Fleet News

IT&E conference report: Time for an e-fleet world

AN online fleet future is beckoning and promises to offer real time and money savings. Jonathan Manning reports from the recent Fleet News IT&E conference.

Audi offers internet calculator to alter CO2 data for each car

AUDI has developed an exact carbon dioxide calculator for its online ordering system so that company car drivers do not suffer any unpleasant tax surprises when they take delivery of their new Audis.

The facility automatically alters the CO2 emissions of an Audi car as the fleet customer configures the vehicle through the options list to an exact specification.

As a result, specification enhancements that increase the CO2 emissions of the car are immediately visible on screen so the user does not expect one CO2 score based on a brochure, only to find the car's V5 registration document (the only source the Inland Revenue will accept for CO2 data) is higher.

Mike Embleton, Audi corporate services manager, said: 'What tends to be happening in the industry is that fleets are ordering a car and taking the CO2 data from the Vehicle Certification Agency or leasing company, which is based on the base model, so when the car arrives its CO2 rating is higher and it could trip the driver into a different tax band.'

Volvo notably had problems last year when cars arrived in the UK with CO2 emissions on their V5 documents significantly higher than those marked in printed marketing material, leaving at least one company director angry and dismayed to be facing a higher than anticipated tax bill from April 6, under the new company car tax rules.

Audi's printed materials include the weights of specification enhancements and information about how to calculate the CO2 impact of adding various optional extras, and this process has been automated online.

'Right from the beginning we set out to provide the absolute CO2 emissions of a car,' said Embleton.

Last year Audi received almost 6,000 fleet orders via its electronic ordering system, and believes that could rise to between 7,000 and 8,000 units this year now that the application is web-enabled.

The facility is open to all fleets, although particularly appropriate to national fleets (and especially leasing companies) buying at least 30 Audis a year. New features include the ability to track order status and histories, and investigate any stock cars available at dealers anywhere in the country, potentially helping to reduce order lead times.

Orders are passed directly from fleet to Audi UK to the factory, and Audi then appoints the supplying dealer (based on the driver or fleet post code) who receives a commission and carries out the pre-delivery inspection for a fee.

Motability sees savings from e-fleet processes

ONLINE service and maintenance authorisation has created staggering efficiency gains at the UK's largest fleet, Motability Finance Limited.

The operational arm of disabled motoring charity Motability now has service and maintenance responsibility for its huge fleet that now approaches 400,000 vehicles.

These cars would require typically 800,000 service and maintenance transactions in a year - half of which are handled by six people, while the other half are handled by 36. The phenomenal difference is due to the efficiency delivered by Translease, the automatic authorisation system.

Jeremy Martin, MFL's programme manager, said: 'We found SMR authorisation was costing us about £15 to £20 per transaction, often for work costing an average of £70. That figure will reduce to less than £2.50 per transaction by 2003 by using Translease.'

MFL has also placed online links at the heart of its remarketing operation - responsible for selling more than 500 ex-contract cars every day.

Indeed, last month the organisation stopped telephone selling its end of contract cars, effectively obliging buyers to go online to search for stock.

'The first week after we stopped tele-selling we did not sell a single car,' said Martin. 'In the second week our sales were back to what they were before.'

MFL will maintain its call centre to motivate used car dealers to go online and search its stock but is already noticing sharp differences to traditional buying patterns. In addition, the 'virtual online showroom' is allowing dealers to seek a specific car to meet a customer's needs, without the financial risk and cash flow disadvantages of carrying stock.

Buyers enjoy the further peace of mind that they can return cars they have acquired unseen, should the vehicles fail to meet their internet description, although three colour codings - platinum, gold and silver - give buyers a strong indication of the condition of the cars.

GRS warns fleets to differentiate between trade and private buyers at disposal time

FLEET disposal managers responsible for selling ex-company cars must make a clear distinction between trade and private buyers when using the internet to dispose of cars.

Remarketing specialist GRS, which runs its own online stock locator, has identified significant differences in the attitudes to sourcing cars online between trade and private buyers.

GRS sales and marketing manager Mike Pilkington believes trade buyers will be increasingly happy to source cars unseen, but said private buyers will use the internet merely as a pre-acquisition research tool. He cited figures from the United States that suggest only 2% of pre-owned cars are bought on the web, but 40% of buyers research their purchase online. Research into the prejudices of private used car buyers indicate that many fear 'buying a lemon' online, and prefer to purchase a car from a retailer who can also offer some aftersales security.

'The internet is not a viable sales channel for fleets to sell to retail customers,' said Pilkington.

But using online routes to reach trade buyers is a different matter, with 82% of motor retailers now apparently having internet access.

As an example of the discrepancy between retail and trade attitudes, Pilkington cited the experience of Vauxhall, which has only sold about 1,000 brand new 'dotcom' models to private buyers via the internet, yet last year sold 20,000 used cars to its dealers via an intranet site.

'The internet is a very powerful marketing medium reaching more than 80% of the trade, it represents an opportunity to capture data, and it allows you to start a dialogue with potential customers,' said Pilkington.

'Vendors should use the internet to sell the whole proposition, such as full service histories and guaranteed condition standards, not just the cars.'

And he emphasised the importance of vendors maintaining relationships with buyers, if only by telephone, because the culture of the motor trade is one of personal contact and price negotiation, neither of which the internet can deliver.

ARVAL to offer real-time fuel management

FLEET fuel card specialist Arval PHH is moving towards online authorisation of every fuel purchase made with one of its cards to improve security and management information for its clients.

A number of petrol stations owned by oil companies have already introduced the technology to conduct online authorisation and Arval PHH is now trying to encourage franchise and independent filling stations to adopt the same technology.

Roger Bazley, sales manager in Arval PHH's fuel division, said online authorisation would give fleets immediate control of their fuel expenditure, rather than the reactive control currently available through management reports.

For example, fleets could set maximum parameters that prohibit a driver from filling up more than twice in one day, or purchasing more than a certain volume of fuel in a day.

If the fuel card user tried to exceed these limits, the purchase would be blocked by the online system.

Exception reports allow fleets to identify such instances today, but only retrospectively.

In addition, online authorisation will be able to reject purchases where the driver submits incorrect mileage information (perhaps because the mileage offered is below the previous purchase or too far beyond it), improving fleet capture of mileage data.

'Online authorisation reduces the risk of fraudulent card use for both Arval PHH and for oil companies,' said Bazley.

'It allows us to deal with purchases in real time, and by the end of this year the majority of our refuelling network will have online authorisation and bring greater control to purchases made through fuel cards.'

The talking is over as BT's fleet works online

THE BT advertising mantra used to be 'it's good to talk' but in the fleet department of the telecommunications giant, much of this 'talk' is now silent and online.

BT Fleet Partners' internal company website now carries 1,500 pages of useful information, including a company car tax ready reckoner for potential cash-for-car customers, and receives more than one million hits per month.

It also receives more than 1,000 service appointment bookings every month, takes orders for 900 new company cars per month, and operates an interactive car reallocation facility.

With a fleet of 57,000 vehicles, BT Fleet Partners has rapidly seen the service and efficiency benefits of exploiting the internet and intranet.

As early as 1998, the fleet operation introduced paperless car ordering, with drivers able to select their next company car based on its true specification and their lease allowance.

The web-based system also allows drivers to search for their next car via a series of flexible criteria, such as listing all two-door coupes.

'It used to take 14 days to select and order a company car, in terms of the time processing it and the time taken for the driver and manager to go through the authorisation process, yet 80% of the orders were still incorrect,' said Janet Entwistle, general manager of BT Fleet Partners.

Now the IT system ensures drivers can only select cars to which they are entitled and automatically seeks authorisation, delivering huge efficiency gains.

It's a similar story with service booking, with drivers now able to email a convenient time and garage to have their vehicle serviced, and the fleet department able to match the requests to workshop rosters and then confirm the appointment.

For organisations looking at web-enabling their fleet processes, Entwistle said it was vital to keep websites up to date and easy to navigate, and preferably to make the site compulsory to use.

'You would not send out a five-year-old brochure to your drivers, so keep your web information fresh,' she said.

E-procurement can offer fleets real cash savings

E-PROCUREMENT can save the equivalent of as much as £10 per month from a typical car lease, according to Tusker Direct.

But Tom Stephenson, joint managing director of the company, argues that efficiency gains of this magnitude will only be available from completely web-enabled businesses.

He dismissed the web applications of many traditional contract hire companies, claiming they had simply bolted on an internet 'front-end' for quotes and reports. A genuinely web-enabled business, however, creates the paperless electronic links between a driver or fleet executive reviewing lease rates online, selecting a vehicle, passing the order to the leasing company, and subsequently creating fleet management reports online.

These e-processes can free fleet executives from time -consuming, mundane functions, affording them time to focus on value-added areas of their jobs.

'79% of fleet managers spend more than half their time on driver issues, which is non-value added time,' said Stephenson.

He cited Tusker Direct's policy of giving each driver his or her own web page as a key example of how the internet can free fleet executives from administrative tasks. The individual web page contains information on when and where to get a car serviced, but adds useful information such as a car's radio code.

This personal page can be customised so that employees selecting their next company cars can access choice lists specific to their own entitlements.

'Our research found that more than 50% of fleet managers said that between 90% and 100% of their drivers have office access to the internet,' said Stephenson. 'It's no longer possible to argue that fleet managers are not ready for e-procurement - it can save £10 per month per vehicle from a monthly rental.' An e-linked future is 'tantalisingly close', says Kwik-Fit Fleet

FORWARD-looking fleets should envisage a day where every element of the supply chain from car to garage to leasing company or purchasing department is e-linked.

These connections are now tantalisingly close and will deliver huge efficiency dividends and service enhancements, according to Kwik-Fit Fleet. The company has already established certain online links in the supply chain, but has warned that the real wins will come with complete e-linked processes.

Simon English, director of Kwik-Fit Fleet, said: 'While online booking is extremely convenient in many cases, in reality it does not save massive amounts of time, and online invoicing in isolation saves little money unless your systems handle processing and payment automatically thereafter.'

He believes the ultimate online solutions will see in-car black boxes communicate a car's requirements to an automated central office, generating a service booking and prompting the authorisation and invoicing process. And in a further development, pre-emptive diagnosis from engine management systems will see cars communicate developing faults with central offices that will then contact the driver, informing him or her of the problem.

CFC system set to transform fleets

NEW technology will transform the day-to-day duties of fleet management from an active to a passive task.

In March, Car Fleet Control will introduce a 'passive' IT management system that will automatically capture information from a driver or vehicle, and only notify them when work is required.

'We believe it's the start of a completely new way to manage vehicles,' said Jason Francis, managing director of Car Fleet Control. He said CFC was already piloting the system with a small fleet of 50 vehicles, and that the applications for benchmarking vehicle running costs and intervening when problems or exceptions are identified will revolutionise fleet management.

'During economic growth there is not so much pressure on businesses to reduce costs, but in an economic downturn there is severe pressure to reduce costs,' said Francis. 'E-commerce represents the most significant change in the business world in our lifetime.'

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