Vice President of Strategics Fleet Operations, ARAMARK
Kevin, please give us an overview of your fleet.
It is one of the most diverse fleets I could have imagined. With a staff of six people, we support nine different lines of business. Our primary focus today is in North America, where we have approximately 10,000 vehicles, but we also operate in 22 countries across the globe. We have vehicles that range from Class one through Class eight. We have cargo operations, passenger operations and management vehicles, so it is quite varied.
What are some of the challenges that you have faced with your fleet?
Without good inventory information, cost information, fuel usage, maintenance expense information, and collision expense information, it is tough to make the right decisions. So, first, the biggest challenge was to build with the right partners a proper fleet management information system. That helps provide the proper total cost of ownership information to base vehicle decisions and more.
Undoubtedly you receive tons of information; how do you like to receive it?
I like to look for actionable date. It needs to be exception-report based. I don’t want to get buried in minutia. I want to understand things that fall outside of the agreed parameters and then we can take action on those.
You both own and lease your fleet; how do you make that decision whether you are going to lease or buy?
We have a combination of leased and owned vehicles, depending on whether we are in a replacement cycle or whether we have acquired a business. We have a percentage of owned equipment based on various acquisitions.
Our decision to lease or buy is about cost of funds. Generally, each time we have had that discussion with the treasury group we have agreed that leasing was the correct choice.
What kinds of services do you use from your fleet management company?
They assist us in selector development. We do a total cost of ownership analysis to help us make those decisions. They manage the leasing, license and registration renewal, insurance card distribution, collision management, fuel management, and personal mileage reporting; all of the support functions, maintenance call center, so it is an out-sourced solution from a fleet management services perspective.
You were a finalist for NAFA’s 2013 ‘Flexy’ Award for Excellence in Corporate Fleet Sustainability. Tell us about your sustainability initiatives.
I feel quite honored to have been nominated. I believe that was a result of the work we did specifically targeted to vehicle replacement. We made very good progress in converting conventional size vans to the smaller, more fuel efficient Ford Transit Connect. That product gave us an opportunity to double our fuel economy and halve our greenhouse gas emissions.
We feel strongly about sustainability. Last October, our fleet started to participate in a company-wide sustainability work group. We have an environmental working group but we are in the early stages employing alternative fuel vehicles.
ARAMARK recently joined the National Clean Fleet Partnership and we work closely with Clean Cities. In partnership with Greater Philadelphia Clean Cities Director Tony Bandiero we have submitted multiple grant applications. We have been instrumental in getting a propane powered bus out in Mesa Verde National Park in Colorado. We have a grant application in Denali National Park in Alaska under consideration and we have worked on some other projects.
We have been awarded ACT13 funding in Pennsylvania for converting route vehicles to CNG power. We started “spec’ing” gaseous prep last year in all of the vehicle configurations that we could to prepare for the eventual conversion to CNG or propane where it makes sense financially.
Having a very diverse fleet complicates matters a bit but we are looking wherever we can to make our environmental goals with the proper ROI. If that happens, we pull the trigger. We have about a dozen propane powered vehicles deployed and they are working out quite well,
ARAMARK is probably like every other company that wants to reduce costs. How do you take costs out of your fleet?
As a result of having the fleet management information system in place, and with the support of my fleet management services provider and their strategic consulting group, we actually did a vehicle replacement analysis last year. My team presented the results of our lifecycle recommendations to each of the business units. Every business unit CFO signed off on those recommendations and we are in the process of replacing our operational fleet at a rate of more than 50 percent. It is a huge development.
In addition to the vehicle replacement initiative, which is midstream, we are revising our commercial motor vehicle policy and overall vehicle policy at this time. We are rolling out new driver-focused safety training and we are looking at a total cost of ownership for making decisions for the replacement of equipment.
We are also lining up and showing the ordering managers the differences between the continued use of conventional fuels, considering a downsized vehicle and the benefits of that, considering a propane conversion, considering a CNG conversion and giving them the total cost of ownership projections for each of those options. I am hopeful that this will drive some greener decisions by virtue of educating the managers in the field.
Driver behavior is a hot topic. Is ARAMARK using telematics?
We are in the midst of a 180 vehicle, four vendor telematics pilot started in January, so we are right in the thick of it. My requirements for a telematics solution had to include in-cab driver feedback to influence driver behavior, the traditional monitoring of speeding, idling and hard breaking events to help influence driver behavior. And then we also needed a solution that could support regulatory compliance. We currently manage hours of service reporting, daily vehicle inspection reporting in a manual process, and it is time to automate that.
Tell us about your relationship with NAFA.
NAFA is a great resource. I came in to ARAMARK and was asked to join the NAFA Philadelphia Chapter. You know, you get out of an organization what you put into it and this has been very helpful to me. I was previously affiliated with the National Private Truck Council; I am a Certified Transportation Professional, so I focused on the CAFM and used that to get immersed in the automotive side. My background prior to joining ARAMARK was more on the Class 8, heavy duty transportation side. So it was very helpful to me and the contacts and the networking opportunities were invaluable. I just learned so much.