Rolling costs downward: Addressing top fleet costs

Rolling costs downward: Addressing top fleet costs

At this years Electric Utility Fleet Managers Conference (EUFMC), held in June in Williamsburg, Va., organizers addressed top costs for fleets. Among them were tires, which account for a high percentage of expenses incurred by these mixed-use, multi-vehicle-type vocational operations.

One technical session on “Tires—Minimizing Failures and Managing Cost” began with a presentation by Brian Witter, regional manager at Southern California Edison. Across a 50,000-sq. mi. service territory with geography and terrain that includes coastal, mountain and desert areas, the company fields more than 6,000 vehicles that collectively travel 160,000 miles every business day. To keep the fleet running effectively and efficiently, SCE Transportation Services has 168 technicians at its 43 maintenance locations that range from large repair centers to single mechanic garages.

“Rate challenge initiatives have increased pressure to reduce internal costs,” Witter began. “Beginning in 2013, SCE Transportation Services realized a 21% reduction in costs, in part by reprioritizing resources and focusing on higher skilled technical work, as well as by outsourcing services such as fueling, light-duty vehicle preventive maintenance and tire maintenance.”

In the past, Witter explained further, SCE’s internal tire program included ordering and inventory programs, mounting and dismounting and tire inspections, along with some vendor supplied on-site servicing and roadside service. Today, the operation is working more closely with a tire maintenance partner that has five locations servicing its territory, including service centers, a distribution center and a retread facility.

“We’re moving toward a complete vendor-managed tire maintenance program and the savings are already adding up,” Witter related. “By transferring tire labor from our garages to the vendor, we saved $30,000 in the first quarter of 2014 compared to the same three-month period the year before. That annual savings of $120,000 is on top of the 60% reduction we’ve realized in tire costs since 2012 by significantly increasing our use of retreads.”

SCE’s tire vendor now handles monthly on-site inspections for tread wear, damage and inflation, and scheduled and emergency roadside service. The supplier also manages the fleet’s tire inventory in its facilities and tires at SCE locations for emergency replacements. The company also tracks casings and schedules replacements based on an established SCE Tire Management Procedure.

“In the future,” Witter said, “we’ll be implementing new tire management software that will allow us to track tires by vehicle, size, tread, pressure range, load rating and product code. That information and usage reporting will lead to a more efficient ordering process, better forecasting of tire replacements by vehicle and location, and reduced inventory costs. Most importantly, it will improve tire life in our fleet and help us keep our technicians focused on the core needs of our equipment.”

Manufacturers on the EUFMC program reported how they are helping fleets address tire issues as well. Mike Hayn, engineering manager at Bridgestone Americas Tire Operations, told fleets that working with manufacturers to choose the correct tire for an operation will result in the most value.

“To accurately identify the correct tire you need to know what your fleet does with its vehicles and the performance traits you need from tires,” Hayn said. “At the same time, manufacturers are improving fuel efficiency and meeting traction demands by using new rubber compounds and tread designs and are increasing removal mileage by developing technologies that have additional performance characteristics.”

Norberto Flores, brand manager commercial tires at Goodyear Tire & Rubber Co. noted that as utility fleets look to lower operating costs, improved fuel efficiency and enhanced tire integrity and dependability are key factors. “Products are continually improving,” he said. “The next generation of smart tires will have electronic pressure and temperature sensors, and RFID technology to identify and track tires.

“With that information,fleets can develop life cycle models for making better tire related decisions,” Flores continued. “In addition, nationwide tire and service networks are in place to provide consistent capability and there are business tools to help fleets manage their tires as well.”

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