FSG forum is platform for highlighting fleet cost-cutting measures

Press stories suggest that the recessionary gloom of recent months could be coming to an end amid signs of economic green shoots.

However, it is a racing certainty that individual sectors of industry and business will emerge from the recession at very different speeds so there should be no room for cost control complacency.

Daily dialogue with a wide range of customers and prospects across many different business segments highlights a desire to cut costs that Fleet Support Group has not seen for many years.

Yet, Chairman Geoffrey Bray is concerned that too few clients have taken up the wide range of cost-cutting measures promoted by the company.

“Our aim is to help customers cut their fleet operating costs. There are no better examples than our zero tolerance approach to crashes and a similar attitude to vehicle service, maintenance and repair (SMR),” he said.

“Drivers looking after their vehicles means reduced SMR costs and, similarly, taking steps to eliminate road crashes will bring significant financial savings.

“Case study evidence from a range of clients, including Network Rail, Warburtons, WHSmith and Dun & Bradstreet, highlights how they have all cut costs by introducing a range of measures that ensures vehicles are kept on the road.

“But too few companies want to follow their lead. Instead they introduce a range of barriers that can be best described as ‘excuses’ for not wanting to take action.”

However, explained Mr Bray: “With the majority of employees grateful for a job and a company-provided vehicle there has never been a better time to cut costs. Indeed, in our experience, many employees understand that their employer must take steps to reduce spending as a result of the recession so will not be surprised that the fleet operation is under the spotlight.”

Helping companies introduce cost-saving measures is the reason for the introduction of FSG’s Cost Reduction Group Interactive Forum. The online site highlights a range of ideas to help firms cut vehicle operating costs.

The site was launched last year with the aim of FSG’s experts and customers promoting and sharing cost-cutting ideas in a ‘newsgroup-style’ format.

Issues highlighted to-date include:

• Reducing fuel costs

• How to prevent expensive misfuelling incidents

• Whether fleet decision-making should be HR- or finance-driven

• Cost reduction opportunities for drivers, vehicles and journeys

The interactive site is the platform for exchanging information, but forum moderator Gary Kent is disappointed at its lack of use.

He said : “Cost management remains the number one priority for all fleet operators amid the ongoing economic crisis. Through the cost reduction forum we hoped to get lots of ideas from customers on new ways of working, but the site has not sparked the interaction that we had originally anticipated.

“We believe it is vital for fleets to share with each other the cost savings that are taking place and the forum is a useful platform for those ideas to be exchanged. There are no excuses for not taking out cost.”

Access to the forum is via a password-protected website. For further information and to join the forum email helpdesk@fsguk.com.

Firms save hundreds of pounds through proactive safety measures

Businesses are cutting their average insurance claim by up to £80 after introducing road safety initiatives and accident management processes.

A ‘league table’ of Fleet Support Group customers that have implemented the company’s RiskMaster occupational road risk management programme and simultaneously proactively used accident management data to further help cut crashes highlights the financial savings.

For example, one organisation that saw its company vehicles involved in 72 crashes in the 12 months ending July 31, 2008 with an average claim cost of £439.17 saw the respective figures drop to 37 and £362.50 in the 12 months ending July 31, 2009 - an average saving of £76.67 per incident (see chart below).

Meanwhile, a national organisation that saw its company vehicles involved in 18 crashes in 2007/8 with an average claim cost of £261.05 saw drivers involved in only 13 claims in 2008/9. The average insurance claim in the 12 months to July 31, 2009 also dropped to £188.39 - a saving of £72.66.

Elsewhere, while an organisation has been able to significantly cut its accident record - 165 fewer claims during the two years under review - the average claim cost has increased slightly (+£4.99). However, overall the safety-focused initiative has delivered significant cost savings as a result of the large reduction in incidents.

FSG Chairman Geoffrey Bray said: “Businesses that take a proactive attitude to managing road risk reap the benefits of a marked reduction in the number of road traffic accidents involving their staff.

“This not only shows organisations adopting a caring attitude towards the safety of their staff, but also delivers huge business benefits, which includes significant reductions in the cost of accidents.

“The financial savings highlighted by our ‘league table’ coupled with the reduction in business disruption that accidents inevitably cause mean that an all-embracing focus on crash management delivers financial benefits.”

The right tyres and pressures can save fleets money

Tyre choice and pressure maintenance have a direct impact on fuel bills - the wrong tyre and incorrect pressure cannot only prove financially costly but could also put road safety at risk.

With 20% of a car’s fuel consumption needed to overcome tyre rolling resistance, tyre choice and pressure maintenance have a direct impact on fuel bills, according to leading tyre manufacturer Michelin.

The technology deployed by Michelin in its latest generation of ‘green’ tyres, the Energy Saver, provides lower rolling resistance generating fuel savings as well as reductions in CO2 emissions, says the organisation.

In fact, independent tests have proven that the Michelin Energy Saver tyre produces greater fuel savings than its main European premium competitors*.

It is calculated that a company car driver travelling 20,000 miles a year on Energy Saver tyres could save around £45 in fuel costs compared with the average of its competitors*.

This means, says Michelin, that a fleet of 200 cars using Energy Saver tyres could reduce its fuel costs by £27,000 based on a benchmark three-year/60,000 mile policy, while also reducing the fleet’s carbon footprint.

In addition to enhanced fuel efficiency and safety performance the Energy Saver also offers outstanding longevity, says Michelin.

Longer-lasting tyres not only save fleets money but also result in fewer worn tyres to recycle which has a positive effect on the environment. In independent tests carried out in 2009 the Energy Saver was shown to last 38% longer than the average of its competitors*.

A Michelin spokesman said: “Taking into account the combination of fuel savings and additional tyre life it is easy to see how a fleet operator could potentially make considerable savings just by taking some time to choose the best tyre for their vehicles.”

As well as using energy efficient tyres, drivers can also help cut their fuel bill and make their tyres last longer by running the correct tyre pressures.

A tyre that is 20% under-inflated (as little as 6psi under) can not only increase fuel consumption by 2% but can reduce tyre life by more than 20%. Tyres that are under-inflated will not only cost fleets more to run but could also be unsafe as they adversely affect the vehicle’s handling, braking and aquaplaning performance.

To highlight the problem, last year’s Michelin Fill Up With Air campaign toured the UK and Ireland checking tyre pressures and the results were shocking, said the spokesman.

Of the 2,700 cars checked - 104 were company cars - more than 60% were found to be running with incorrect tyre pressures and of these, more than 35% were dangerously under-inflated (more than 7 psi under the recommended pressure).

With regards to company cars, only 39% of those vehicles checked were correctly inflated. Of the remainder: 14% were ‘very dangerously’ under-inflated by more than 14psi, 24% were ‘dangerously’ under-inflated by between 8 and 14 psi, 15% were deemed to be ‘temporarily acceptable’ although they were under-inflated by between 4 and 7 psi and 8% of the tyres checked were over-inflated.

New ECOlogical driving test set to win over cost-conscious businesses

An ECOlogical driving test, establishing a motorist’s fuel ECOnomy and crash avoidance skills, has been launched this month (September) in the UK.

It is believed to be the first-ever ‘cash-saving at the wheel’ qualification and toughest-ever test of vehicle control for experienced car and van drivers.
  
Privately developed and operated - with a major insurer’s blessing and closely watched by Whitehall - the test’s backers hope that it will become an employment qualification highlighting that an individual is a first-class driver.

 The voluntary 90-minute test provides a Certificate of Professional Competence (CPC) and only truly safe-defensive environmentally-friendly drivers will pass.

Costing £160 the Eco-Advanced Driving Test includes every type of road situation to prove a driver:

• Cuts fuel consumption to at least 15% below their vehicle’s official average
• Reduces damage incident risks and vehicle wear and tear by up to 60%
• Merits maximum vehicle insurance discount

Setting a new 21st century level of advanced driving, the test is targeting over 20 million UK business and vocational car and van drivers and their employers.

Test creators the Stafford-based Approved Driving Instructors’ National Joint Council and the Croydon-based Driver Education Research Foundation say the £160 test cost "will be amortised in weeks to then be permanently profitable for all successful candidates".

It is an established fact that care at the wheel cuts vehicle operating costs, fuel use is reduced, exhaust emissions are slashed, tyre and brake wear drop, fewer replacement parts are required, servicing costs are minimised, and vehicle life is extended.

Additionally, a carefully driven vehicle fetches more on resale because it looks, feels, and is better than an uncared for equivalent.

DERF director Professor Peter Russell says that eco-qualified drivers will prove to be attractive to employers as they continue to look to minimise business vehicle running costs. Already, it is claimed, that a major supermarket chain is ‘keenly interested’ and it is believed that many employers could quickly demand that their work drivers be ‘Eco Certified’.

And it is possible that vehicle insurers will encourage companies, or at least ‘risk sensitive’ businesses, to employ Eco-qualified drivers.

Professor Russell, one of Britain’s leading authorities in driver training and testing, added: “Successful candidates will be the top 10% of Britain’s business drivers. The test could spread abroad.”

Emission-based changes ahead for London congestion charge?

Revisions to the London congestion charge could take place that will see the fee linked to a vehicle’s emissions and not the technology powering the model.

London Mayor Boris Johnson has agreed to review the capital’s congestion charge exemption for alternatively-fuelled vehicles in the wake of a challenge from vehicle manufacturer Volvo.

The car company is concerned that hybrid vehicles are exempt from the congestion charge, but models powered by conventional internal combustion engines are subject to the £8 daily charge even though, in many cases, emission levels are lower.

The ‘tax’ could add a financial burden of over £2,000 per year to those drivers who have selected a traditionally-powered low emission car, says Volvo.

London congestion charge exemption has been one of the powerful ‘sales’ tools used by motor manufacturers Honda, Lexus and Toyota - the three car companies currently selling hybrid cars in the UK.

And now with all motor manufacturers racing to introduce low emission vehicles to the UK market using a range of technologies, the Mayor’s final decision could be crucial in playing a part in influencing fleet company car policies.

For example, while Volvo and a wide range of other carmakers are highlighting their petrol and diesel emission-busting cars by branding the models - BMW calls its EfficientDynamics, Mercedes’ BlueEFFICIENCY, Volkswagen BlueMotion, Ford ECOnetic, Vauxhall chooses ecoFLEX, Renault eco2 and Peugeot Blue Lion - plug-in hybrids and diesel hybrids are also on the agenda.

In calling for congestion charge changes Volvo highlighted that hybrid-powered cars currently have CO2 emission outputs ranging from 89 g/km to 219 g/km. However, What Car? magazine's Green Car of the Year, the S40 1.6D DRIVe with Start/Stop technology, emits 104 g/km yet drivers are charged £8 to enter the capital. Similarly, Volvo’s DRIVe C30 SportsCoupe and V50 Sportswagon models also emit 104 g/km but none of them are exempt from the charge.

Mr Johnson has told Volvo that the exemption to the congestion charge was introduced to incentivise the take-up of more environmentally-friendly vehicles.

However, he said that he now recognised that vehicle technology had developed considerably since then and, as a result, Transport for London would review the exemption and report its recommendations by the end of the year.

Volvo’s belief that the charge unfairly favours hybrid cars over other low-emitting vehicles comes at the same time as a poll by What Car? magazine confirmed that the motoring public also believe that the current hybrid and electric car exemption is outdated and unfair.

In the poll, conducted on the homepage of WhatCar.com, 50% of over 1,500 respondents confirmed that they believed that any exemption should be CO2-based while 34% believed that the status quo, where all hybrid or electric cars are exempt, was fair.