While understanding the relationship between truck ownership and operating cost is an important part of fleet management, it is the fluency in applying the concept of truck residuals to the financial side of fleet management that helps fleet managers drive better acquisition and disposition decisions. This paper covers the two main approaches to vehicle utilization – the rental concept and the market concept and how the two differ from each other. It also helps fleet managers to understand WHEN to right-size their fleet based on asset utilization to avoid the hidden cost of additional maintenance events.
The practical application of the fleet management methodology offered in this paper arms the fleet industry professionals with the knowledge of fleet management best practices, ability to drive better fleet management decisions that are mathematically and statistically supported by not only the house data but overall market data as well.
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