EnergyFleet Blog

How has the economy impacted your fleet’s environmental initiatives?

By Karen Healey
Director, Product Management, PHH Arval

PHH recently announced the results of our annual survey on fleet environmental issues. For a full copy of the survey go to: www.phharval.com/greensurvey2009. One of the most telling responses was the answer to the question, “What impact has the current economic climate had on your fleet environmental goals?”  Two-thirds of the respondents said that it had not had any impact on their initiatives. We know that for some companies the complete answer was probably, “We didn’t focus on the environmental impact of the fleet before the current economic slowdown, and we still don’t – so no change.”  However, 21% of companies said the economic environment has actually caused them to accelerate their greening initiatives. That’s great news.

What this tells me is that a good number of fleet managers understand that environmental and financial benefits can go hand-in-hand.  It also tells me that these fleet managers are using tough economic times to uncover opportunities and look at alternatives that may have been off the table a year ago. We hear from people in the industry every day about the things they are doing, large and small, to move forward on their environmental initiatives.  Tell us what you are doing (or not doing) around “greening” your fleet.

Negotiating the Motor Company Landscape

By Greg Stanford
Senior Business Consultant, PHH Arval

The global economic crisis has hit virtually everyone hard; and the nature and depth of this recession has been most damaging to (apart from select major financial institutions) the motor vehicle manufacturers.

Chrysler has found itself in bankruptcy proceedings, and observers wonder if GM’s efforts to recapitalize and refocus will take the same route. The most visible impacts for these two manufacturers have been major plant shutdowns and drastic reductions in their dealer networks.

Ford has avoided taking government funds, but is also looking at significant restructuring steps, and even venerable Toyota is looking for ways to stem red ink.

This chart tells the tale, showing the annual rate of sales for light duty trucks (under 14,000 pounds GVW) since January 2007.

Total sales have dropped from an annual rate of 8 to 9 million vehicles to less than 5 million. Domestic light truck sales have fallen from just over 7 million to less than 4 million vehicles.

The precarious financial situation of the industry poses a number of risks for our fleets, including product availability, transportation and delivering dealer challenges, and pricing and incentive questions.

In looking for a silver lining, the timing of these plant and dealer closings is occurring over the summer months – normally a time of reduced activity, particularly for fleets. As of Memorial Day, most of the 2009 domestic light-duty pickup models are built-out. (There is still a short window to order ’09 Rangers and Silverado/Sierras.) We are hopeful that the motor company situations will be clearer as we approach the Fall start of the 2010 model year.

Currently, Ford is accepting orders for 2010 F-series trucks, and these along with the Dodge Dakota and Ram ½-ton, and Chevy/GMC Colorado/Canyon are expected to begin production in July/August. Start of production for the 2010 Silverado/Sierra and the Ford Ranger is targeted for the September/October timeframe.

Of course, the motor company situations are changing day-to-day, so recognize that planning for changes in these schedules is essential. If you are a current PHH client, the News and Information section of PHH InterActive is a good source of up-to-date information, and, of course, your PHH account team will be pleased to discuss any specific concerns you might have for your fleet.

PHH has prepared a “Manufacturer Strategy Update – May 2009” White Paper that looks at specific risks and mitigation strategies your fleet can take in light of these unprecedented strains on our motor company partners. Send us an email with your contact information to receive your copy.   

Energy fleets: PHH is blogging LIVE from NAFA!

Fellow Energy Fleets:

If you can't make it to this year's NAFA Conference (April 25-28), then visit our LIVE from NAFA blog to read the latest news and happenings during the conference. Again, visit http://live.phh.com to see pictures, videos, and stories taken during the event.

If you are going to be at NAFA, check the blog after the event to see a recap. We look forward to a great event!

Cheers,
The PHH Energy Team

Save the date - October 22

From PHH Energy Team

If you work in the energy sector and manage fleet, then save the date:

Thursday, October 22

PHH will be hosting its 17th annual Energy Conference in Houston, TX at the Houstonian Hotel, Club and Spa. This is a conference you won't want to miss.

We're currently working on the agenda and would like to know what's on your mind for this year's conference. Please email us your suggestions.

Keep checking back at EnergyFleet.com for more event updates.

Take our survey on “green fleet” initiatives and enter to win a Flip Mino video camera!

By Karen Healey
Director of Product Management, PHH Arval

For the past three years, PHH has surveyed fleet managers on the challenges and opportunities they face in trying to reduce the environmental impact of the fleet. This year has certainly given all of us lots of challenges, and we want to know how this has impacting fleet “greening" especially in the energy industry.

Even if environment is not a priority for your energy fleet, we want your opinion. Click on the link below to take our quick (5 minute!) survey: 

http://www.fleetsurveys.net/se.ashx?s=494072C12A7FC70C

To thank you for your participation, we are giving away a Flip Mino Camera. These are the coolest, smallest video cameras. Yahoo calls it the “world’s simplest video camera.”  If you have never seen one, check out the reviews (and pictures) in Time and Business Week.

But you can’t win if you don’t take the survey – so take 5 minutes and respond today!

Will you shift your focus to vehicle safety this year?

By Karen Healey
Director Product Management, PHH Arval

Did you know that vehicle crashes are the number one cause of work-related deaths?
(Source: http://www.cdc.gov/niosh/docs/2003-119/pdfs/2003-119.pdf)

What can you do to reduce the number of accidents in your fleet?  The answer depends on your fleet and what programs you currently have in place. 

The first thing to do is check your drivers’ Motor Vehicle Records.  Many companies, when they first start a program to check MVRs, find they have some drivers who are operating a vehicle without a valid license.  What if that driver got in an accident and the company ended up in court? Not a position that any of us want to be in and easily avoidable.

Next, look to develop a safety training program.  There are lots of different approaches, from behind the wheel to internet training.  A good, comprehensive program can have incredible results as proven by a small pharma company that was able to reduce their accident rates by 40%. 

View case study

To get these results, they made a real commitment to safety, integrating it throughout their corporate culture. What is holding you back from making a larger commitment to driver safety?

PHH supplier locator expanded to include truck services providers

By Vivek Khosla
Director, Product Management 

PHH's maintenance capabilities for trucks and equipment are making a big difference for companies with trucks in their fleets, and our network of facilities is one of the largest in the nation.

Now, you and your drivers can go to www.phharval.com or PHH InterActive® for Drivers and click on the Supplier Locator to selectively search through categories that include cars, light, medium and heavy trucks, buses and equipment to find the list of appropriate repair shops. The supplier locator allows you to locate repair facilities for routine repairs within a 20 mile radius of any 5 digit zip code to include the category of vehicle. You can filter your selections by one or multiple vehicle categories. The vehicle categories serviced by the supplier will display alphabetically below the suppliers’ address.

It’s an easy and convenient way to find the closest repair facility.

Northeast states to develop a “low carbon fuel standard”

By Karen Healey
Director of Product Management, PHH Arval

Eleven states are working to develop a low carbon fuel standard. What does this mean for fleet?  Not clear yet, but it could be quite exciting.  Here’s the concept: the states require that the fuel in their state use less carbon (and thus have less global warming potential). The fuel companies can use a variety of ways to achieve this new standard. California adopted a low carbon fuel standard in 2007. The Northeast states include: Massachusetts, New York, Connecticut, Delaware, Maine, Maryland, New Hampshire, New Jersey, Pennsylvania, Rhode Island, and Vermont.

The three factors that contribute to greenhouse gas emission from vehicles are fuel economy, miles traveled, and the carbon content of the fuel.  Fleets have the power to work on the first two, and now there looks like there will be some movement on the third.

Interesting information from This Week in Petroleum

By Greg Stanford
Senior Business Consultant, PHH Arval

The Energy Information Administration's This Week In Petroleum for 1/7/09 looks at CY 2007 capital spending trends by the oil sector.
http://tonto.eia.doe.gov/oog/info/twip/twiparch/090107/twipprint.html

Their analysis shows that energy company cash flows are up considerably since 2000, compared to the prior eight years. While this has translated into more capital investment dollars, the ratio of company investments in capital programs to their cash flow has generally been lower. That is, companies have been using their (higher) earnings to reduce debt and pay dividends. EIA's expectation is that both capital investment and financing activities will suffer with the rapid decline in energy demand and prices.

The money quote from This Week in Petroleum:

"The recent sharp drop in oil prices will likely lead to lower cash flow from operations, which will result in reduced funding for both investing and financing activities. Stock repurchase plans can be scaled back quickly and dividends can be reduced to provide additional funding. The long-term debt to stockholders’ equity ratio of the FRS group is at the lowest level since 1981, which provides some room for debt financing.

Investment projects that are far along in development are likely to be completed, but many companies have already indicated that they are planning to reduce capital expenditures in 2009. This may have implications for future supply once the economy recovers and oil demand begins to increase."

EIA's full report "Performance Profiles of Major Energy Producers 2007" is available at this link: http://www.eia.doe.gov/emeu/perfpro/020607.pdf, or you can browse the various sections and tables using this link: http://www.eia.doe.gov/emeu/perfpro/index.html

At 110 pages, this is a very comprehensive look at both the production and refining/marketing sides of the business and is probably worth a look.

U.S. - IRS announces 2009 standard mileage reimbursement rate

Nov-25-2008
The U.S. Internal Revenue Service (IRS) has announced the standard mileage reimbursement rate for 2009. Starting January 1, 2009, the new rate is 55.0¢ per mile.

For more information, please see the following IRS press release: http://www.irs.gov/newsroom/article/0,,id=200505,00.html