How to Determine What Size is the Right Size
Rightsizing is more than simply utilizing smaller displacement engines or vehicle downsizing. It involves ensuring the optimal number of properly spec’ed vehicles are available for fleets to fulfill their mission.
In an era of ever-tightening fleet budgets, “rightsizing” has become the go-to strategy for squeezing greater cost-efficiencies out of vehicle fleets, without diminishing service to customers. But, achieving the proper equilibrium between vehicle inventory and service levels is often easier said than done, because rightsizing is never a one-time job. As the needs of the business change, so do vehicle requirements. How do fleet managers determine what exactly is the “right” (that is, optimal) size for company fleets at any given time?
The starting point is to define what exactly rightsizing means at a big-picture level. It doesn’t simply refer to downsizing or eliminating vehicles out of a fleet, though that could be part of the plan.
Instead, the operative term when describing rightsizing is “optimal.” What is the optimal number of vehicles for the fleet to properly support the organization’s customers? No more, no less. Any vehicle not fulfilling its purpose is fair game for reallocation to another region within the organization or elimination from the fleet altogether.
However, rightsizing isn’t just about maintaining the right number of vehicles in inventory, but also selecting the rightsized vehicle in terms of class, capabilities, and specification. For example, when Randy Burwell, lead buyer and fleet specialist for for Valero Energy Corporation, began transitioning the company’s sedan fleet from the V-6 Ford Taurus to the smaller four-cylinder-powered Ford Fusion in 2009, the fleet achieved savings as much as 6.5 cents per mile for each Taurus replaced by a Fusion.
Amy Blaine, director of strategic consulting and sustainability with Northbrook, Ill.-based fleet management company, Donlen, has seen similar savings with fleets that have shifted to smaller-spec, lighter-weight vehicles.
“We have had some customers move from a truck to SUV or from an SUV to a car. But, even if they are in a car, they may shift from a larger sedan to a smaller sedan,” Blaine said. “The key is getting them into a vehicle that is lighter weight, which drives improved fuel economy, often at a lower capital cost of the car, reducing overall vehicle cost in the system.”
Yet, rightsizing vehicle specification doesn’t always equal downsizing. In some cases, fleet managers need to spec a larger vehicle for the job to ensure optimal productivity.