Fuel for thought – the right strategy for your fleet
As alternative types of fuel flood the market, more thought needs to go into understanding your fleets’ needs …but how do you identify the right fuel for the job?
The drive to develop and utilise more sustainable and cost-effective vehicles has led to greater choices, especially when it comes to engine and drivetrain options …and there’s a lot of factors to consider.
But what’s the most effective strategy for your fleet?
Put simply, there is no simple or single answer to this question, but a comprehensive selection strategy can help you make a much more informed choice.
Among the vast amount of data that’s often generated by modern vehicles, it’s important to build the following considerations into your final fuel-selection equation:
Efficiency and sustainability
Tax implications and incentives
Current and proposed legislation
To help you understand the importance of implementing a fuel selection strategy and current options on the market, we have compiled a short guide.
The Who, What, When, Where and Why of Fuel Selection
First things first, you need to compare how different types of fuel can help to meet your specific business needs, however, in order to do so you need to understand the purpose of each individual vehicle. Ask yourself:
Paying close attention to the above factors and building this information into your selection strategy will, in turn, help to manage fuel usage and realise the best return on investment. Ultimately, your fleet needs to be fit for purpose, and a ‘one-size-fits-all’ strategy is no longer a viable option.
Stay Ahead of the Curve
In order to anticipate fuel and maintenance expenses for each type of powertrain, it’s essential to build a Total Cost of Ownership (TCO) model.
Vehicle usage and the availability of alternative fuels can also significantly impact your TCO, so be sure to add the below factors into your fuel-selection equation:
Fuel Economy – this can vary substantially depending how and where vehicles are driven. You may find that a vehicle that performs well in one region or part of your operation may perform at a completely different level in another – which, in turn, makes it difficult to make fuel savings.
Emissions – control over emissions can be a good way to show how serious your operation is about sustainability. Fleets are under increasing pressure to be more environmentally friendly, so taking steps to measure and reduce emissions through proactive selection of fuel types can add significant value.
Regulations – in some jurisdictions, it’s necessary to encourage or prohibit types of fuel or vehicles based on their environmental performance. Make sure you understand how the types of fuel that work best for your operation fit in with current and future regulatory activity.
Complete and accurate mileage, km per litre (kpl) figures and fuel data is key to making informed decisions and, in order to generate realistic expectations, it’s sensible to use intelligence that has been generated by your existing fleet.
Statistically speaking, kpl figures and emission reports are manipulated by around 30% when comparing real life statistics with those presented by manufacturers, so it’s best to build your TCO model based on reliable and trustworthy figures.
Fuel Types Uncovered:
So it’s decision time, and you’ve already considered the driver, the vehicle’s purpose, duration of use, drive locations and TCO …but it’s also important to consider the pros and cons of each individual fuel type – and there’s a lot of options available on the market!
Let’s look at some of the more traditional types currently available for autos and commercial vehicles:
Petrol-powered vehicles lead the race in Australia, accounting for around 75.7% of national fleet.
Petrol-fuelled vehicles are often the least expensive to purchase, especially as this fuel type also tends to be cheaper at the pump, not to mention widely available …but despite these two powerful and hard-to-ignore advantages, petrol-powered vehicles tend to be less fuel efficient than some other alternatives.
Also tipping the scale – but not affecting this fuel types popularity to any concerning degree – maintenance and repair costs tend to be higher, alongside depreciation rates.
Steadily growing in popularity amongst Australian drivers, diesel-powered vehicles now make up 22% of all registered drivers in the country – something that can be seen particularly amongst SUV and Ute sales.
Whilst it’s true that diesel vehicles are considerably more expensive to purchase outright – and fuelling at the pump is more costly – it often achieves better fuel economy than petrol.
Diesel cars also retain more value and fetch lower repair and maintenance costs …so there is money to be saved here!
On the flip side, Diesel vehicles have come under increased scrutiny in recent years in terms of environmental performance. This is largely because they release more nitrogen dioxide (NO2) and particulate matter (PM) that their petrol counterpart, both of which have been increasingly pinpointed as areas of concern in countries focused on air quality.
All hybrid vehicles capture energy for their batteries through regenerative braking, and use the energy to provide power to the wheels. These vehicles achieve reduced emissions and higher fuel economy.
In terms of initial purchase price, hybrids tend to be more expensive than conventional vehicles, but maintenance tends to be less frequent and this can reduce downtime and associated costs.
Universally speaking, hybrid is increasingly becoming the third most popular fuelling method.
Electric vehicles (EVs) run 100% on electricity supplied from a rechargeable battery, offering a quiet, clean form of transport with a complete absence of tailpipe emissions. As a result, these fairly new additions to the automotive marketplace are strong contenders for local and urban operations.
EVs also have very low refuelling costs compared to conventional vehicles— by some estimates the cost-per-mile to fuel an EV represents approximately one-third to one-quarter the cost of petroleum fuels — depending on electricity prices and the price of fuel at the pump.
Additionally, EVs require less maintenance than vehicles with internal combustion engines. Driving range and does tend to be limited compared to conventional vehicles requiring recharging stops, making EVs ideal for use on short trips and for driving in urban areas at this point.
The best strategy for assessing fuel choices is to start by looking at the big picture, before drilling down into the many important aspects that need to be taken into account. Fuel economy, fuel costs, sustainability, initial prices, maintenance requirements, regulations and even resale values can all impact your choices.
Today you have more fuel choices than ever before, and with that comes an opportunity to drive down costs, make real improvements to your operation, and achieve long-term value in a number of areas.
There may be no simple or single answer to the question of which fuel type to use in your fleet, but without a comprehensive selection strategy, it is impossible to make an informed and effective choice.