Understanding the true cost of fleet vehicle downtime

 

Understanding the true cost of fleet vehicle downtime

Source: FleetAnswers How costly is downtime for your fleet? Today's fleets may budget for the costs of downtime, but some researchers have found that the costs are significantly higher than what fleets anticipate, with some estimating the yearly cost of downtime to be as much as 8 times what the fleet expects. A closer look at these costs, and how to avoid them, is essential to ensuring that your fleet is running as efficiently as possible.

The Obvious Costs of Downtime

The obvious costs of downtime are the repairs necessary to get the car or truck back on the road again. Over the life of a fleet, these costs can become easy to predict and budget for. Most fleets have a repair and maintenance budget, which can be adjusted year-to-year based on the age of the fleet and any obvious upcoming maintenance needs.

When a breakdown happens on the road, the obvious costs increase again. Towing costs, emergency repairs and the delay in delivering the product or service provider to the customer adds to the cost of the breakdown. Yet these two obvious costs are just part of the big picture.

The Cost of Productivity - Less Obvious, But Still Costly

Productivity, unlike repair costs, is a cost connected to downtime that is more challenging to measure. How much does it really cost a fleet to have a truck sidelined? Here, you must consider all possible costs. A sidelined vehicle adds more demand on the other vehicles in your fleet, increasing their wear and tear. If certain equipment is not on the road, you may not be able to offer your full line of services. You also may have employees who cannot get to customers or deliver services. Deliveries are delayed, customers who call for service cannot be served and your company takes a financial hit.

The bottom line is this: when you can't meet your targets and deadlines because you have a fleet truck unavailable to you, your entire business suffers significantly. When your vehicles are not on the road, you can be losing between $400 and $700 a day in productivity alone! Add to this the cost of the repairs, and you can see that the costs of downtime are really quite high.

Taking a Proactive Approach to Costly Downtime

With the obvious and less obvious costs of downtime, fleets need to be proactive against this potential. A proactive maintenance plan, which focuses on preventive maintenance instead of reactive maintenance, can help limit downtime and keep trucks and cars on the road longer. This type of plan will perform routine maintenance, such as brake service, oil changes and tire care, on a routine schedule, keeping these crucial systems well maintained to avoid potential breakdowns. It may also involve a plan to replace or repair certain components at the end of their expected life cycles, rather than waiting for failure. Telematics systems can help by incorporating maintenance alerts to keep fleet managers informed of upcoming maintenance needs.

A plan for vehicle replacement is also an important way to stop the increased costs of vehicle downtime. Vehicles have a limited lifetime, and the number of breakdowns and costs of repair go up significantly as the age of the vehicle increases. Running trucks into the ground may not be the most cost effective plan because of the high costs of downtime.

Efficient fleets are those fleets that keep their vehicles on the road, avoiding downtime whenever possible. Make a plan for this, and watch as your operating costs decrease because of fewer problems with downtime.

Image courtesy of Pong at FreeDigitalPhotos.net

Anonymous (not verified)
Anonymous's picture

Frequent maintenance on your fleet is vital to preventing major breakdowns of any one vehicle, as it mentions in the article above.  Just like taking care of your own vehicle with oil changes, tire rotations and other scheduled maintenance, fleet driver management should take fleet maintenance into consideration.  This also protects your drivers, eliminating the risk of putting them in harm’s way while they are traveling.  Keep in mind the safety of your fleet driver team directly correlates to fleet downtime.  Since your drivers are the ones that are driving the vehicles every day, you should take care of every vehicle to prevent unexpected accidents which leads to vehicle downtime.  Of course there are always unforeseen circumstances that may lead to vehicle downtime; however a good management team should take into consideration “worst-case scenario” calculations.  These calculations should include everyday hard costs, daily operating expenses, salaries, daily production, etc. in order to gain a better understanding of how tooptimally prepare for any downtime scenario.   All in all, it's up to management’s discretion of how to handle fleet downtime and the best way to save costs on individual vehicle maintenance and repairs during downtime.  This article gives great advice on how to manage fleet downtime and when to walk away from a vehicle that may no longer be profitable to your business.

Anonymous (not verified)
Anonymous's picture
Vehicle Repair

Vehicle repair cost would be higher day by day, it is really tough to keep our vehicle with proper maintenance. We have to spend thousands of dollars every year to keep our luxury vehicles in a very good condition. It's definitely put a huge impact on our annual budget, but still, we have to manage these things with right repair and maintenance of our vehicle within the right time. Otherwise, we are facing different types of major errors.