Fleet Management Update – April 2018
Commercial Leasing & Fleet Management Since 1955
April 2018 - We hope you will find our monthly Fleet Management Updates useful. Please feel free to call us or leave a comment below regarding any questions you may have about the newsletter or subjects you would like us to include in future months. We invite you to sign up at the bottom of this newsletter page for future Fleet Management Updates to be sent directly to your email.
SCOTT SMITH President
GT Leasing | 904-398-5000 | 2810 St Augustine Rd | Jacksonville | FL | 32207
If you continually ask yourself,
“What’s important now?, you won’t waste time on the trivial.”
What IS important now? Here is the issue that is currently the top of the list item for our staff fleet managers.
By the end of this month all the deadlines to factory order a vehicle will have come and gone. This puts us into a period over the next 2 to 4 months where we are constantly balancing buying vehicles for clients out of inventory (often at not the optimal price or equipment) or advising them to order and wait until the 2019′s arrive.
This can be a tricky time and requires some guess work and a lot of knowledge about new products, resale, and what the manufacturers are going to do with CAPS program numbers and the list goes on and on. Not helping is the complex period this Fall with new pickup intros by GM and Chrysler an overlap of the old models for a period of time. Big questions to answer with a lot of variables.
A handful of our customers have a dedicated person or dept to deal with these types of issues but the vast majority at best have a purchasing agent dealing with the company vehicles as a side task. Actually, a high percentage have the CEO or CFO handling the task.
The information to make the best choices requires a great deal of effort and information about your current fleet, the used market, the manufacturers vehicle introduction schedule, dealer inventory, the competitive market between manufacturers, their marketing initiatives (rebates), and factory schedules.
Just one aspect of the decision, such as what will the rebates be for the CAPS programs on the new model vs the old model can easily mean a couple thousand dollars alone. When you stack up all the variables it can add up to some serious money on every vehicle.
Clients with a dedicated professional or even a dept have pretty much got their answers and only need information on what inventory is actually available on the ground. It goes without saying that everybody can figure this out given enough time and effort, however we generally can come up with a very good answer for you in a short period of time. Call us and we will discuss your situation and suggest the best solution for your vehicle needs over this tricky next few months.
Our objective in these newsletters is to keep you informed on fleet issues and new products so that you can keep your transportation costs in line. We hope you enjoy the information below and will call us with any questions or needs that you might have regarding your next vehicle.
CALL US AT 904-398-5000
SCOTT SMITH President
Auto shows are rarely surprising, but the 2018 New York Auto show was genuinely exciting. It’s a big show for debuting cars that real people buy — not supercars or exotics, but affordable crossovers and cars from mainstream brands.
Here is a countdown for the five best debuts:
5. 2019 Hyundai Santa Fe/Lincoln Aviator Concept
Fifth place is a tie between two very stylish crossovers. The Hyundai Santa Fe debuted with upscale aspirations, three engine options (including a diesel), and a ton of new tech. The Lincoln Aviator is just a concept, but it looks production read with a very Range Rover-inspired stance and a beautiful interior. This hybrid V6 luxury CUV is exactly the kind of product Lincoln needs to bolster its revival and a production version should debut sometime later this year. More Info Click
4. 2019 Nissan Altima
With the excellent Honda Accord and Toyota Camry that came out last year, the Altima was falling behind. But Nissan has fixed that problem. The new 2019 Altima leaps ahead of its competition by offering all-wheel drive for the first time, something the Accord and Camry don’t have. The family sedan gets a fresh new style and an optional VC Turbo engine, a high-tech new offering that will help both performance and fuel economy. More Info Click
3. 2019 Toyota RAV4
The 2018 RAV4 sold over 400,000 copies last year, with the model enjoying double-digit sales growth in the process. It’s particularly impressive because that tally came for an outdated model nearing the end of its life. In fact, that massive sales figure suggests that this new fifth-generation 2019 Toyota RAV4 is very likely the auto industry’s most important new vehicle to debut at this week’s New York Auto Show. More info Click
2. Volkswagen Atlas Tanoak/Atlas Cross Sport Concept
This was a refreshing pair of concepts from VW because they weren’t part of the I.D. family of design studies that are too far out to get excited about. This pair of Atlas-based concepts look almost ready for production. With the Tanoak, VW is testing the reactions to see if a pickup truck will be popular. More info Click
1. Genesis Essentia Concept
This gorgeous concept car was a huge surprise. No one knew it was coming and Genesis did a smart thing by not teasing the debut, which paid off because the element of surprise plays a huge role in stealing the spotlight at an auto show. This sleek concept is how Genesis envisions an all-electric luxury grand touring coupe. Genesis will be coming out with a sportier model soon, and we’re excited to see how this concept’s design will influence a production model. The Essentia Concept was easily the most stunning and surprising debut of the whole show. YouTube Video
Here is some additional vehicles and opinion from the rest of the Big Apple Show.
Motors powertrain chief Dan Nicholson takes automakers’ case for a single, higher-octane gasoline standard to Congress on Friday (April 13) when he speaks before the U.S. House Energy and Commerce Committee.”We’re optimistic – there’s never been a better time for it,” Nicholson tells WardsAuto following a panel discussion on the future of internal-combustion engines here at the SAE World Congress Experience.
Nicholson, vice president-GM Propulsion Systems, delivers the automakers’ plea to boost the regular-fuel octane level to 95 RON on behalf of the U.S. Council for Automotive Research, a consortium that seeks to strengthen the U.S. auto industry through cooperative research and development.
Higher octane makes gasoline more resistant to compression ignition, or knocking, which can damage engine components. The higher standard would allow automakers to gain more efficiency from ICEs through higher compression ratios needed in today’s smaller-displacement turbocharged and supercharged engines.
Nicholson is among at least eight speakers addressing Congress on the issue, including representatives from the fuel industry who are working with automakers in the push for a single octane rating. In the past, oil refiners have been resistant to octane increases because of added costs. Representatives of fuel distributors and the fuel station industries also are presenting to Congress.
Nicholson says the estimated 3% higher cost of what essentially would be premium fuel will be directly offset by a 3% gain in fuel efficiency. He notes octane ratings of 95 and above have been common in Europe for decades.
Fellow SAE panelist David Filipe, Ford vice president-Powertrain Engineering, agrees the time has come to introduce higher-octane fuel as the U.S. standard. He says the increase in cost for higher-octane fuel is estimated at 5 cents per gallon over current 87 RON unleaded regular.
Here are some thoughts and trends resulting from “Last Mile” innovations that are incrementally changing the fleet industry. LAST MILE or FINAL MILE is a term used in supply chain management and transportation planning to describe the movement of people and goods from a transportation hub to a final destination in the home. This last leg of the supply chain is often less efficient, comprising up to 53% of the total cost to move goods.
Already, technologies such as compressed natural gas, liquefied natural gas, propane, hybrid and some electric vehicles are in operation. However, the population is very small and has remained so for many years, because they are mostly in niche application such as buses and small delivery trucks. OEMs have not heavily pursued alternative power vehicle production and customers aren’t necessarily willing to buy these vehicles in large numbers, so there are few economies of scale to be had.
The various hybrid and electric vehicles from the past decade or so, most of which are no longer around, took government incentives to help develop and deploy them. Something different is happening now. The change is really coming from the needs of the urban areas, this is where the bulk of last-mile activity happens. City governments are increasingly putting into place policies and regulations to address problems with congestion, air quality, and noise pollution, creating a demand for these technologies. At the same time we are seeing that the economics are starting to be positive in some applications. That’s already happening for urban buses and should be the case for medium-duty delivery vehicles by early in the next decade.
Charging is a big challenge and without extensive electric charging infrastructure, it’s a lot harder to carry the energy with you that you’d like to have. Fast-charging systems can reduce battery life. There’s no standard for charging connections. And there are real estate challenges. While commercial vehicles consume between 0.8 and 2.5 kWh per mile, their batteries are expected to store between 50 and 500 kWh.
The charging needs alone will affect the layouts of shops and fleet yards. “The vehicles actually need to sit by the charger, and quite often the electricity and the available charging isn’t in the same spot. To compound matters, there are already four different styles of connectors for the vehicles, and they are not all compatible with one another.
With all that, don’t expect internal combustion engines to disappear anytime soon, and in fact predicted increasing use of hybrids to allow for vehicles that can run on electricity in the cities but have extended range for operating outside of low-emissions zones. There will be increasing activity to work to develop fuel cells, because that allows us to carry more energy with us.
Maintenance challenges with alternative powered last-mile trucks
There are a number of challenges when it comes to maintenance of alternative fuel and powertrains, noting that there have been improvements in some of these areas in recent years:
- Tooling availability
- Facility design
- Charging infrastructure
- Willingness to invest
- OEM support
The good news is we expect there to be less maintenance for battery-electric vehicles. There are simply fewer parts to maintain or repair. Hybrids, however, can do the opposite, adding systems that mean more things to break down – although a well-integrated hybrid system can reduce stress in some parts of the drivetrain, he said, noting that many hybrids in the past created a lot of maintenance headaches. Newer systems may benefit from better engineering as well as from sensors and sophisticated onboard diagnostics that weren’t around for early generations of hybrids.
|AUDI RS6-R AVANT WAGON|
TOP DOG TRUCK BATTLE ROYALE – SILVERADO F150 RAM
There is a great battle brewing in Detroit with huge implications for the Big 3. Over the next six months, you are going to see a collection of trucks that showcase some of the most sophisticated technologies each manufacturer has in its arsenal.
So just take your pickup buying strategy you have depended upon in the past and chunk it out the window. These changes are going to make the selection process for buyers a whole lot more complex. Standard Equipment, Available Options, Base Prices are going to swing wildly over the next 12 months.2019 Silverado Preview.
Ford has long set the pace by continually introducing new technologies, increasing towing and hauling capability, adding luxury features and carving out new segments – a playbook that has kept the F series on top of the sales charts for 41 years. The 2018 model F150 was a giant leap even for the segment leader.
Now RAM and GM enter the fray with the redesigns of the Chevrolet Silverado and RAM pickups taking center stage at the Detroit auto show this week. They are impressive and both tear not just a page or two out of that pickup playbook of most buyers, but whole chapters.
The Silverado debuts an industry-first fuel-saving technology and perhaps the most advanced construction process used on a pickup. Ram introduces a giant, Tesla-like touch screen to a luxury-style interior, along with a long list of technical upgrades.
All this comes at a price. There’s no doubt that these new trucks will cost more than the outgoing models and that is where the commercial fleet buyers will need all their focus on obtaining what you need and taking advantage of some new touches for the best use of your dollars. We can provide all the information with the task and save you a lot of time, money and maybe some costly mistakes.