Strategizing for a Successful Fleet Future

A lot has happened since the beginning of 2022 — new electric vehicles (EVs) have rolled out, stricter emissions regulations have been put in place, and supply chains have forced some fleets to rethinktheir strategy, to name a few. With everything that has taken place during the past year, we are left to wonder, “What does this new year hold, and will there be any new challenges ahead?” 

During the pandemic, Kevin Schlangen, CPFP, CAFM, CEM, remembers hearing talk that the supply chain disruptions would be short-term, that fleets only needed to be patient before things returned to normal. However, the Dakota County, Minnesota fleet manager has seen first-hand that challenges such as this have continued to linger.

With certain manufacturers set up to have major components coming in from other countries or a single source provider, fleets were left with delays. Schlangen expects these delaysto continue into the newyear.

“I think in 2023 you’re going to see slow delivery times it’s going to take much longer than what we expected to get new pieces of equipment in,” he said.“We see more of the same struggles are going to hit us all, and that’s just the repair and maintenance end of it.”

Another issue that Schlangen has been, and expects to continue facing is finding and keeping technicians.

“Who is going to be the next generation?” He asked. “How are we going to keep our industry running?”

He expanded on this explaining that many people in fleet leadership roles, particularly those of the Baby Boomer group, are either retiring or planning to retire. It’s another gap he foresees needing to be filled with individuals who can run different fleets and understand the complexities that come along with new technology changes. Schlangen is also keeping an eye on new mandates regulating how fleets operate. His question is whether these new regulations are in the realm of reality.

“Do we have politicians and people making decisions on things that are not deliverable?” he asked, using the example of having a fully electrified fleet up and running within only a few years. Schlangen feels that many ofthe issues surrounding government fleet have become hyper-politicized, especially when it comes to mandates coming out of California.

He feels this could cause frustrations down the road and hopesthat expectations, such as zero-emissions deadlines, will become more realistic for fleets.

“You can't turn around and suddenly have something that you would normally have replaced with a clean diesel engine and make it electric,” he said. “If you want it to be all-electric, it might cost three times the price.”

In Dakota County, additional EV charging stations are being installed to accommodate the new EVs being purchased. And while there will be some “new” for 2023, the fleet is also hanging onto some of the “old.” The fleet is continuing to use equipment they normally would have sold. However, most of this equipment is not being used.

Instead, it’s being kept in case they need to put it back into service. Several squad cars are one example of this. Normally these would have been decommissioned, but they’re being held onto if they need to be cycled into use in the event another vehicle is not serviceable. Because they have been holding onto more than the usual amount of equipment and vehicles, this means the revenue stream has been disrupted.

Revenue from what would have been sold would have gone toward shoring up the county’s capital program for the replacements already bought, according to Schlangen. Schlangen compares the situation to a game of Tetris where the department has to move purchases around to keep things flowing. They’ve also stocked more parts and have a higher inventory than in the past.

“We cannot trust the other suppliers,” he said. “We’ve had to have more parts on hand just to make sure that if certain things with higher pass-through, we have higher quantities on that.”

Schlangen recently went through capital budget requests with upper management and elected county officials to discuss where they are at as a fleet and the frustrations being faced. He was met with a mutual understanding of the issues.

“As a fleet manager, you're going to have to explain it the way it is. Whether they like to hear that or not. They need to be told, I can't get that or this,” Schlangen explains. He goes on to say that fleet management can’t wait for mandates and need to find out where new technology would fit in. What does that look like? It’s being proactive and having pilot programs drafted to present to leadership.

“If you have 300 pieces of on-road equipment, out of those 300, you need to know how they're being used right now,” he says.“ You have to be able to have all of that information ahead of time, you need to be providing them with logical and reasonable explanations.”

Schlangen breaks down areas to address when presenting information:

• The percentage of vehiclesthat can be converted

• Time it would take to be zero-emissions

• How these changes would affect the municipality, ie cost, infrastructure, and accessibility

• What it could look likewhen a product is not available or batteries are dead

Schlangen noted that it’s important to make the connection between these areas and let officials know what it will look like if those changes are implemented. He adds that it’s important to know the direction your fleet is headed and what direction you’d like it to go.

That’s where a plan, and how that plan would be supported, comes in.

“What would happen if they followed your recommendation? What happens if they don't?” He said. “Instill confidence in your decision makers and your elected officials to support your vision.”

He advises keeping it simple when presenting these plans, something that can just as easily be put into a bulleted list. This is a way to catch officials’ attention and then expand upon it as more elaboration is needed.

In the end, it’s about providing all the information so that questions don’t come up later on. For Schlangen, it’s also about doing a better job of supporting the needs of all the user groups and communicating that to the decision-makers and the elected officials.

“Continue to plan ahead. Make sure you have a story,” Schlangen said. “Make sure you know what direction you would like your fleet to go. Don't wait to be asked what direction you want to go.”

The Sustainability Factor

Planning for the future means looking at all the aspects of the fleet and how changes will affect the municipality it is based within. This is where we turn to sustainability and how this goes hand-in-hand with the direction many fleets are headed when it comes to transitioning fleets toward a greener future.

Jeff Vredenburg, City of Sarasota Sustainability Coordinator

The city of Sarasota’s sustainability office has several important projects that are taking place in 2023. Firstly, the city will be working on a Climate Vulnerability Assessment to designate levels of vulnerability to city assets and infrastructure.

This assessment will be a refresh of the 2017 assessment and will use updated NOAA sea level rise projections. Furthermore, it will qualify the city for additional grants through the Florida Department of Environmental Protection.

When it comes to challenges, Jeff Vredenburg noted that there is a lack of understanding of the maintenance EVs will require, ensuring that charging infrastructure is in place, and fostering adaptation by employees who prefer to use (fossil fuel-based) vehicles they are more familiar with.

He explained that working with the local utility company to make sure that installed EV charging stations are able to pull enough power from the grid is essential in planning for new vehicles and charging stations and working with special divisions — such as the Sarasota Police Department—that may have certain requirements of their vehicles, is also important when considering EVs.

“Efficiency is the low-hanging fruit to sustainability,” Vredenburg noted. “Making sure that departments are not purchasing extra vehicles that sit in a parking lot for much of the time is key: are there two or three people that could share one vehicle?

EVs, although efficient, do require substantial amounts of energy to produce, so reducing the total number of vehicles required can make a big difference.” He explained that fleets can also share EV charging stations with the public as a way to provide a service to the community and also recoup some of the operating costs.

As for the role of fleet sustainability within a municipality, Vredenburg added that much of the work thatamunicipality accomplishesis based on its fleet. From sanitation trucksto landscaping employees to utility crews, the fleet that takes them around isindispensable.

By ensuring that their vehicles are functioning when needed and as efficiently as possible, the work that needs to get donewill get done on time, Vredenburg explained. In addition, he points out that municipalities have a fiscal responsibility to their citizens, and as EVs become more common they are becoming the most financially responsible choice as well. But what makes a fleet sustainable?

“Sustainability is the ability to meet the needs of the present without compromising the needs of the future,” Vredenburg stated. “A sustainable fleet can respond to any new challenges and be maintained by staff yet does not compromise any of the future plans of the municipality—either environmentally or financially.”

He explained that as more and more cities have goals to reduce greenhouse gas emissions, EVs are more likely to play a larger part in fleet makeup. When it comes to meeting those sustainability goals despite supply chain shortages Vredenburg points to planning and persistence.

“Having a long-range plan and sticking to it allows procurement and fleet managers to make good decisions and replace fleet vehicles with EVs when it is time,” he explained. “As time passes, fleet managers are having more and more choices with the vehicles that are available in the EV market, and I am hopeful that the selection will continue to expand.”

Across the Grid

There seems to be a growing understanding that as time goes on, technology will only become more prevalent in what we do. Technology is also changing how we look at at fleets and each individual vehicle’s role within a municipality. As more fleets go green finding and using the right tech to stay on course with sustainability goals as been key.

Chris Jackson, Associate Vice President, Public Sector Solutions at GEOTAB

To understand the future we sometimes have to look at the past. Associate Vice President, Public Sector Solutions at GEOTAB Chris Jackson has seen the velocity in both the appetite and adoption of technology starting to increase, applying to the types of vehicles being procured as well as peripheral technology such as telematics.

“Even from about five years ago there were still only select departments within agencies or leading agencies acting as the early adopters for telematics and other similar technologies,” Jackson explained.

However, he noted it has shifted to the mass adoption phase now where there are specific budgeting practicesto plan for and/ or maintain technology being brought in to assist the vehicles, fleet operators, administration, and management. The approach to how contracts and procurement are being built and executedwith fleettechnology has changed to be more encompassing of cooperative arrangements between government agencies, according to Jackson.

“Historically there was more of an approach to have very specific procurements for a particular technology, for a particular agency or department,” he stated. “However, that led to implementations which were limiting in expansion or silosin the use of the technology.”

According to Jackson, what has changed in our experience is the culture within procurement departments to be more comfortable in utilizing national cooperative agreements with pre-qualified products and services, as well as structuring any isolated procurements to be more flexible in how they can expand as products and services evolve, and let other agenciesjoin or utilize their procurement.

This takes usto the present role of the fleet manager into its evolution of being required to understand much more on the technology side and be aligned with IT departmentsthan it has been traditionally.

Examples he gives of new technology brought into the fleet range from telematics, to video telematics, to new management systems, to additional asset tracking technology that has become available for non-motorized assets, etc.

All of these technologiesrequire acumen on howcompliant they are to security standards, pricing policies, equipment safety standards, and data management (i.e. data residency and data management practices).

From his experience in the field, the biggest challenges faced are:

• The pressure to do more with less; requiring agencies to look at the future state as the consolidation of technologies/ programs, for example how telematics and motorpooling can be combined in a single initiative, budget, etc. to operate the assets more effectively.

• Aging fleets combined with supply chain constraints to replace vehicles. Government agencies are utilizing more technology now and will continue to in the future to manage the assets within the fleet to find opportunitiesto operate more efficiently and even reduce the size of fleets to relieve the pressure of purchasing new vehicles.

• Understanding the path to electrification and if it makes sense across all vehicle use cases, as well as the demand for associated infrastructure needs is a consistent topic where many are facing challenges on where to start, while others are looking at how to scale. As with the points above, utilizing technology such as telematics can help agencies understand and assess their current vehicle scenariosto make the decisions onwhat the future of their fleet looks like.

• With technology catalysts continuing to advance how commercial operations are approached, the pressure to adopt the right technology at the right time so the fleets can take advantage of being on the leading edge, but not the cutting edge. We will continue to see the future of fleet collide with technology companies in how vehicles are built, operate, and managed.