How do you recognize the “sweet spot,” the optimal time to replace your old vehicles with new ones? By considering a lot more than just fuel economy.
Earlier this month, Patrick Gaskins, CTP, Group Vice President of Financial Services of AmeriQuest Transportation Services, penned an article for monitordaily.com that warned fleet managers and owners of the danger of focusing on fuel economy alone and letting that dictate your trade cycles. Gaskins indicates that with the gains in fuel economy, many fleets are using that one factor to decide when to trade in their older, less fuel-efficient equipment. But, he notes, companies should also be considering acquisition costs of new assets, interest rates, maintenance and repair costs, resale values, technological improvements, fuel costs, warranty programs, and utilization.
Using only one of these considerations, to the exclusion of others, can lead to unintended consequences. Gaskins provides the hypothetical example of a manufacturer who suddenly produces a truck with a 12 MPG capability. The first reaction might be to want to replace every tractor in the fleet; however if all fleets did that, the glut of used trucks on the market would considerably depress used truck values, and that would impact negatively on the cost benefit equation. He recommends that fleets consider all pertinent measurements and that they review those calculations on a regular basis in order to optimize their vehicle lifecycle.