Are pool cars a more effective use of fleet assets?Fleet Management / 25 February 2019
From ownership to access
A global shift away from vehicle ownership is happening. There are a lot of factors underpinning this shift – such as increasing urban density and parking options, congestion, environmental concerns, rising fuel costs and the emergence of the gig economy, to name a few. In particular, ride-sharing services are proving to be an economical and convenient alternative for many commuters.
The improved convenience and lower cost benefits are not just confined to private vehicle use.
Car-pooling systems have been the choice du jour for many in the not-for-profit and governmental sector for a number of years. While still needing a large fleet of vehicles to carry out their day-to-day operations, organisations like the Australian Red Cross have long-relied on the cost-efficiencies that car pools can deliver to stretch their funding dollars that little bit further.
New forms of car-pooling are also being adopted within corporate culture around the world. In parts of Europe, the subscription model that powers the success of companies like Spotify, Netflix and sports streaming services is being applied to vehicle use as well. For example, in the UK, LeasePlan’s new Subscribe and Drive model is proving popular with small-to-medium enterprises while, in Australia, companies like Liftango are offering a viable alternative for corporate commuters.
The case for car pooling
As the costs of doing business fluctuate with the constant change of our digital era, many businesses are slowly transitioning from large-scale vehicle leasing arrangements to smaller pool car fleets. And, while having a pool of cars available for employees to use might not be a perfect or practical fit for many businesses, understanding what your vehicles are used for is the first step in deciding if this kind of model is best for your organisation.
“Understanding [vehicle] utilisation is probably one of the biggest wins available when it comes to leasing,” says Chris Park, LeasePlan’s Manager of Strategic Fleet Consulting. “And it might sound strange for a leasing provider to say this, but the best way to save money with a vehicle is to not put it on the road in the first place.”
“What a lot of organisations that I’m looking at encounter is they have some vehicles that do a lot of kilometres or lots of vehicles that do mid-range kilometres,” admits Chris. “And then, usually, there are a few vehicles that just get parked and not used a whole lot. It’s really for those low-kilometre vehicles that I raise the question – would you be better placed to just have a pool vehicle that you can drive around?”
He continues, “Do you really need to have a vehicle or can you share? Is there opportunity to move people out of designated vehicles and shift away from a ‘I drive that particular vehicle’ mindset to having people use a pool car.”
“If you’ve got five people in an office and each person has a car, that’s more expensive, obviously, than having four cars that everybody shares. If you’ve got the ability to manage that effectively, then you might be able to rationalise a fleet from five down to four and save whatever the monthly cost is, or whatever the purchase cost of that vehicle is.”
To go one step further, Chris talks about developing auto technology and integrated systems in the future that will allow businesses to entertain the thinking that has underpinned the growing popularity of ridesharing services – if you have a number of organisations in the same building, could you feasibly see a time when you pool vehicles with those other companies?
“Right now, the trends we see are corporate customers looking more closely at their fleet utilisation, and increasing the number of pool cars they have on fleet to improve it. he says. “It would make sense, as the connected technology of cars increases, that we will start to hear and see more and more of corporate car-pooling in the future.”
With this focus on improving utilisation, and the shift in attitude to pool cars – or, possibly, even influencing it – vehicle leasing providers already have pool car software and systems so that organisations can take advantage of the cost (and environmental savings) that car-pooling brings.
“It’s a no-brainer, really,” concludes Chris. “Adopting pool cars as part of your fleet will improve utilisation. If your fleet leasing provider can give you pool car management software support, why wouldn’t you consider it?”
Want to talk about making pool cars part of your business fleet strategy? Talk to LeasePlan about our Pool Car Management (PCM) system.