29 mar 22

How to deal with lack in vehicle supplies in North America

Due to the global shortage of microchips and raw materials, there is a lack in vehicle supplies in North America and this is especially true for corporate fleet managers and procurement experts. 

As many dealerships are not offering discounts traditionally given before this crisis some 2-3 years ago, this is highly impacting the fleet industry which is accustomed to receiving discounts of a few thousand dollars for each an every vehicle. 

What can be done about it?

First of all, be proactive and really understand what is required in your fleet and when it is actually needed. Keep yourself informed by reading whitepapers, attending webcasts and going to industry events. Moreover, according to fleet managers, plan ahead today, meaning at least a year in advance.

This is a chance for you to turn the crisis into a positive by reviewing and revising standard policy. Besides working towards repurposing and adjusting the planning of your vehicle lifecycles, stress the importance of timely required maintenance and repair. 

One of the things that can be done is extending vehicle lifecycles. For instance, while 80,000 miles and 48 months could be a standard today, you could enforce a minimum of 100,000 over a 48-month period or even extending the lifecycle to some 120,000 miles and 72 months. 

In the end, make sure you are acquiring quality vehicles all while mitigating risks and being compliant. And to support good decision making, utilize data and take advantage of technology, something that can be done through telematics and other IT solutions. 

Some of the key telematics players in North America are Geotab, Verizon, Trimble, Teletrac Navman, Lytx, Samsara, and MiX Telematics.

In terms of operational changes, savvy fleet managers may opt to implement a pool fleet or a car sharing scheme, not to mention a monthly subsidy for drivers as opposed to an actual vehicle. Moreover, fleet managers should evaluate who actually needs a car right now, at least until vehicle supplies return. 

According to a Global Fleet Survey on North America (USA & Canada) in 2021, carpooling looked to be the only mobility option making an impact in the country last year. While 5% of companies were using micro-mobility options such as scooters, 1-seaters, bicycles, and e-bikes, approximately 8% were using car sharing and 27% implemented carpooling.

Mobility solutions underway in 2021 (source: Global Fleet)

As you can see, if you are creative, there is an array of options, but it really depends on the profile of your fleet and your drivers. Take a comprehensive approach to your fleet management and carry out the proper due diligence so that you make the right decisions.

10 tips to dealing with today’s supply chain issues

•    Offer a monthly subsidy as opposed to an actual vehicle
•    Assuring vehicles is good, but don’t overlook mitigating risks
•    Work on repurposing and the planning of your vehicle lifecycles
•    Make sure that you are absolutely compliant along the way
•    Turn the crisis into a positive by reviewing and revising standard policy 
•    Implement pool vehicles or some type of car sharing scheme
•    Be proactive and really understand what is needed and when it is needed
•    Plan ahead, think for 2023 and even 2024
•    Keep yourself informed (whitepapers, webcasts, blogs) 
•    Utilize data to support good decision making
•    Stress importance of timely required maintenance/repairs - while managing rising costs in this area

According to Global Fleet interviews, most experts are expecting supply chain issues to gradually improve this year but some type of resolve to normality is not really expected until 2023 and beyond.

For more on what to expect in terms of fleet and mobility around the world in 2022, including risk mitigation and much more, download Global Fleet's latest e-book on the matter.

Authored by: Daniel Bland