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Cost savings likely to dominate fleet agenda in 2019

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Cost savings will be a top priority for fleet operators this year as organisations look to contain their spending, says FleetCheck.

Economic uncertainty and the ongoing effects of Brexit is expected to force firms to find new ways to reduce costs.

“We are entering a very unusual time where politicians’ inability to satisfactorily resolve the Brexit situation is leading us into a largely self-generated economic slowdown.

“In this situation, all kinds of organisations are starting to batten down the hatches and put the brakes on spending in many different areas – and this will undoubtedly affect fleets,” said Peter Golding, managing director of FleetCheck.

In the second half of 2018 businesses began to implement measures such as limiting travel to essential journeys and lengthening replacement cycles, with the latter exacerbated by WLTP and company car tax.

For most fleets, the fundamental policies affecting expenditure had been formulated during the 2007-09 recession.

“A lot of obvious cost savings were made at that time, ranging from cutting the numbers of staff working on the fleet through to vehicle downsizing, and those measures are generally still in place. If organisations want to make savings, they need to think creatively,” explained Golding.

Areas that fleets might investigate include alternative fuels, increased use of OBD telematics and better scrutiny of data. Measures that weren’t available during the recession.

“As a fleet software company, we are having conversations with fleets about ideas such as these and ways in which they can be applied to contain and reduce fleet costs.

“Our view is that it is often impossible to put these measures in place without the kind of technology that we provide and, even where it can be done, products of the type we provide are needed to see whether savings and other improvements are being made.

“Without the right tools, you cannot properly track whether sophisticated ideas such as these are having the desired results or see what changes are needed to make them work,” Golding said. 

He added that one of the oddities of Brexit was that the situation could change very quickly if positive decisions could be made at a political level.

“The fundamentals of the economy appear to be quite sound and, if Brexit outcomes are created that satisfy businesses, the flow of investment and spending could be reversed quite quickly and cost pressures fall down the fleet agenda in a matter of weeks or months.”

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