At a glance
Consolidating pan-European fleet operations throws up a range of problems:
Taking over the fleets of acquired companies presents a challenge. But taking over fleets of acquired companies spread across Europe can be a nightmare.
Such a problem faced Aidan Godfrey, purchasing director for electronics firm Thales, after it acquired a number of firms around Europe.
By the time the acquisitions were over, Thales – then known as Thomson CSF – had dozens of companies across 14 European countries, a fleet numbering 3,800 vehicles, many different in-house fleet management resources and 11 different leasing providers.
The fleet featured almost every manufacturer and the running costs were virtually impossible to determine.
Mr Godfrey had quite a mountain to climb to establish an international fleet. The first step was to establish a preferred manufacturer, but there were immediately cultural problems.
The German drivers had few problems with the idea of restricted vehicle choice, but in France, user-choosers made up the bulk of the 1,000-strong fleet, and the idea of introducing vehicle choice had the local human resources department fuming.
Additionally, there was a strong loyalty to French marques, unlike in the UK where Ford dominated the 3,400-strong fleet.
Mr Godfrey says: “Thales is not a mandatory organisation, but the economic benefits garnered from establishing preferred suppliers were compelling.”
The eventual solution was a dual-marque approach. Thales went with Ford and its Premier Automotive Group (PAG), a deal that included prestige vehicles, alongside contracts with the Volkswagen Group and Renault.
The next step was to find a fleet management partner that could consolidate the disparate fleet management initiatives.
Mr Godfrey rationalised the leasing companies and held a tender with the suppliers able to offer pan-European capabilities.
“The most important factor in the decision for us was trust – trust that the provider would offer a true global presence and be able to deliver on its promises. A lot of leasing providers talk global but act local, and that would not have met our needs.”
The eventual winner and sole leasing provider was Arval. A pan-European agreement between Arval, Thales and the carmakers, which ensure preferential support terms provided to Arval by the manufacturers, in return for a guaranteed volume of vehicles being ordered by Thales.
Work started on establishing a database of every driver and vehicle, which brought a better understanding of the scale and nature of the Thales’ fleet and a better analysis of management information from sources like fuel cards.
The completed database allows the huge fleet to be viewed as a whole and by country.
Arval can now monitor the mileage of each vehicle and advise Thales on the best time to renew contracts.
It can also enable spare vehicles to be reallocated between Thales businesses in a particular country.
Increased understanding meant streamlining – Mr Godfrey was able to slash the time taken up by fleet matters.
Vehicle provision was made much easier by implementing one single system across all Thales’ companies, which required just one sign-off from HR departments in each country.
The system led to a shift towards fleet management outsourcing. Each Thales organisation has just one point of contact for fleet.
“We are much leaner and better as an organisation now and can concentrate on our core commercial competencies rather than using time and resources on fleet concerns.”
A policy on vehicle selection was developed that linked variety of choice to business grades.
A website was specifically created for employees to choose and order their vehicles.
Through the information from service, maintenance and repair records, as well as regular reviews, potential problem drivers could be identified, and using a single provider for commercial vehicles enabled Thales to bring in standard procedures on racking and other modifications.
Consultants were also brought in to give an independent view of Thales’ fleet operations.
“Looking at driver behaviour and taking into consideration the different tax and other legislative concerns in each country, we have been able to identify areas for attention. In France, the consultation produced a range of improvements worth more then €500,000 a year.”
Following the success of the European partnership, Thales and Arval are now expanding their relationship to cover operations in Scandinavia, Africa and the USA.
In Europe, Mr Godfrey’s ambition is for even better forecasting of costs and budgetary controls.
“Today, a fleet of several thousand vehicles is all but operated by a handful of people,” he says.
“We have a single fleet provider, a database that manages every driver and vehicle and a dual manufacturer policy; efficiencies that have delivered significant savings across the fleet year-on-year. Our relationship has allowed Thales to deliver significant cost and service delivery improvements, but we cannot stand still. Our challenge now is to identify and implement a new generation of improvements over the next few years.”