FleetBeat

Strategies to Prepare for Rising Fuel Prices in 2012

Thursday, January 26th, 2012

Article:

Over the last few years, everyone has been feeling the pinch from the rising cost of fuel. Many businesses and fuel procurement offices have assumed that if they could just get past a couple of tough years, that fuel costs will stabilize. If there’s one thing that’s become clear over couple year, it’s that high oil prices are here to stay. 2011 set a record for highest average inflation-adjusted fuel price, and 2012 is projected to keep pace with those levels.

While the high cost of fuel can be a vexing problem for businesses everywhere, it’s can be a major obstacle for shippers and carriers. Luckily, there are a few things that companies that manage a fleet can do to manage the rise in fuel prices. Here are two ways that companies help reduce the impact of high fuel prices on their bottom line.

Improve Procurement of Fuel
One of the main trends that we’ve seen in the oil and gas market over the last couple of years is increasing volatility. It’s not uncommon for the market to swing five cents per gallon on a given day. If you find yourself on the wrong side of a purchasing decision when buying thousands of gallons of gas, you can quickly bleed money and go over budget. There are some automated solutions, such as FuelQuest, on the market that can help companies forecast demand, monitor on-hand fuel, and procure at the best market price. These solutions can help companies avoid buying at the wrong time and bolster their bottom lines-and they can often save four to six cents per gallon on fuel purchases.

Better Manage Your Fleet
After making better fuel purchasing decisions, better managing the fleet is a logical next step. While there are some very impressive new technologies (e.g. eco-friendly engines and aerodynamic trailers) on the market, these can be pricey investments. Where companies can get a far better bang for their buck is in employing highly-skilled drivers that are versed in fuel saving technique such as smooth acceleration and momentum control. A skilled driver can save, on average, anywhere from five to 20 percent in fuel efficiency. Another boon is keeping tire pressures at proper inflation levels as a three percent variance in air pressure impacts fuel efficiency by one percent.

Plan Routes More Intelligently
A final way save on fuel costs is to better plan the way that shipments are delivered. This boils down to both delivering along more efficient manner routes as well as shipping loads more efficiently. There are a number of technology solutions that have been developed to help fleets shave off fuel costs by planning routes that require fewer miles and fewer stops. One of my favorite examples of how effective route planning technologies can be is how UPS saved on fuel costs by minimizing the number of left-hand turns that drivers make. While was just a minor change in the way UPS  delivered their packages, it ultimately wound up saving them more than 10 million gallons of gas.

These are just a couple of ideas on how to save on fuel costs. For more strategies to reduce fuel costs, you can visit the Software Advice – an online resource for distribution business software. The original post can be viewed at: Three Strategies for Reducing Fuel Costs in 2012.

To learn more about Fleet Management technologies that help fleet managers increase efficiencies and decrease costs such as those incurred by speeding, idling, and poor driving habits click here.

Do Your Drivers Make Fuellish Decisions?

Monday, October 18th, 2010

It’s not the best pun, but it’s certainly fitting.  Drivers who make “fuellish” decisions are ones who can cost organizations millions of dollars a year simply by leaving their engines running when their vehicles are not in use. 

An article by Mike Antich on Automotive-Fleet.com discusses how, in addition to simply wasting gas, vehicles that idle for an hour also add the equivalent of forty miles of engine wear-and-tear.  Multiply that by five and suddenly your vehicles have driven an extra 200 miles in a single week.  Extrapolate that figure to a year and a vehicle has traveled over 10,000 miles going nowhere.

It’s not hard to see how costly this type of driver behavior is to an organization.  If you’d like to learn more about the hidden costs of poor driver decisions, the article can be read here.

If you’d like to view a short demo on how expensive an idling vehicle can be for your fleet, click here.

A Guide to Reducing Fuel Consumption with Vehicle Telematics: How to Select the Right Solution

Wednesday, April 7th, 2010

Fuel costs account for 28-30% of most fleet’s budgets. Considering how much fuel costs, this makes reducing fuel consumption one of the most important issues facing fleet managers. Culprits such as prolonged idling and excessive speeding make driver behavior the number one factor in fuel consumption.

A speed and idling monitoring solution allows managers to monitor idling, instances of excessive speed, and unauthorized use of their fleet vehicles. Armed with this information, they can address wasteful driver behaviors to significantly reduce the amount of fuel consumed by their fleet and save their company money.

An urban paratransit agency that recently began piloting a speed a monitoring system was immediately able to identify over 17 hours of unnecessary idling per vehicle in a single week. This costs the agency almost $35 per vehicle, per week in wasted fuel. Extended to their 650 vehicle fleet, the agency would waste more than $1.6 million dollars a year in fuel from excess idling.

Click here to download a white paper to learn more about reducing fuel consumption and how a telematics solution can help.

In the News: Make Every Drop Count; Account for Every Drop

Tuesday, February 23rd, 2010

Using fuel cost-effectively can be a challenge for fleet-based organizations. Fuel is responsible for one of the highest operating costs of transportation businesses, and managing this expense is even more important when prices are fluctuating. BUS Ride has a useful article on fuel management systems. Read it here.

Understanding the Benefits of Speed and Idling Monitoring

Wednesday, September 9th, 2009

This fun animated demo explains how speed and idling monitoring works, how it saves you money, and illustrates what kind of ROI you can expect.  Click here to check it out.

ROI Numbers: Idling Monitoring

Friday, July 17th, 2009

Hello everyone!  There’s lots of talk out there about monitoring idling as a way to cut costs. For our first post, I thought we’d get right into some ROI numbers to give you food for thought:

• According to the DOT, an average truck burns 0.9 gallons of fuel per hour idling. A typical owner with 5 vehicles idling for about 1 hour a day is wasting 4.5 gallons of fuel each day. At an average fuel cost of $5.67 US per gallon, that’s $25.54 US a day, $127.72 a week and $6,641.44 US a year. (GEOTrac)

• 60 minutes of idling is equivalent to between 80 and 120 minutes of driving time. The resulting loss of fuel economy from excessive idling can add up to 800 gallons of fuel annually for the average truck. (Argonne National Laboratories)

• Reducing idle time by 10% increases efficiency by 1 mpg to 2 mpg, and most fleets achieve more than a 55% reduction in idle time within 6 weeks of implementing a GPS fleet management program. A fleet of 5 vehicles loses, on average, around $1600 per year, per vehicle, by not managing engine idling. (Integrated Solutions, January 2008)