Government Fleet Top News

GF Survey: 82% of Fleet Managers Report Fuel Budget Increase

December 28, 2011

TORRANCE, CA - Government Fleet conducted an informal fuel survey in November, asking how public sector fleet managers purchase and manage their fuel, and how they handle rising fuel costs. A total of 134 fleet managers responded, giving a general picture of fleet fuel-management trends.

The increase in fuel prices is a growing concern for public agencies across the country. Of the fleet managers surveyed, 82% reported their fuel budget has increased in the past five years (2006-2011).

Overall, the highest raw number of fleets reported more than a 25% increase in their fuel budgets. Depending on the organizational structure of fleets, some passed this cost on to user departments by increasing rental rates or direct billing for fuel cost. Others, however, had to justify the cost to City Council, County Commission, or agency management if there was a budget overage. Some covered the additional costs through a contingency fund, a fleet reserve account, or even surplus dollar savings from previous years. *Percent decrease values in each category were statistically insignificant.

*More than one response was possible.
*More than one response was possible.

Purchasing smaller or more fuel-efficient vehicles is a more commonly reported fuel-reduction strategy than purchasing hybrids or alt-fuel vehicles. Also high on the list of strategies is creating or enforcing anti-idling policies in order to reduce fuel costs. Some strategies listed under "other" include upgrading a fuel system, reducing equipment loads, and creating motor pools or enforcing use of more fuel-efficient or alt-fuel vehicles in the pool. Aftermarket devices tested include SCT programmers, Idle Right, and Priority Start.

Some ways fleet are changing their purchasing methods include significantly reducing retail purchases and implementing agreements with other county agencies for fuel purchases, creating co-op contracts with other agencies, requiring metered loads rather than "drops," piggybacking contracts, switching to a bi-weekly bid award system, reverse auction fuel purchases, hedging fuel, and transitioning from biodiesel to regular diesel due to lower costs, as well as dyed diesel.

*More than one response was possible.
*More than one response was possible.
*More than one response was possible.
*More than one response was possible.

For fleets operating a fuel facility, respondents reported long-term bids are the most common way to purchase fuel, followed by purchases based on rack pricing. Some fleets use more than one strategy, such as assigning a fleet fuel card to some drivers, or purchasing fuel through an annual bid and supplementing this with fuel purchased through rack pricing.

In some instances, fleet managers shared fuel purchasing responsibilities with another department (such as purchasing) or with the heads of user departments.

A high number of respondents track fuel use through a fuel management system, with more reporting that they use manual data entry at the pump than automatic data entry.

Respondent profile: Fleet managers responding to the survey all worked in public sector fleets. Division between agency types are as follows: City, 45 percent; County, 28 percent; State, 13 percent; Federal, 6 percent; University, 3 percent; Utility: 4 percent; School district, 1 percent. Fleet size breakdowns are: Less than 100 units, 4 percent; 100-500 units, 40 percent; 501-1,000 units, 26 percent; 1,001-3,000 units, 16 percent; 3,001-5,000 units, 6 percent; 5,001-10,000 units, 6 percent; 10,001-15,000 units; 1 percent; more than 15,000 units, 1 percent.

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