Planning A Fleet for The 21st Century

John KilianTransport Manager

Glasgow City Council

Planning A Fleet for The 21st Century

Specification

Balancing The Scorecard

Option Appraisal

Specification

Commodity Group

Procurement

Operations

Transport

Specification

Procurement View

“One Size Fits All”

Current Fleet Procurement Is Inefficient

Significant Savings Can be Achieved

Specification

Operations

Vehicles & Equipment That Are “Fit For Purpose”

The Flexibility To Procure Whatever Equipment They Need As Service Requirements Change.

Specification

Transport Issues

Equipment Maintenance

Local Service / Spares Backup

Warranty

Specification

What Should Be Included In Specification?

Output Specification – Number Of SeatsCapacity / PayloadTypes Of Bin To Be Lifted

Specification

Specifications : Specific & Detailed

Body long-member: Minimum requirement: En10025 S355 High tensile steel 3.5mm thick.

Body Cross-Members : Minimum requirement: En10025 S355 High tensile steel 3mm Thick

Packing Blade: Minimum requirement: En10025 S550 High tensile steel 4.7mm Thick

Ejector Panel: Minimum requirement: En10025 S355 High tensile steel 2.7mm Thick

Specification

Options

Specification

Commitment

Changing Environment

Need To Change Vehicle Specification

Budget Constraints

New Technology

SpecificationCompromise – Framework Agreement

Indicative Vehicle Numbers Used From Existing Fleet

No Commitment To Suppliers On Vehicle Numbers

Option To Tender For Different Vehicle Types

During Core Contract Period

All Warranties Set At 3 Years Bumper to Bumper

More Than One Supplier

Specification

Other Considerations

Creating Equipment Lots To Maximise Potential Discounts

Drop Corporate Identity

Balancing The Scorecard

Cost v Quality

Balancing The Scorecard

Cost – Financing Options

Current Model -Operating Lease or Capital Purchase

Proposed Model - Contract Hire or Flexi- Lease

Balancing The Scorecard

Cost – Financing Options

CapitalOutright Purchase – Residual Risk With Council

Operating LeaseSecondary Tender – Fixed Term Payment - Residual Risk With Lessor

Contract HireVehicle Provided With A Fixed Term Finance Package -

Residual Risk With Supplier

Flexi-Lease - Secondary Tender –Variable Term Payment Residual Risk With Lessor

Balancing The Scorecard

Cost –Maintenance Options

In House

External

Combination

Balancing The Scorecard

Cost – Final Contract Options

Outright Purchase / Operating LeaseWith & Without Maintenance

Contract HireWith & Without Maintenance

Flexi-leaseWith & Without Maintenance

Balancing The Scorecard

Cost – Best Option

Heavy Vehicles Over 3500kg Outright Purchase / Operating LeaseIn House Maintenance

Light Vehicles Up To 3500kg Outright Purchase / Operating LeaseOutsourced Maintenance

Balancing The ScorecardOutsourced Maintenance

Tyres Not Included

1 Hour Response - Minor Repairs

48 Hour Vehicle Replacement

24 Hour Backup Service

Service / Inspection 12 months / 12000 miles

Balancing The Scorecard

Quality Content

Detailed PQQ’s

High Emphasis On Service Provision / Backup

Local Support

Added Value Items

Balancing The ScorecardQuality (At What Cost?)

Euro 1 Euro 5 EEV Euro 6

1.5 1.5

0.25

2.0

0.02

0.15

0.46

1.5

0.13

0.4

0.01

2.0

0.02

0.5

4.5

1.1

8.0

0.36

N/R

CO (g/kWh)

HC (g/kWh)

NOx (g/kWh)

PM (g/kWh)

Smoke (m-1)

Euro 2 Euro 3 Euro 4

4.0 2.1 1.5

1.1 0.66 0.46

7.0 5.0 3.5

0.25 0.1 0.02

N/R 0.8 0.5

EEV = Enhanced Environmental Vehicle

Based on ESC test

European Emission Standards

Balancing The Scorecard

Environmental – Added Value Items

PM filter, completely maintenance free

Passive Soot Filter For EEV Emissions

Balancing The Scorecard

Environmental – Added Value Items

SCR Catalyst Exhaust

Dosing Unit AdBlue tank

Adblue Costs 33p / LitreSupply Infrastructure

Selective Catalytic Reduction

Balancing The Scorecard

PM Filter

30%

Higher Fuel Consumption?Higher Maintenance Costs?

Balancing The ScorecardExhaust Gas Regeneration

Balancing The Scorecard

“ Technological Breakthrough for Scania:Euro 5 With EEV & No Fuel Penalty”

Source Scania UK Website 5th Sept 2007

“First Hybrid Refuse Truck In The World Launched In Sweden”

Source Volvo Truck & Bus UK Website 7th April 2008

Option Appraisal

Labour Costs

Material Costs

Ease Of Repair

Other Contract Issues

Option Appraisal

Within Quality Scores You Must Sub-Score!Criteria Weighting

Cost 40% - attributed to prices entered as part

of Commercial Parameter document

I.T.T Evaluation Questions (Contained in the Technical Parameters document )

60%

Business/Experience 15%

Servicing, Maintenance & Repair Service 20%

Account Management 5%

Delivery 15%

Health & Safety 2.5%

Training 2.5%

Option Appraisal - ConclusionHas It Worked?Advantages;

No Commitment To Vehicle Numbers

Potentially Higher Volume Discounts

No Need To Re-Tender Year on Year

Encouraged Greater Supplier Competition

Fleet Continuity

Retained Corporate Image

Option Appraisal - Conclusion

Has It Worked?

Disadvantages;

Won’t Cover All Vehicle Options

Limited Scope For New Technologies

Supplier Apathy – Limited Returns

Option Appraisal

Savings?

Item Costs Less Than You Would Expect To Pay!

RPISteel PricesOil Prices

Cost Avoidance

Option AppraisalConclusions

Detailed Specification – Including Options

Obtain Multiple Suppliers For Each Lot

Consider Best Finance / Maintenance Options

Specify Every Possible Vehicle Type & Option

Build In The Ability To Take Updated Technology

Balance Quality Against Cost To Ensure BV

Agree Environmental Standards