Contact FleetCUBE

Vehicle Maintenance
Labour rates will always increase in today's economic scenario. Many of the imported vehicle's parts prices tend to be very high compared to locally built vehicles. Watch these two costs areas.

Parts prices escalate at ± 20% a year. Pirate parts are part of the scene in any country and have become more available in general terms. In-house workshops are usually inefficient due to the lack of financial and management controls. Vehicle maintenance is not as simple as it seems. About 10% the total fleet costs falls into this category. The latest trend for cars to be sold with some level of inclusive maintenance plan is easing management situations. But you still have to think about the time when the plan ends.

REMEMBER that there is a VAT element that can be claimed when maintenance is included in the price of the car.

The more usual problems faced by the fleet operator are as follows:-

• The actual tracking of maintenance due and already carried
• The negotiating of discounts and ensuring they are passed on to company
• The difficulty of scrutinising invoices for correct charging on parts and labour
• Controlling the actual payment methods.
• The correct and meaningful authorisation of expenditure.
• The associated problems of over and under maintenance.
• Detecting charges for warranty work.
• Controlling maintenance schedules in relation to the work needs of the company and the specific vehicles.
• Accepting rand value budgets rather than controlling on a c/km basis.
• The ability to budget repairs on the actual work done i.e. component failure, tyre changes, etc.

Unless carefully controlled these problems will lead to unacceptable cost escalations. It must be accepted that budgets only control expenditure not maintenance per se.

Statistics show that upwards of 70% of all fleet owners use the franchised dealer when it comes to services and repairs. Apart from anything else this makes good sense as the dealer is best trained and qualified to do the work.

The various maintenance options are given below:

Normal Maintenance.
Full responsibility falls on the Fleet Controller to have systems in place to cover and eradicate the above-mentioned problems. Unless constant and proper attention is given to all of these areas it has to be assumed that the costs will be higher than they should be. Budget control at a higher level will be arbitrary at best. It will tend to be a percentage added to last year's figures.

It cannot be assumed that the use of a fleet card system will actually control costs. This is simply a payment mechanism with a series of monthly reports. Only by utilising the system properly can one assume that costs are being controlled. In simple terms the controllers need to be controlled.

Managed Maintenance.
This is the most widely used method in the USA. A third party (a fleet management company) is retained to manage and authorise all maintenance. A fee per vehicle per month is charged to the fleet owner. It is an efficient service that puts your maintenance under the control of experts.

Manufacturer Maintenance Plans.
These are well used by fleet owners. The principle is that a period of use and kilometers to be driven is agreed. A fixed monthly rate is calculated on these criteria, This method provides risk free and fixed cost maintenance.

Well maintained vehicles also return better resale values, are more reliable and enable better utilisation standards to be maintained.

A standard system must be introduced for VAT input collections in respect of all maintenance and servicing costs. Making use of maintenance plans make this a relatively easy administrative task.

© 1998 - 2008 © FleetCUBE. All rights reserved. Disclaimer
Found a fault on the web site, click here and tell us about it.