How to Optimize Your Fleet's Vehicle Utilization

When it comes to getting the most out of their vehicles and equipment, fleets can employ a variety of approaches. By staying on top of their assets' preventive maintenance needs, organizations can keep unplanned downtime to a minimum and lower their repair costs. Training drivers to avoid bad habits behind the wheel (like idling, harsh braking and speeding) can reduce wear and tear on the road. And by planning routes strategically, fleets can curtail wasteful fuel consumption and unnecessary travel.

But a more subtle (and often overlooked) approach to boosting return on fleet investments is optimizing the utilization of vehicles and equipment. Simply put, monitoring how they put their individual assets to work allows organizations to make smarter assignment decisions that benefit their fleet as a whole.

So let's dive into why asset utilization matters and how you can start optimizing the usage of your fleet.

What is vehicle utilization?

Vehicle utilization refers to how much you're putting your individual vehicles to work. Because acquiring and maintaining vehicles is a major expense, fleets aim to maximize the work they accomplish with every vehicle they operate to recoup their investments.

The impact of uneven utilization

Despite that motivation, in practice, fleets often leverage their vehicles unevenly, overburdening some while neglecting others. This can result in vehicles having shorter lifespans and breakdowns occurring in batches one after another.

By tracking your vehicle utilization, you can gauge how well your fleet's workload is being distributed across your vehicles and if adjustments need to be made to achieve greater balance.

How can I audit my fleet's vehicle utilization?

To determine the extent to which you're using your vehicles, you'll obviously need data. If you've been consistently logging your vehicles' mileage (either by hand or via telematics), you should have all the necessary numbers.

1. Begin by calculating how many miles your vehicles are individually accruing each month. The further you look back the better you'll be able to spot how seasonality impacts your vehicle utilization, so aim to review at least one year's worth of data.

2. Once you have all those mileage changes, see how your vehicles compare against each other. Are your vehicles traveling roughly the same number of miles each month or do you see notable discrepancies? If the mileage increases look fairly even, then you're likely doing a great job at balancing work across your vehicles.

3. But if you find that there's a significant range between your smallest and largest mileage changes, dig into the service histories of your least-traveled vehicles. If they were out of commission during months where they saw less use than their peers, then a temporary dip in usage is probably no cause for concern.

4. If you find repeated, significant discrepancies in mileage changes unrelated to downtime, then your vehicle utilization could likely benefit from a more strategic and deliberate approach to vehicle assignments.

How can I optimize my fleet's vehicle utilization?

Fortunately, fleets have many options when it comes to improving their vehicle utilization, which means organizations of all sizes, industries and vehicle types can find tactics that fit their circumstances.

1. Move underutilized vehicles to branches in need

If your organization operates out of multiple branches, relocating neglected vehicles to locations where they can see more use can be a reliable means of increasing their utilization.

That's a tactic that Asplundh, a provider of tree pruning and vegetation management services, employs to great effect. The company has regional locations in multiple countries, so when seasonal shifts reduce the need for a vehicle in one area, they'll move it to a branch where it can still be put to use.

We certainly don't want to be having fleet just parked up, not getting utilized. We're paying for it on a monthly basis, so [...] we'll incorporate with another business unit [to] maximize the utilization of that piece of machinery knowing full well that it's going to work on, let's call it an essential contract, for six months [and] the summer contractor's going to use it for the other six months of the year. Bryan Abott, Fleet Manager of Asplundh Australia

With this approach, Asplundh is able to maximize the value it gets from its fleet assets year-round.

2. Assign vehicles based on travel distance

A subtle way of equalizing vehicle utilization across your fleet is to assign vehicles to jobs based on the distance they'll need to travel.

For example, if you have two vehicles (one heavily used and one underused) and two jobs (one far and one near), assigning the less used vehicle to the distant job brings the two vehicles a bit closer in terms of utilization. And while individual jobs won't move the needle much, over time, deliberate vehicle assigning can go a long way towards balancing how your vehicles are put to use.

3. Dispose unneeded vehicles

While not a scenario that most fleets find themselves in, some organizations do wind up with more vehicles than they actually need. In such cases, organizations often benefit more financially from parting ways with unneeded vehicles than evenly balancing work across a bloated fleet.

If you suspect that your fleet has a surplus of vehicles, use mileage metrics to predict how disposing of varying numbers of vehicles would impact your remaining fleet. When you run these analyses, also try to consider how your operations would be affected by unplanned downtime with your future number of vehicles. Then, identify your cost of ownership for the vehicles you would dispose of and forecast what your operating expenses would look like without them.

By analyzing these factors with different vehicles and different quantities of vehicles, you can rightsize your fleet through data-backed decisions.

How to Use Fleetio's reports to balance vehicle utilization

If you manage your fleet with spreadsheets, whiteboards or paper documents, then monitoring your vehicle utilization can often be quite cumbersome and time-consuming. Fortunately, fleet management systems can automate the number crunching side of things so you can immediately view your vehicle utilization metrics whenever you like.

Fleetio's vehicle utilization reports make it easy to assess how well you're distributing work across your fleet and to spot outliers in need of balancing. In the example above, you can see a fleet that's utilizing its vehicles quite evenly. While there is some variability (which is normal), all vehicles are clustered rather close to each other.

But in this example, you can immediately spot a vehicle that's being severely underutilized. Depending on why that vehicle is being neglected, utilization that low can be a strong indicator that it's time to dispose of that vehicle.

And, lastly, this utilization report example highlights a utilization discrepancy that could be easily corrected. By assigning the overutilized vehicle to nearby jobs and the underutilized vehicle to work far away, over time, you should be able to close the utilization gap between those two outliers.