Green Fleet

A United Fleet: How NYC is Saving $415M in Fleet Costs

May 2014, Government Fleet - Cover Story

by Thi Dao - Also by this author

A Parks Department forestry log loader is pictured here in front of the Unisphere in Queens, New York. Photo courtesy of New York City.
A Parks Department forestry log loader is pictured here in front of the Unisphere in Queens, New York. Photo courtesy of New York City.
At a Glance
The New York City fleet’s savings initiatives include:
  • Reducing the non-emergency light-duty fleet by 475 vehicles
  • Implementing department motor pools and partnering with Zipcar for employee use
  • Shutting down 10 facilities
  • Moving to an online auction to sell surplus and retired vehicles
  • Expanding biodiesel use across all fleet vehicles
  • Expanding use of a fuel management system to all fueling sites and vehicles.

With nearly 27,000 units, the New York City fleet is the largest municipal fleet in the country. It’s one of the most visible and services the most populous city in America. However, decentralization was causing inefficiencies and duplicate work, and staffers saw a potential for huge savings in sharing services.

While this had been talked about for years, it wasn’t until late 2011 that the ball got rolling to make some changes. Keith Kerman, previously overseeing fleet in the Parks Department, was appointed the Department of Citywide Administrative Services’ (DCAS) chief fleet officer in 2011, a new position created to oversee the service sharing program and implement other fleet initiatives. An executive order in early 2012 solidified the goals.

Some of the goals DCAS tried to meet were to optimize the operation, better track operations, reduce costs, and improve fleet sustainability, Kerman said.

The fleet departments formed an interagency working group and in the next two years, members worked on numerous fleet changes that would improve efficiency and reduce costs, including a new vehicle auction system, a new fleet management system, light-vehicle fleet reduction and creation of motor pools, and the consolidation of maintenance facilities. The final result of these and other changes is an estimated $415 million in savings and cost avoidance from FY-2012 to FY-2016.

How did New York City achieve this savings? Kerman explains how the team did it, how much it saved, and what he believes are the most successful aspects of the savings and efficiency program.

Uniting the Large Fleets
One of the biggest assets to the program was the formation of what staff members call the Fleet Federation, which consists of the 10 largest department fleets that meet every two weeks. These fleets control about 24,500 of the city’s vehicles (about 91%), have their own maintenance facilities and fleet managers, and mostly worked in isolation. The major fleet agencies are: Police, Fire, Sanitation, Transportation, Environmental Protection, Parks & Recreation, Correction, Education, Health, and DCAS. DCAS supports these fleets in areas such as acquisitions, fueling, sustainability, service contracts, and parts, but it doesn’t oversee their maintenance facilities. The other 40 agencies with small fleets rely more heavily on DCAS for fleet management, including maintenance, fueling, and vehicle tracking.

 The Fleet Federation consists of representatives from the 10 departments with the largest fleets in the city, representing 24,500 vehicles. The group meets regularly and was a main driving factor in the success of the city’s savings initiatives. Photo courtesy of New York City.
 The Fleet Federation consists of representatives from the 10 departments with the largest fleets in the city, representing 24,500 vehicles. The group meets regularly and was a main driving factor in the success of the city’s savings initiatives. Photo courtesy of New York City.

“The overarching theme was to ensure best practices that were happening in certain parts of the city were duplicated and run city-wide,” Kerman said. This is in addition to shared services among departments with fleets.

One example of duplicating successful practices was with the use of biodiesel, which only the Sanitation and Parks & Recreation departments were using in significant amounts. “If biodiesel is an important project for our environmental goals and it’s successful for agencies like Parks and Sanitation, is there any reason we aren’t doing this everywhere?” Kerman said.

Now all fleet vehicles use B-20 biodiesel when possible, while emergency vehicles use B-5. This change allowed the city to run a “greener” fleet, helping accomplish one of its goals of reducing petroleum fuel consumption. The fleets paid for this biodiesel switch, and even saved 50 cents per gallon, by switching from more expensive D1 winter diesel fuel to D2 for its biodiesel blend. Kerman said this blend had been tested and was in use successfully for years by the Parks and Sanitation departments.

In September 2013, city officials passed a law requiring the use of biodiesel in fleet vehicles, codifying a practice that was already taking place.

Another example of expanding a successful program is the widespread implementation of EJ Ward’s CANceiver fuel management and vehicle data system. The Parks and Police departments were already using automated fuel tracking, and DCAS is looking to expand this to all 200 general use fueling sites and on every vehicle by the end of this year.

“We think we’re going to have enormous capacity as Parks and Police has to better study fuel use, to better optimize deployment of vehicles,” Kerman said. With the system, fleet staff will be able to determine deployment of hybrid and electric vehicles depending on utilization and study driver behavior such as speeding, acceleration, and idling. These safety items are critical as the fleet implements a new plan to reduce pedestrian fatalities. The increased efficiencies and fuel cost reductions are expected to offset the cost of the system.

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