availability since both countries were strong exporters of aluminum and steel. In addition, ongoing tariffs on Chinese steel will put upward pressure on prices.
• The increased expenditure of munitions in Ukraine war has decreased munitions stockpiles in major industrial countries by 10-12 years. Pressure will mount to replenish stockpiles, putting upward pressure on brass and copper used in ammunition and heavier munitions and aluminum and stainless steel used in military equipment and missiles. Anticipation that these pricing pressures will begin at the start of 2024 calendar year.

Make sure you're signed up for the AF newsletter so you don't miss another State of the Fleet Industry video.

The 136th State of the Fleet Industry video produced by Automotive Fleet offers insights into the state of the fleet market as presented by AFEditor Mike Antich.

Today's topics include:

• Fleet acquisition trends in the oil and energy industry – pre-COVID – during the pandemic lockdown – and post-COVID.
• Energy companies have been forced to buy units out-of-stock from dealers due to replacement vehicle scarcity, which is typically above invoice pricing, especially in terms of pricing, and the advent of market price adjustments that dealers are adding on top of MSRP prices.
• With some vehicles being kept in service for more than 200,000 miles, the impact of unscheduled maintenance and other associated costs are substantial.
• The oil and energy business been impacted by labor shortages; however, some innovative programs are attracting workers from other states.

Make sure you're signed up for the AF newsletter so you don't miss another State of the Fleet Industry video.

In this special spotlight edition of the State of the Fleet Industry video series produced by Automotive Fleet magazine, Matt Dyer, president of Wheels, explains why Wheels was selected as the brand name for the combined legacy companies of Wheels Donlen and LeasePlan. Dyer also discusses the creation of the new company tagline and explains what will remain the same and what will change under the Wheels brand name.

Timestamps

• 0:00 Intro
• 0:45 Why the brand name Wheels and process of identifying that name
• 4:02 Behind the tagline "Together Let's Go Far"
• 8:18 What is changing and what stays the same

Make sure you're signed up for the AF newsletter so you don't miss another State of the Fleet Industry video.

The 135th State of the Fleet Industry video produced by Automotive Fleet offers insights into the state of the fleet market as presented by AF Editor Mike Antich.

Today's topics include:

The 134th State of the Fleet Industry video produced by Automotive Fleet offers insights into the state of the fleet market as presented by AF Editor Mike Antich.

Today's topics include:

• Fleet managers report increasing pressure from their management to identify areas to control fleet costs.
• Total fleet costs are proportional to total fleet size. Fleet costs are directly proportional to the total number of vehicles in operation, which, in turn, drives all fixed and operating costs, such as fuel, maintenance, depreciation, accident repair costs, etc.
• Fleets need to identify low-utilization vehicles and consider whether a driver should be shifted to a monthly allowance or cents-per-mile reimbursement program.
• “Vehicle hoarding” is occurring at some fleet operations because out-of-service or low-utilization vehicles are being retained “just in case” they are needed.
• Fleet inventory management must be an integral part of any cost containment fleet strategy.

Make sure you're signed up for the AF newsletter so you don't miss another State of the Fleet Industry video.

The 133rd  State of the Fleet Industry video produced by Automotive Fleet offers insights into the state of the fleet market as presented by AF Editor Mike Antich.

Today's topics include:

• The increase in fleet maintenance costs have been substantial, in some cases experiencing percentage increases that are double digit.
• Increased vehicle complexity has exerted increased maintenance costs through the increased volume of vehicle diagnostic fees, increased labor hours to identify intermittent issues, and recalibration expenses for ADAS-equipped vehicles.
• Increase in unscheduled repairs are more fleet vehicles are having their service lives extended due to difficulty in sourcing replacement vehicles.
• Part shortages are lengthening repair times for vehicles increasing vehicle and driver downtime.
• Inflationary pressures are increasing labor rates, parts prices, and pass-along costs from increased raw material prices used to manufacture replacement parts.
• Increased labor rates primarily driven by the shortage of skilled automotive technicians.

Make sure you're signed up for the AF newsletter so you don't miss another State of the Fleet Industry video.

The 132nd  State of the Fleet Industry video produced by Automotive Fleet offers insights into the state of the fleet market as presented by AF Editor Mike Antich.

Today's topics include:

• The 2023 Geotab Connect Conference was held on Feb. 5-8, 2023 in Orlando, Fla. It was attended by more than 1,700 fleet professionals.
• Geotab’s roadmap is to evolve into an AI-enabled platform that is hardware agnostic.
• Software defined vehicles can be updated with over-the-air downloads that will accelerate the introduction of new products in the fleet market.
• In 2013, the Commonwealth of Massachusetts passed a right-to-repair law. It is currently in litigation following a lawsuit from Alliance for Automotive Innovation, a consortium of auto OEMs.

Make sure you're signed up for the AF newsletter so you don't miss another State of the Fleet Industry video.

The 131st State of the Fleet Industry video produced by Automotive Fleet offers insights into the state of the fleet market as presented by AFEditor Mike Antich.

Today's topics include:

• Ongoing sourcing constraints have disrupted fleet standardization strategies.
• When businesses are forced to source different models, it creates inefficiencies by operating an irregular fleet of service vehicles.
• Multiple signs are emerging that sourcing constraints are receding – increased dealership inventories, dramatic decrease in “build shy” units, and OEMs are increasing new-vehicle production.
• Headwinds include an ongoing limited availability of vans and full-size pickups and huge pent-up need to extended life vehicles when companies were unable to source replacement units. 

Make sure you're signed up for the AF newsletter so you don't miss another State of the Fleet Industry video.

The 130th State of the Fleet Industry video produced by Automotive Fleet offers insights into the state of the fleet market as presented by AF Editor Mike Antich.

Today's topics include:

• Across-the-board fleet costs increases have hit record levels and promise to increase after sourcing availability increases.
• There are nine fleet costs at elevated levels. They are fuel, higher acquisition costs, interest rates, upfitting commodity volatility, unscheduled maintenance, collision repairs, higher maintenance/parts/ labor rates, short-term rental fees, and all incidental fleet costs.
• Today’s fleet dollars do not stretch as far as yesterday’s fleet dollars.
• With increased sourcing availability will come higher per unit expenditures, in addition to higher volumes currently restricted by an allocation system.

Make sure you're signed up for the AF newsletter so you don't miss another State of the Fleet Industry video.

What is influencing the fleet decision to single- or multi-source in today’s evolving market?

The 129th State of the Fleet Industry video produced by Automotive Fleet offers insights into the state of the fleet market as presented by AFEditor Mike Antich.

Today's topics include:

• There needs to be a re-establishment of trust between manufacturers, upfitters, dealers, and fleet end-users.
• Fleet managers believe that the difficulties experienced with sourcing constraints during the past three years have eroded the trust that has existed between buyers and sellers in the fleet industry.
• Some believe that sellers are taking advantage of today’s sourcing constraints by not honoring prior pricing commitments, which, in turn, is damaging long-standing business relationships.
• There needs to be a collective solution to ensure that buyer-seller relationships will remain strong and grow even stronger in the future. Industry leaders are encouraged to take the collective lead in making this aspiration a reality.

Make sure you're signed up for the AF newsletter so you don't miss another State of the Fleet Industry video.

Ralph Morton, Global Fleet Management editor for the U.K. and Europe, interviews a key fleet leader in the 20th GFM Voices video, produced by Automotive Fleet.

Topics include:

• Electrification and the possible recession this year.
• Pressures facing fleet managers of ICE fleets.
• Impact of vehicle deliveries on fleet plans in 2023.
• AFP resources and membership information.

The 128th State of the Fleet Industry video produced by Automotive Fleet offers insights into the state of the fleet market as presented by AF Editor Mike Antich.

Today's topics include:

• Service levels have fallen at DMVs and wait times for services have increased.
• Fleet managers say DMVs have become inconsistent in enforcing their own regulations regarding license and title issues.
• Compounding longer DMV turnaround time on registration and titling is the degradation in delivery times by the U.S. Postal Service.
• Among the root causes for the decrease in DMV service levels is staffing constraints, aging legacy computer systems, and reluctance in changing DMV processes need to fully take advantage of today’s technologies.

Make sure you're signed up for the AF newsletter so you don't miss another State of the Fleet Industry video.

The 127th State of the Fleet Industry video produced by Automotive Fleet offers insights into the state of the fleet market as presented by AF Editor Mike Antich.

Today's topics include:

• In the past 15 years, the Consumer Electronics Show (CES) has evolved into an important platform for a growing number of global automakers and Tier 1 suppliers looking to showcase mobility technologies.
• Stellantis revealed the Ram 1500 Revolution batter-electric concept pickup, which directionally is how the ultimate production version will be like when it debuts in the 2024 calendar-year.
• VinFast showcased its two all-electric SUVs and two all-electric crossover vehicles.
• Cenntro Electric Group displayed its Class 1-4 EV commercial vehicles and its upcoming Class 8 hydrogen fuel cell truck.
• Highlights of announcements from Mercedes-Benz, BMW, VW, Volvo, and the Sony Honda Mobility joint venture.

Make sure you're signed up for the AF newsletter so you don't miss another State of the Fleet Industry video.

The 126th State of the Fleet Industry video produced by Automotive Fleet offers insights into the state of the fleet market as presented by AF Editor Mike Antich.

Today's topics include:

• Various indicators seem to point to a slowdown in the national economy in calendar-year 2023.
• One consequence to an economic slowdown is an increase in fraudulent staged crashes.
• The No. 1 type of insurance fraud committed against company vehicles, in terms of total dollar value, is fraudulent staged crashes.
• Examined are the four most common staged accidents and recommendations on what company drivers should do if they are the victim of a fraudulent accusation.

Make sure you're signed up for the AF newsletter so you don't miss another State of the Fleet Industry video.

The 125th State of the Fleet Industry video produced by Automotive Fleet offers insights into the state of the fleet market as presented by AF Editor Mike Antich. In this episode, we talk with Shlomo Crandus, CEO of Wheels Donlen LeasePlan, about the purchase agreement and plans for the new company.

Today's topics include:

• Strategy to unify the distinct cultures of Wheels, Donlen, and LeasePlan into a new unified fleet management business that will go to market as one.
• Strategy to managing the operational integration of the three companies in terms of products and services they offer to clients.
• Discussion about the IT platform to be used by the combined organization.
• Discussion on how global integration will be structured with the unified company in the context of the ALD global alliance.

Make sure you're signed up for the AF newsletter so you don't miss another State of the Fleet Industry video.

The 124th State of the Fleet Industry video produced by Automotive Fleet offers insights into the state of the fleet market as presented by AF Editor Mike Antich.

Today's topics include:

• Production slowdown of finished commodities is due to labor shortages, not a decreased end-user demand.
• Steel prices have stabilized.
• Shortage of aluminum is anticipated due to simultaneous increased demand from both the aviation and automotive industries
• Copper prices forecast to increase in CY-2023 as automotive EV production increases.

Make sure you're signed up for the AF newsletter so you don't miss another State of the Fleet Industry video.

The 123rd State of the Fleet Industry video produced by Automotive Fleet offers insights into the state of the fleet market as presented by AF Editor Mike Antich.

Today's topics include:

• Home EV chargers have emerged as a brand-new asset class that will be managed by fleet managers.
• If the home charger is hardwired, no attempt will be made to recover it if the employee leaves and it will remain with the house.
• Employees must sign a waiver before a charger is installed in their home saying they will hold the company harmless should something go wrong with the installation.
• Supply chain constraints exist for switch gears and upgraded transformers with lead times of 12-18 months before delivery.

Make sure you're signed up for the AF newsletter so you don't miss another State of the Fleet Industry video.

The 122nd State of the Fleet Industry video produced by Automotive Fleet offers insights into the state of the fleet market as presented by AF Editor Mike Antich.

Today's topics include:

•     Several major OEMs announced during their presentations that fleet allocations will carry over to the 2024 model-year fleet ordering.
•     In a fleet allocation environment, most OEMs require pre-approval to place orders based on an allocation determined by a fleet’s past order volumes.
•     From a historical perspective, the second-year transition to a fleet ordering allocation system is truly a significant milestone that has never before happened in the history of fleet management.
•    In a fleet allocation environment, it is important to get internal approvals for your fleet budget done quickly so you can get OEM allocation approvals as soon as possible.

Make sure you're signed up for the AF newsletter so you don't miss another State of the Fleet Industry video.

The 121st State of the Fleet Industry video produced by Automotive Fleet offers insights into the state of the fleet market as presented by AF Editor Mike Antich.

Today's topics include:

• There is an ongoing inventory shortage of a wide cross-section of automotive replacement parts, increasing fleet downtime and fleet maintenance expenses.
• Due to difficulties in sourcing replacement vehicles, many companies are keeping existing fleet vehicles in service beyond scheduled replacement, resulting in higher unscheduled maintenance.
• Needlessly aggravating the delay in repairing fleet vehicles is the inconsistent communication from service facilities on repair status.
• The parts shortage is delaying the repair of accident damaged fleet vehicles. Today, on average, it takes 15 to 30 days longer to get parts at body shops compared to 2019.

Make sure you're signed up for the AF newsletter so you don't miss another State of the Fleet Industry video.

The 120th State of the Fleet Industry video produced by Automotive Fleet offers insights into the state of the fleet market as presented by AFEditor Mike Antich.

Today's topics include:

• Fleet managers anticipate vehicle availability will incrementally increase in calendar-year 2023, but this will be partially offset by the fact that total end-user demand will continue to exceed vehicle availability.
• OEM fleet ordering allocation systems are limiting fleet buyers to fewer vehicles than they requested, causing unordered vehicles to be carried over to the next model year.
• Ultimately these units that have been carried over into the next model-year will need to be replaced. But eliminating this pent-up demand will take a while.
• Eventually, the industry is going to find equilibrium between vehicle production and end-user demand, but unfortunately that doesn’t look like it will happen in calendar-year 2023.

Make sure you're signed up for the AF newsletter so you don't miss another State of the Fleet Industry video.

The 119th State of the Fleet Industry video produced by Automotive Fleet offers insights into the state of the fleet market as presented by AF Editor Mike Antich.

Today's topics include:

• Altogether automakers — globally — plan to double their EV spending to $1.2 trillion to build 54 million battery-electric vehicles by 2030.
• Today’s current transition to EVs dwarfs the cost of the Apollo space program. In fact, today’s transition to electrification will invest $1 trillion more than what it cost to put 12 people on the moon.
• Globally, automakers are forecasting that half of their total worldwide vehicle production will be EVs by 2030. And it will take $1.2 trillion to achieve this goal.
• A new tax credit under the Inflation Reduction Act is anticipated that will be that provides a $7,500 tax credit for commercial EVs with no restrictions on battery sourcing or manufacturing.

Make sure you're signed up for the AF newsletter so you don't miss another State of the Fleet Industry video.

The 118th State of the Fleet Industry video produced by Automotive Fleet offers insights into the state of the fleet market as presented by AF Editor Mike Antich.

Today's topics include:

• On average, diesel stockpiles today are 30% lower than what they have traditionally been at this time of year. As of Oct. 21, diesel supply in the U.S. is down to 25 days, which means diesel inventories are at their lowest level for this time of year since 2008.
• There is a direct correlation between the low inventory of diesel and the price at retail pumps. This low supply is exerting upward pressure on the price of diesel, especially since there is an ongoing strong demand for the product.
• When diesel stockpiles contracted in April and May 2022, it created upward pressure on retail prices. In May 2022, No. 2 diesel hit an all-time record retail price of $5.51 per gallon.
• The higher cost of diesel creates inflationary pricing pressures. For instance, when the cost to transport goods increases, those increased costs are passed on to end-users.
• What will ultimately bring down the price of diesel and increase the inventory of diesel fuel will be the recession that everyone is predicting. A recession would slowdown in end-user demand and industrial activity, which, in turn, will put downward pressure on fuel consumption.

Make sure you're signed up for the AF newsletter so you don't miss another State of the Fleet Industry video.

The 117th State of the Fleet Industry video produced by Automotive Fleet offers insights into the state of the fleet market as presented by AF Editor Mike Antich.

Today's topics include:

• More and more of these catalytic converter thefts are turning violent, and on at least three occasions, the vehicle owners were killed while the crime was in progress.
• It is important to instruct employee drivers not to confront thieves who are attempting to steal catalytic converters from their fleet vehicles and instead to keep their distance and immediately call 911.
• In 2018, there were 1,298 catalytic converter thefts. Three years later, in 2021, catalytic converter theft claims jumped to 14,433 incidents — a 325% increase in a single year.
• Year to date, in calendar-year 2022 from January to September, more than 50,000 catalytic converters have been stolen from parked vehicles in the U.S.

Make sure you're signed up for the AF newsletter so you don't miss another State of the Fleet Industry video.

The Fast Forward video series, hosted by Bobit Fleet Group Editor Chris Brown, is about connecting with leaders in fleet, tech, and automotive to show what the future holds for fleets of all types.

The 116th State of the Fleet Industry video produced by Automotive Fleet offers insights into the state of the fleet market as presented by AF Editor Mike Antich.

Today's topics include:

The 115th State of the Fleet Industry video produced by Automotive Fleet offers insights into the state of the fleet market as presented by AF Editor Mike Antich.

Today's topics include:

• Parts shortages first started to appear in the fourth quarter of 2020 and since have been a series of ongoing and sporadic inventory shortages for a variety of automotive components throughout calendar years 2021 and 2022.
• Demand for key commodities used to manufacture automotive parts has lengthened production times, thereby increasing delivery times.
• These ongoing component shortages have triggered prices increases for individual parts — on average — up to 20% to 30% and in some cases, the price of certain parts have doubled.
• Higher commodity prices increase manufacturing costs thereby reducing manufacturers’ margins, which puts upward pressure to increase parts prices. These increased costs are passed on to end users.

Make sure you're signed up for the AF newsletter so you don't miss another State of the Fleet Industry video.

The 114th State of the Fleet Industry video produced by Automotive Fleet offers insights into the state of the fleet market as presented by AF Editor Mike Antich.

Today's topics include:

• Examined is the transition by most OEMs to an allocation system designed to manage the acquisitions of their products by their fleet customers.
• The implementation of controlled allocation systems is a significant development because it is truly a historic milestone that has never happened before in the history of fleet ordering.
• Sourcing constraints could theoretically continue into the 2025 model-year due to the large industry-wide pent-up demand of unfilled cancelled orders carried over to the next model year.
• An economic recession could accelerate the increase in fleet allocation by dampening retail demand for new vehicles.

Make sure you're signed up for the AF newsletter so you don't miss another State of the Fleet Industry video.

The State of the Fleet Industry Spotlight video series is produced by Automotive Fleet puts a spotlight on key leaders in today’s fleet management industry. In this episode Matt Dyer, CEO and president of LeasePlan USA, is interviewed by AF Editor Mike Antich.

Today's topics include:

• Discussion of today’s sourcing constraints for replacement vehicles and the inflationary pressures on fleet total cost of ownership and a forecast for calendar-year 2023.
• Fleet electrification trends and the challenges of simultaneously operating an EV and ICE fleet.
• The impact of connectivity on both vehicle asset management and driver management.
• Latest developments in the pending acquisition of LeasePlan USA by Athene, the parent company of Wheels Donlen.

Make sure you're signed up for the AF newsletter so you don't miss another State of the Fleet Industry video.

The 113th State of the Fleet Industry video produced by Automotive Fleet offers insights into the state of the fleet market as presented by AF Editor Mike Antich.

Today's topics include:

• The European Union and the state of California have issued mandates that only zero-emission vehicles may be sold in their jurisdiction by 2035.
• EV production mandates will drive commodity demand and will put upward pressure on key commodities such as aluminum and copper.
• The No. 1 buyer of finished aluminum is the aviation industry, which will be competing with the auto industry for future aluminum capacity.
• Parallel production of EV and ICE vehicles in other regions will increase commodity pressures.

Make sure you're signed up for the AF newsletter so you don't miss another State of the Fleet Industry video.

The 112th State of the Fleet Industry video produced by Automotive Fleet offers insights into the state of the fleet market as presented by AF Editor Mike Antich.

Today's topics include: