Replacing Vehicles May Produce Cost Savings, According to PHH Arval Sales Fleet Forum
April 24, 2012
Mississauga, Ontario (April 24, 2012) – In today’s economy, fleets are having to do more with less, and are focused on cost savings. This was a theme PHH Arval addressed at its recent semi-annual Sales Fleet Forum.
With the price of fuel hitting $1.40 per litre in many Canadian cities, Denley Phillip, PHH Arval Senior Consultant, New Vehicle Acquisition said, “the horsepower race in automotive manufacturing is evolving quickly to become the fuel economy race,” as vehicles are being engineered to require less fuel.
While fleets could realize a cost savings through more fuel efficient vehicle decisions, PHH recommended analysis to determine whether accelerated vehicle replacement is a viable savings opportunity. Fleet professionals should consider:
- How much is budgeted for replacing units for the remainder of the calendar year?
- What is the goal for replacing vehicles? Is it:
- To reduce costs of maintenance and/or depreciation expense?
- To take equity out of the vehicles?
- What segments, makes, models should be sold first using current values, remaining book values, anticipated mileage thresholds and budget restrictions?
Twice a year, PHH Arval facilitates Forums to discuss issues such as these. The events are for fleet professionals across PHH Arval’s client base to provide networking opportunities and discussions relative to the vehicles and policies they manage. Fleet management data and information is shared among group members, and attendees have an opportunity to understand how similar fleets operate.
During the recent Forum, Tim McGee, PHH Arval Manager of Vehicle Remarketing looked at what vehicles to buy today for better resale tomorrow, and provided perspective on the overall marketplace. He said there will be:
- A gradual return to normal production levels from all manufacturers;
- More trade-in vehicles in the market place;
- Increased demand for used vehicles; and
- Older used vehicles, which extends odometer and quality concerns.
Additionally, Baljit Kang, PHH Arval Senior Consultant, New Vehicle Acquisition presented information on the new models and refreshed vehicles planned for 2013. He reviewed several makes and models of cars across various sales-fleet selector levels, and addressed differences such as vehicle size, weight, aerodynamics, and maximized use of interior space, in vehicles originally designed for European or Southeast Asian markets.
For additional information, see a recent PHH Arval Remarketing webinar that looked at remarketing both in Canada and the United States.
About PHH Arval
PHH Arval, a subsidiary of PHH Corporation (NYSE: PHH), is a leading fleet management services provider in the United States and Canada. PHH Arval provides fleet management solutions to a broad range of industries and has a client base that includes nearly one-third of Fortune 500 companies. Through consultative expertise, flexible customer service, and innovative technology, PHH Arval helps clients reduce costs and increase productivity. For more information, visit www.phharval.com, or call 800 ONLY PHH.