A new online vehicle wholelife cost operating tool for fleet decision-makers has been launched by automotive industry data provider Derwent Management Services (DMS).
Called TotalCost, it enables fleets to accurately make budget predictions relating to the wholelife costs of cars and vans across their operating cycle.
Already being used by motor manufacturers, contract hire and leasing companies and fleet management specialists, TotalCost is now available to fleet decision-makers for the first time.
Too frequently, wholelife cost calculations are based on funding costs such as hire purchase payments plus the cost of fuel. Such simplicity, often forgetting maintenance costs, says DMS, fails to accurately reflect the true operating cost of vehicles which can have a significant impact on budget forecasts.
Jeff Edgar, director of business development at DMS, said: “TotalCost takes account of every single financial figure applicable to a company car and van during its corporate life and enables fleet decision-makers to build a truly complete cost picture.
"TotalCost is a budget prediction tool that is available to SMEs for perhaps occasional use and to major Plcs that have a fleet department and require wholelife cost information on a daily basis. Wholelife cost figures can be calculated on a pence per mile basis, cost per month or annual basis.”
Real world data
With TotalCost, the most influential factors - depreciation, fuel and SMR – are based on real world information.
Resale value data is derived from the DMS Insight Survey - the company’s contract hire industry-leading tool for assessing residual values which is compiled from data supplied by all leading contract hire and leasing companies.
DMS takes the average from 15 mileage profiles ranging from one-year/20,000 miles to five-year/150,000 miles on all cars and light commercial vehicles and uses the resultant depreciation curve to enable fleet decision-makers to analyse values at age and mileage intervals of six months/5,000 miles.
“This enables fleet operators to obtain a very genuine depreciation curve for any vehicle as to how the market in real life views any particular model,” explained Edgar.
Servicing, maintenance and repair costs (SMR) are based on the company’s own SMR Cost Analysis programme, which is now used by more leasing companies than any other tool to calculate their SMR budgets.
SMR Cost Analysis uses manufacturer parts pricing and labour times for services and common replacement items to calculate actual running costs.
With the additional purchase of this separate tool, users can choose whether or not to change default replacement intervals for tyres and all wear items.
They also have the ability to enter their own labour rates, oil prices, parts and labour discounts to further reflect their fleet profile.
Additionally, DMS uses another of its recently launched tools, SMR BurnRate, to enable fleets to factor in real world replacement rates and costs for a basket of 63 components including wiper blade replacement, break pads, brake discs and tyres based on data gathered from the contract hire and leasing industry compiled across more than 300,000 company cars and vans and some 4.3 million ‘incidents’ of part renewal.
TotalCost incorporates all vehicle list prices with fleet decision-makers able to build in their own financial terms on a manufacturer, model or derivative basis.
Additionally, national average fuel prices are updated daily with businesses able to include in their wholelife cost calculations a financial split between business and private mileage.
Other factors that TotalCost takes into account are: corporate taxes including writing down allowances, finance costs, short term vehicle replacement, Class 1A National Insurance costs, Vehicle Excise Duty, MPG, CO2 emissions, insurance costs and benefit-in-kind tax.
Edgar said : “Fleet operators can choose which factors they include in their calculations, but savvy decision-makers will take account of all the information available to them to build up the most accurate whole life cost picture of their vehicles thus enabling fully informed budget forecasts to be made.”
DMS TotalCost is accessible online following the purchase of an annual licence. Cost is dependent on functionality required, the number of licence holders and size of fleet.