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There is little doubt that equipment purchases represent a significant investment for any size carrier. Therefore, the process of selecting the best possible equipment at the best possible price is critical.
Fleet Managers need to make sure they select new equipment that will benefit them and their company.
Summary of requirements
Fleet Managers must take a "process approach" to the purchase of new equipment.
Among the most important aspects of the purchase process is making sure you purchase equipment that is designed for the job and the company. This can be both a pleasant and challenging task assigned to any Fleet Manager. Whatever equipment is selected, Fleet Managers must know that they are going to have to live with the vehicle and its components for years to come.
Several areas must be considered when purchasing the organization's vehicles including:
- Productivity. Depending on your type of operation, productivity could mean maximizing payload or available trailer space within the legal limits for the vehicle's size and weight. In order to maximize productivity, the equipment must have sufficient power (while delivering acceptable fuel economy), and components and accessories capable of carrying the load.
- Life-cycle. As stated previously, equipment purchases represent significant investments. One way for companies to ensure a decent return on these investments is to extend the productive life of the equipment. Carriers can accomplish this by establishing a proactive and aggressive maintenance program. On the other hand, many carriers operate under a definite equipment trade-in schedule. But even in these situations, maximizing return on equipment investment needs to be a top priority.
- Driver-friendliness. With driver turnover a major challenge facing the trucking industry, purchasing equipment that is driver-friendly has become vital. Fortunately, with advancements and improvements in vehicle ergonomics, there are more options available than ever before.
- Matching the equipment to the job. Buying too much vehicle means that you're spending more money than is necessary to do the job. Buy too little and the vehicle will not be able to perform as the vehicle engineers intended. Buying too little vehicle can also lead to overloading or overworking, which inevitably will cause premature wear and tear on the vehicle and its components, increasing maintenance and repair costs.
- Cost. Acquisition, operational, and maintenance costs must all be considered. New equipment may be expensive to purchase, but may show a better return on investment (ROI) based on lower operational and maintenance costs. This is because newer equipment tends to be more efficient to operate and will be less prone to expensive maintenance and overhauls. Also, warranty coverage for new vehicles can help absorb some of the carrier's maintenance costs.
- Regulations. The up-to-date manager must also be aware of proposed state or federal regulations that might affect the vehicle's size, weight, and emissions in the future. Many new vehicle configurations evolve from these limits. As emission controls become tougher, new fuel controls and exhaust systems must be developed to meet the requirements, while still maintaining or improving efficiency. In addition, new or revised regulations might impact the specifications of safety accessories and components. Staying up to speed on the federal and state regulations that deal with equipment is a critical responsibility of the Fleet Manager.
- Scope of service. Another thing to take into consideration is the evolving and/or changing scope of the organization's service. The operation itself must be reviewed. Have changes occurred that require a different kind of equipment? Will the vehicles be traveling to a new geographical area? Are new marketing strategies being planned that will require the vehicles to perform a variety of tasks? Can one new vehicle replace two old vehicles because of operational changes or vehicle improvements?
- Whether purchasing with the intent of using a life cycle, or making decisions based on present vehicle performance, the Fleet Manager must work closely with the other managers (maintenance, safety, and finance) to make an informed and educated decision on vehicle replacement.
- Spec’ing. As equipment is often the largest investment for a carrier, a considerable amount of discussion needs to take place regarding the process of specifying, or spec'ing vehicles. Whether leasing or purchasing, the first step is to determine the requirements for the new vehicles. This needs to be done even before the first dealer is contacted.
- Once you have your specs, the next step is to approach dealers for their input and pricing. If you do not have your specs in place, the dealers will try to sell you what they believe may be best suited to your application (and possibly most expensive).
- Economy of scale. The more identical units the vehicle manufacturer can build in a "run," the more willing the dealer and manufacturer will be to provide a discount. If a carrier purchases one vehicle per quarter, rather than four on the same order, the carrier will see a higher cost per unit due to the dealer and manufacturer being unwilling to provide a discount.
Equipment Leasing. Leasing vehicles is seen by some as an alternative to purchasing. Reasons for selecting leasing over purchasing include:
- Possible tax advantages
- Asset control - minimize assets on books
- Constant equipment replacement
- Transportation (and investment in transportation assets) is not part of the company's core business
- Desire to outsource all vehicle issues i.e. maintenance, replacement decisions, etc
- Capacity flexibility
One of the main disadvantages to leasing is at the end of the lease; the carrier has not gained an asset. Carriers typically have the option to purchase the vehicle at an adjusted price at lease end, but they will not own it until then. Most for-hire motor carriers do not lease because they desire to have the assets. Private carriers on the other hand, many times lease to avoid having assets that are not part of their core business.
Leasing equipment can provide any carrier with the ability to add or decrease capacity to match customer demands. Carriers involved in industries that are prone to seasonal swings (both for-hire and private) will many times lease equipment on cycles that match their customer demands.
Financing the purchase is also a substantial consideration. In some cases the carrier may get the best package directly from the manufacturer. In other cases the best financing option may be a financing company that specializes in financing carrier equipment. Finally, the carrier may receive the best financing package from the bank or financial company that is already financing other portions of the company.
Financing can be handled much like the equipment process. First, decide what you want, and then get dealer proposals. In the case of financing this will require you to settle on a cost per unit. Once this is settled on, approach the various financial institutions for their proposals. Remember to consider all costs when reviewing financing packages. Interest, payment fees, loan charges, and other fees all need to be considered.
Equipment specifications. While Fleet Managers may not personally develop or select new vehicle specifications, they should be familiar with the principles involved. At the very least, the Fleet Manager needs to be involved in the process to provide input as to how the new equipment specifications will impact operations, driver satisfaction, customer requirements, reliability, and other issues. Many future headaches can be avoided if you consider these items during the selection process.
It's a good idea to review any past equipment specifications with future operational needs and maintenance in mind. In order to do this, the organization should involve the personnel closest to the issue. This would normally be the Fleet Manager and the Maintenance Manager.
Undoubtedly the first questions to be considered early in the process will concern the product that is being hauled; the payload. These questions include:
- What is the product?
- How is it shipped?
- What does it weigh per case, gallon, pallet, etc.?
- How much is shipped per trip?
- What does the total payload weigh?
- What are the dimensions (cubic feet, gallons, etc.) of the payload? •
- How is the product loaded? Unloaded?
- Are there any special handling procedures for the payload?
As you review this list of questions, think about what effect the product hauled has had on the vehicles. Have there been any persistent problems with the vehicles? Are the cross-members adequate? Should flooring be strengthened? What about sidewall, liner, and flooring materials? Is a lift gate or other special equipment available that can make the vehicle and driver more efficient?
This process must be undertaken any time new equipment is to be purchased. It must also be repeated every time there is a change in the customer base which affects the products being hauled. Vehicles purchased with the intent of hauling only dry products may receive unintentional structural damage if you try to haul refrigerated or wet products in them. Mismatching the equipment to the product can also increase cargo claims and customer complaints.
- Where the vehicle runs is as important to proper spec'ing as knowing what it carries. Anyone looking at a new vehicle needs to ask:
- What kinds of roads are used?
- What is the terrain like?
- What region of the country will the vehicle primarily operate in?
- How many hours are run during the day, or at night?
- What are the speed requirements for a vehicle performing this kind of operation?
- Are there any special driving requirements (such as off-road operation)?
- Will the vehicle return nightly if not, how long will the driver be "living" in it?
Answering these questions will begin the process of deciding what driveline, tires, and other vehicle configurations will be required.
Much like the product information, the operating environment the vehicles are operating in should be reviewed with every vehicle purchased and any time there is a change in the customer base. Vehicles that were purchased to operate in a local application may be ill-suited for an over-the-road environment. The Fleet Manager needs to be constantly aware of the products the vehicles are carrying and operational environment in which they are being operated. Changes in products or the operating environment may lead to accelerating vehicle purchases or to replace vehicles that no longer match the fleet's needs.
After drawing your own conclusions about the requirements for the new vehicles, it can be helpful to get input from the drivers and mechanics. Suggest a meeting; a brainstorming session on what went wrong on the old vehicles and what participants would like to see on the new ones.
Talk to the mechanics about the old vehicles. Were there any features that made repair difficult? Were any components hard to get at? Were any special tools required that they didn't have? Were some parts always on back order? In other words, was there anything about the vehicle that required special pains to repair and irritated mechanics in the process? They won't appreciate having the same hassles in a new vehicle. Ask them to point out the "model" vehicles in the fleet and describe specifically what makes them easier to maintain. Take advantage of the input they can provide.
Ask the drivers to critique the vehicles and, more importantly, the performance of the vehicles on the road. What improvements have they observed in other vehicles? Is there any equipment that might speed up unloading or loading procedures? What special "extras" might motivate them to take better care of the vehicle? Ask drivers to make specific recommendations about the improvements they'd like to have in a new vehicle. This is not a "Christmas list" for the drivers, it is a fact-finding discussion. Management isn't obligated to take every suggestion, but listening doesn't take long and it's the first step in problem-solving. You can't fix what you haven't heard about.
It takes time to develop new specs and while the dealer will already have most of the available choices narrowed down, there are always additional components that may save money in fuel economy and/or maintenance costs based on your operation. It's been estimated that only 20 percent of the total costs over the life of the truck relate to purchase price, so putting some extra cash into components now may be worthwhile in the long run.
You should be knowledgeable about new equipment options that are becoming available. Talk to other people in the industry to learn how the products are working out for them. Ask your truck dealer for opinions about components. If the dealership you work with has a service department, ask how components from different manufacturers have performed. Keep a file of ideas that look interesting and don't hesitate to ask for advice.
The next step is to take the information gathered so far and work with the Maintenance Manager and dealers to spec the equipment. Here is a guide to follow to assure you do not overlook any key considerations when reviewing components:
- Product carried
- Operational requirements
- Cab configuration
- Driveline (engine, transmission, drive axle(s))
- Non-drive axle(s)
- Electrical system
- Air dryers reduce water, oil, and carbon contamination; the curse of any air-braking system. They operate on the principles of condensation, use of a drying agent (desiccant), or centrifugal force to clean and dry the compressed air before it is delivered to the system. If you think an air dryer might help reduce brake problems, check to see what additional maintenance will be involved with servicing this component.
- Engine braking has become more important because today's fuel-efficient truck models roll more easily and the new fuel-efficient engines have reduced natural engine-braking ability. Retarders fill the need for additional engine-braking; they spare the braking system, while allowing the driver to control the retarding power. They fall into four categories:
- Exhaust retarders have a control which closes the exhaust pipe, thereby creating back pressure in the exhaust system to slow the engine.
- Engine retarders and engine brakes change the valve timing or injector functions in the engine, thereby limiting the number of cylinders working (the venerable Jake brake is of this type).
- Hydraulic retarders cause the engine to work against a fluid system contained in a closed housing that is part of the transmission.
- Electric retarders consist of electromagnetic coils which produce a drag force on the truck's driveline or trailer axle.
- Maintenance-free batteries require less frequent checks for water levels, reduce actual water loss from the cells, and minimize corrosion. Whatever the choice, price should not be the only consideration. Vibration test information can be an important key to how long a battery will last, yet one manufacturer reports that fleets seldom request this information when considering a brand. A new container material, structural foam polypropylene, is available in addition to the usual hard rubber and thin-walled version. This newer material weighs less and seems to offer better resistance to vibration.
- Fuel heaters can keep the fuel flow going smoothly. Choose a mechanically simple model that heats the fuel before it goes into the first fuel filter and also prevents overheating of the fuel. Since the primary fuel filter and its supply line are the most common component affected by cold weather, it may be helpful to choose a model located in the engine compartment. Avoid those mounted outside the frame rails where they are exposed to wind.
- Water separators can be used in combination with a primary fuel filter or separately, to keep water and other contaminants in fuel from reaching the engine. Since they must be drained regularly to prevent freezing, be sure they're conveniently located.
- Aerodynamic accessories can significantly increase fuel mileage. Air resistance is a truck's second greatest impediment to movement, and therefore optimum fuel economy. Only weight impacts miles per gallon more. Efficient aerodynamics smooths the flow of air over, under, and around the vehicle. It is not uncommon for some aerodynamic vehicle designs to save carriers as much as 4-5 cents per mile in fuel savings. Aerodynamic accessories include:
- Cab extenders, designed to bridge the gap between the truck cab and the trailer.
- Side-skirts cover the fuel tanks and battery box, smoothing out the overall profile of the truck.
- Air-dam front bumpers and aerodynamic hoods which are designed to ease air flow around the front of the vehicle.
- Other aerodynamic accessories (or aerodynamic location of accessories), such as mirrors, air intakes, air horns, and grab handles.
- Trailer air deflectors including nose and rear "bubbles," side skirts, and axle air deflectors.
Any of these options can increase fuel economy by 1-3 percent.
- Tire size does matter since a truck's overall gearing changes with the diameter and circumference of its tires. Tread type also impacts fuel economy, since a tire's tread helps determine rolling resistance. For example, a lug-type drive-axle tire in winter will improve traction, but will also lower fuel economy by 2-4 percent. Tire technology has improved dramatically recently. With improvements in tread designs, casting designs, rubber compounds, and friction reduction, definite and significant savings can be realized by spec'ing the right tires for your equipment.
- Safety Equipment. Let's face it; this can be a dangerous industry. In a time when even small accidents cost companies an average of $25,000, safety is critically important. Nothing you or your drivers do is worth getting anyone hurt or killed over.
What drivers can't see can hurt them (or others). Visibility means being able to see beyond the view available through the windshield. When purchasing equipment, try to choose windshield and window configurations that open up the driver's view.
Next, consider ventilation options. Without proper ventilation, the windshield and side windows can easily fog up. For this reason, many carriers opt for add-on defroster fans. Peeper windows, cut into passenger side doors or sleeper sides, can also greatly enhance driver visibility. Consider this option when ordering your vehicles.
Visibility doesn't end with what your driver can and cannot see. It also involves helping the general public see your vehicle. As a safe and responsible organization, it is your job to ensure your vehicles are as conspicuous as possible. Things to consider include:
- Vehicle color. Bright colors reflect light while dark colors tend to absorb light. This is an important consideration, especially during night operations.
- Conspicuity systems. Even though federal regulations state specific reflectivity, pattern, and size requirements for conspicuity treatments for tractors and trailers, a carrier can certainly choose to go above and beyond the regulations. The easier your equipment is to see, the safer it becomes.
- Lighting. While LED turn signals, stop lamps, and marker lights are more expensive, they can last up to 10 times longer than more conventional bulbs. But in addition, LED lights will also light 2 / 10 of a second faster than their incandescent counterparts. Although this might not seem like a lot, at speeds of up to 75 mph, that amount of time accounts for 15-18 feet of stopping distance.
Ease and safety of entering and exiting the vehicle should also be considered. This is especially true for operations which require the driver to mount and dismount the vehicle repeatedly during the day.
- Electronic Safety Systems. There are presently several electronic safety systems available. Here is a list of some of the systems available, along with a short description of each. One key point to these systems is the vehicle needs to have the ability to support them. These systems will increase the demand on both the electrical system and the electronic system’s communications network on the vehicle.
- Collision warning systems (CWS) use radar, sonar, infrared, or laser technology to warn the driver when the vehicle is getting "too close" to another vehicle or an object.
- Intelligent cruise control systems (ICCS), also known as adaptive cruise control, communicate with the engine computer to slow the vehicle by "defueling" the engine if there is a hazard too close to the front of the vehicle or the vehicle becomes unstable. ICCS usually works with other systems (CWS and ESC). Advanced versions under even apply the brakes to prevent or minimize the effects of a collision.
- Automatic emergency braking (AEB) is a system that will automatically defuel the engine and apply the brakes to prevent or minimize the impact of an accident, if the driver does not apply the brakes in time.
- Lane departure warning systems (LDWS) use video technology to alert the driver if the vehicle is departing its lane without the turn signal active. The system is designed to help the driver avoid "wandering" into other traffic lanes or leaving the roadway.
- Steering assist systems will apply small steering inputs to move the vehicle back into its lane if the vehicle departs its lane without a turn signal active.
- Blind spot monitoring systems use cameras, sonar, infrared, or laser technology to alert the driver if there is traffic in the right or left side blind spot. There are also side-mounted camera systems that replace the mirrors and provide a wide enough vision area that the driver’s blind spots are eliminated.
- Backup camera systems on straight vehicles allow the driver to see what is directly behind the vehicle on a dash-mounted screen. There are also portable camera systems available that can be used in conjunction with a smartphone or a dash-mounted screen that are well suited for use in tractor-trailers and large straight trucks that are not equipped with a fixed camera system.
- Electronic stability control (ESC) use yaw and roll sensors to sense if the vehicle is approaching the edge of its stability envelope. If the vehicle becomes unstable the system communicates with the engine, telling it to reduce power to avoid a rollover. If necessary, the system will also make "intelligent" braking decisions to attempt to stabilize the vehicle.
- Antilock braking system (ABS) and the associated traction control system, are a combination electronic/air (or hydraulic) system. The electronic sensors at the wheels sense wheel speed, and the processor makes decisions. The system then releases brakes in the case of a brake-induced skid or applies brakes and reduces power in the case of power-induced tire spin. The traction control system can be disabled in many vehicles, which then allows the wheels to spin. This is to allow the driver to “rock” the vehicle out of a situation where none of the drive wheels can get traction.
- Tire pressure monitoring systems (TPMS) monitor the air pressure in all of the vehicle’s tires and warns the driver if a tire loses a percentage of its air pressure. Some systems available for air-brake vehicles can refill tires that are low enough to trigger a warning, as well as monitoring the tire pressure.
Vehicle purchasing can be a daunting task when it comes to all of the possible electronic safety options. However, with careful thought and planning proper equipment acquisition can be realized for the benefit of management, drivers, and employers alike.
READ MORESHOW LESS
['Business planning - Motor Carrier']
['Company growth - Motor Carrier', 'Equipment specing and purchasing - Motor Carrier']
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