Element Fleet Management > Case Studies > Overcoming Fleet Vehicle Allocation Restrictions: A Case Study

Overcoming Fleet Vehicle Allocation Restrictions: A Case Study

Technology Category

Functional Applications - Fleet Management Systems (FMS)
Robots - Autonomous Guided Vehicles (AGV)

Applicable Industries

Automotive

Applicable Functions

Maintenance
Procurement

Use Cases

Fleet Management
Vehicle Performance Monitoring

About The Customer

The customer in this case study is a client of Element Fleet. They operate a fleet of vehicles and had planned to place factory vehicle orders for their fall order cycle. However, they faced a challenge when the OEM cut off ordering due to their vehicle needs exceeding the OEM allocation. They had an additional 50-unit order planned for 2022, which meant they were looking at a total of 100 units that needed replacement. They turned to Element Fleet to help them navigate this challenge and find a solution to their vehicle needs.

The Challenge

In 2021, an Element client, like many other fleets, planned to place factory vehicle orders for their fall order cycle. However, they soon discovered that the original equipment manufacturer (OEM) had cut off ordering due to the client's vehicle needs exceeding the OEM allocation. The fall order exceeded the allocation by 50 units. The client had an additional 50-unit order planned for 2022, which meant they needed to find a solution for the 100 units that needed replacement. The challenge was to navigate the OEM controlled ordering allocations and find a way to fulfill the client's vehicle needs.

The Solution

Element Fleet experts, through close collaboration with the client and the OEM, found a solution to the challenge. They learned of another client who had cancelled a 100-unit order and identified an opportunity to reallocate these vehicles to their client. The timing was critical to secure the units, and the client needed to advance the order of 50 units they had planned to place over the next 12 months to meet all their 100-unit replacement needs. This solution required strategic planning and swift action to secure the vehicles before they were taken by another client.

Operational Impact

The operational result of this solution was highly beneficial for the client. They were able to secure the 100 units they needed for their fleet, avoiding the need to wait for the OEM to lift the ordering cut-off. This not only met their immediate vehicle needs but also allowed them to plan for their future needs by advancing the order of 50 units they had planned for the next 12 months. The reallocation of the units also avoided dealer markup and increased maintenance costs, resulting in significant savings for the client. This case demonstrates the importance of close collaboration and strategic planning in overcoming supply chain restraints.

Quantitative Benefit

The reallocation of 100 units avoided dealer markup and increased maintenance costs.
The client saved approximately $500,000 in total based on average dealer stock price of $5,000 over MSRP.