From the very onset of companies, the car was the only way for employees to stay mobile. There are few companies that do not offer transport to their staff, forcing them to use public transport. In some countries, the car is part of the remuneration package, or a means of company promotion.
Small and medium companies link the car to one employee; cars of larger companies are shared between several of them. Let’s admit, a car is an expensive acquisition, not to mention its operational costs.
Many of us have been in situations where the company car is used for both business and personal needs, when we fill the tank for the company car and our car, when we take poor care of the car and break it, or drive irresponsibly, and the police sends tickets to the company. Don’t worry when your company has only one car, and you are driving it. But what about companies with 15.000 cars? You need a separate department just for management of all this fleet.
But technical and financial challenges are nothing compared to the cost of the car downtime or other inefficient use. You don’t have to be a great accountant to realise that if your car is parked and does not perform a job, you do not need it. Perhaps, if you had one car that you were not using, you would sell it. But what a company with 15,000 cars, 15,000 euro each, can do when those cars are not used efficiently?
Let’s say, 15,000 cars can operate to a maximum of 24 hours a day. OK, at least 8 business hours. This means, the entire fleet will work for 120,000 hours per month. So one business hour of your entire fleet (fuel, repair, i.e. variable costs) will cost you 142,800 euro (1.19 euro per car/hour = 15,000 euro – 3,000 euro residual value /60 month*168 h).
The main challenge is to calculate the number of hours per month when your cars are parked and not used for different reasons.
For our big surprise, we got a request from one large company about the technical solution for fleet management, which is natural, but one part of the question surprised me. The company was looking for an option not only for traditional car booking for their employees, but also for usual car sharing, i.e. refusing reservations, and allowing employees to simply take any car available at the moment. No key administration, because it can be unlocked with a smart phone. Interestingly, they want to let available (surplus) cars for free circulation on the market and even get income from it.
So the company fleet management is being transformed into a new reality – use as much as you need, and sell surplus on the market. Lets see where this new trend lead us.