The City of Lansing, Mich., will terminate its business relationship with NAPA for the supply and management of vehicle parts at the city’s central garage facility, Mayor Virg Bernero has announced. After reviewing the costs and savings associated with the agreement, Bernero concluded that the agreement is not likely to generate the savings originally anticipated.
“Working with NAPA to supply the city garage with parts was a good idea in concept, but it hasn’t met our expectations for cost savings. For this reason, we will return to operating our in-house parts supply with city staff,” Bernero said in a release.
Last month Finance Director Angela Bennett completed an analysis of the costs and savings associated with the NAPA license agreement. Her report concluded that while the city would likely realize modest savings from using NAPA personnel to staff the city’s parts supply store, the potential for significant savings on the purchase of vehicle parts could not be confirmed with available data, according to the city.
Jett Kuntz, vice president of NAPA IBS, disagreed. Upon request, the company had provided city management with an update on cost savings for its first 120 days of operation in June, he said.
"Our team provided savings information that was in line with the goals of the project when the mayor and city team began the contract in February of this year," Kuntz said. "At this time, it appears that the reality of the situation is more political than based on a lack of value for the City of Lansing, Mich."
Bernero had pushed for the city's contract with NAPA and originally estimated that the contract could save 50,000 to $150,000 and increase efficiency, the Lansing State Journal reported.
Earlier this year, city council members had questioned whether the contract violated a collective bargaining agreement with two union parts room employees.
The mayor expects to end the contract within the next 30 days, the Lansing State Journal reported. However, Kuntz said NAPA had not received a formal notification of contract cancellation and will continue to operate per the agreement.