What is Fleet Rightsizing?

“Fleet Rightsizing” is a proactive management practice used to ensure that a fleet is composed of the correct vehicle mix to meet an organization’s real needs. Fleet Rightsizing is crucial practice for municipalities, as their fleet inventories often grow over time to include vehicles that are highly specialized, rarely used, or unsuitable for current applications. 

Why Fleet Rightsizing Matters

When a fleet is not “rightsized,” the following problems are common:

• Overspending: Municipalities may purchase or lease more vehicles than they need, wasting taxpayer dollars on vehicles, maintenance, and insurance. Moving to a “pay for what you use” financing model instead of buying vehicles outright can keep 20% more cash in an annual budget and/or allow your organization to transition to EVs more quickly.

• Inefficiency: Vehicles not being used efficiently can waste fuel, time, and resources. Regularly exceeding a vehicle's payload can increase general wear and tear on a vehicle and also put drivers at risk of break failure. 

• Driver safety: Some of the most important safety features are not present in older vehicles (e.g. electronic stability control was not standard on vehicles until 2012). As a  result, older vehicles are less safe for municipal drivers  and will carry higher insurance premiums for your organization. 

• Environmental impact: A fleet of overly large gas vehicles consumes more fuel than actually needed and produces unnecessary emissions.

Eliminating oversized or inefficient vehicles is one of the easiest ways to cut a fleet’s carbon footprint -- saving money on fuel, maintenance, and insurance. With attention to Fleet Rightsizing and regular financing review, municipalities can save 10-15% in costs before they even begin the switch to EVs.  

Benefits of Fleet Rightsizing for Municipalities

Not all cities and towns have the expertise to rightsize their fleets. However, fleet rightsizing has significant benefits for municipalities adopting, including: 

• Reduced Operating Costs: By streamlining fleet size based on a careful assessment of current needs and costs, municipalities can enjoy savings on fuel, maintenance, and insurance. These savings will be even higher once the municipality begins transitioning to electric vehicles, as EVs have much lower operating and maintenance costs compared to traditional internal combustion engine vehicles.

• Increased Fuel Efficiency: Replacing older vehicles with fuel efficient models and/or electric vehicles results in reduced energy consumption and lower emissions, offering environmental sustainability while mitigating climate change.

• Improved Fleet Management: Fleet rightsizing enhances operational efficiency, leading to optimized resource allocation, better vehicle utilization, and reduced overall costs. Once added, electric vehicles can be integrated with fleet management systems to monitor charging patterns, optimize routes, and further improve efficiency. 

A “rightsized” fleet will help a municipality cut costs and reduce its carbon footprint. In addition, the process also helps identify those vehicles that should be rapidly replaced with EVs for optimal savings. 

Factors to Consider in Fleet Right-Sizing

If you are contemplating a fleet rightsizing project as part of your municipality’s electrification transition plan, you will want to review a number of factors, including: 

• Size and Scope of Operations: Evaluate the specific needs and demands of each department within your municipality's operations, considering factors such as service areas, workloads, and the types of vehicles required.

• Vehicle Types: Analyze the suitability of vehicle types within the fleet to ensure they align with operational requirements and optimize energy efficiency. Identify the appropriate use for electric vehicles considering factors such as range, charging infrastructure, and vehicle availability.

• Budget: Budget is important for every fleet, but it is especially critical for municipalities where there is a fiduciary duty to spend taxpayer money wisely and reduce waste.  Budget constraints must be factored in when determining the ideal fleet size and composition, including upfront costs, total cost of ownership, and long-term monetary savings. Evaluate the financial incentives, grants, and subsidies available for electric vehicle adoption to make informed decisions.

• Environmental Goals: Incorporate the municipality's environmental objectives, aiming to reduce emissions and contribute to sustainable practices through fleet rightsizing efforts. MoveEV’s software can help a municipality specify performance targets for electrification and measure/report on the environmental savings as the fleet makes this switch. 

The Fleet Right-Sizing Process

The first step in a fleet right-sizing project is a comprehensive audit of the current fleet’s composition, performance, utilization, and efficiency. During this phase, the goal is to collect as much data as possible about each vehicle including age, mileage, maintenance records,  telematics (if available), and more. The more complete the data, the easier it will be to identify opportunities for right-sizing. If data is spare, you should consider implementing a fleet management system in the future to track vehicle usage, monitor performance, and identify areas for cost reduction and optimization. No matter how much or how little data your municipality has about its current gas fleet, MoveEV can help you make the most informed fleet right-sizing decisions today possible while planning for the future. 

Running An Ongoing Fleet Rightsizing Program 

While a one time rightsizing project is a good first step, fleet rightsizing should really be an ongoing process with regular (semi-annual or annual) reviews, depending on the size and complexity of the fleet. An outside firm like MoveEV can help with ongoing monitoring and planning adjustments, and can also play an important role in establishing a long-term multi-year sustainable budget.

It is also worth spending time on internal buy-in for your program. You should plan to engage senior managers from the start, and it is worth making sure all municipal employees understand the benefits of fleet right-sizing to the organization. As the right-sizing process may change individual employee’s access to vehicles or driving routines, engaging employees early and educating them about the benefits of the program on the whole is important for fostering widespread support. Encourage active participation early and set aside time to address any questions or concerns. It may also be helpful to educate employees on alternative transportation options and fuel conservation practices, empowering them to embrace sustainable commuting habits.

Conclusion

Fleet right-sizing is a strategic management approach that empowers municipalities to optimize efficiency, reduce costs, and contribute to environmental sustainability. By carefully assessing operational needs, considering vehicle types, and implementing effective management practices, municipalities can achieve a well-aligned, sustainable and cost-effective fleet.  

With senior management support, effective communication, and ongoing monitoring, municipalities can successfully implement fleet right-sizing initiatives, leading to long-term benefits for both the organization and the community.

Need help with fleet rightsizing? MoveEV is here for you! Learn more about our fleet management services today!