Focus on chauffeur fleets: Cutting costs without cutting service
Changes to the Congestion Charge, plus the implementation of the London Ultra Low Emission Zone (ULEZ), together with a national framework, are all putting added pressure on UK chauffeur fleets. Martyn Collins talks to established companies, Brunel and Tristar, to see how they are making savings.
Addison Lee began in 1975 with taxis and is now in 350 cities worldwide carrying over 10 million passengers. Tristar, its chauffeuring arm, was launched in 2002 and offers business and leisure services. There are roughly 1,000 vehicles in the Tristar fleet, made up of Mercedes-Benz models including
E-Class saloons and estates, plus S-Class and the V-Class MPV. This Tristar fleet is part of the wider Addison Lee Group fleet of 5,000 vehicles, in the UK and globally.
It has a mix of self-employed and employed drivers, again booked by its own app. Addison Lee has taken the decision to manage most of its services in-house, including workshops and driver training, to ensure it has full control over cost, efficiencies and operational effectiveness. It works.
Addison Lee has long been an innovator in the chauffeur industry, picking up many trophies. We spoke to Justin Patterson, head of operations at Addison Lee Group at the time of interview, and the current recipient of our Eco Superstar award, presented at this year’s Great British Fleet Event.
How are you making savings with your chauffeur fleet?
“It’s all about utilisation and optimisation. We focus on vehicle utilisation targets linked to ensuring we have the right vehicle in the right place at the right time. This focus has resulted in the fleet being leaner and being able to reduce the number of vehicles previously required.
“This includes reviewing the shift patterns for our chauffeurs. We do this through a dedicated resource planning and control system within the Tristar business, in addition to our allocation dispatch solution, which uses complex algorithms to dispatch work fairly and efficiently across the fleet.”
Are you keeping your vehicles longer on average?
“Yes – we regularly review TCO modelling and we’ve ascertained the optimal vehicle lifespan within our fleet is now 36 months; this has increased from our previous hold position of 24 months. This applies across our luxury vehicle fleet including the Mercedes-Benz S-Class and E-Class through to V-Class MPVs.”
Are you changing the way you’re buying or funding the fleet?
“In the last couple of years, the Addison Lee Group has moved to a leasing funding panel. This provides a competitive tender process, to ensure we’re getting the optimal pricing package and in turn has realised savings through this process.”
Has the way you maintain your fleet changed?
“We’ve adopted a hybrid approach to maintenance – to get the best value depending on location and volume.
“Located within an hour of London, all of our vehicles are maintained through our own workshops, and in the rest of the UK we have a network of approved suppliers that work on our fleet. This is reviewed and monitored as the size and shape of the operation changes.”
Is ULEZ having an effect on what vehicles you’re choosing?
“Earlier this year, the group invested £41 million to complete a fleet that is compliant with Transport for London’s ULEZ, which came into force on 8 April 2019.
“As we approach Phase 2 of ULEZ in January 2020, we are actively engaging with OEMs on the right specification for plug-in hybrid vehicles that meet the requirements.”
What are Tristar’s plans for alternatively-fuelled vehicles?
“We’re currently trialling the fully electric Audi e-tron within our Tristar fleet, and plan to have an entirely zero-emissions capable (ZEC) fleet by the end of 2022.
“Our company will consider both plug-in hybrid vehicles (PHEV) and battery electric vehicles (BEV) from a range of manufacturers.
“We currently operate start/stop technology on all vehicles within our fleet, resulting in zero tailpipe emissions when stopped at junctions or in traffic. All cars are tracked and have full vehicle telematics, which enable us to monitor the driver, the vehicle and the journey. This in turn provides benefits to the customer in terms of safety and security along with environmental benefits of optimal journey planning, reduced mileage, fuel and emissions.”
What do you think are the obstacles to Addison Lee adopting a full chauffeuring EV fleet? If you are planning on adopting a full chauffeuring EV, how far away do you envisage this being?
“We are keen to move quickly to a zero-emission capable fleet for the benefit of London’s environment. While we welcome the Mayor of London’s recent pledge to develop five EV hubs across the capital, we require a more transformational programme to support the shift to ZEC.
“In September 2017, an ALG (Association of London Government) commissioned report recommended that over 8,000 rapid chargers are required in London if the entire taxi and PHV (private hire vehicle) industry is to shift to ZEC and EV.
“Our e-tron pilot partnership with Audi will help inform the EV infrastructure in London. It’ll give us real-world examples of where our chauffeurs have needed to charge and where they have been able to charge. It also gives us a crucial insight into how reliant we might or might not be on the rapid (50kW) chargers, compared to the standard (7kW) chargers.”
Originating in London back in 1982 as a chauffeur service, Brunel is now a part of the Europcar Mobility Group. It also encompasses a worldwide roadshow, event management, taxi and private hire service.
Its chauffeuring business is split into first, business and economy classes, which can be booked via Brunel’s own app. First class offers a distinctly personal service, with a specifically trained chauffeur.
In terms of fleet, Brunel’s is made up of 100 Mercedes-Benz E-Classes, 10 Mercedes-Benz Vianos, 10 Mercedes-Benz S-Classes, 10 Volkswagen Sharans, plus 170 economy cars of various makes, all driven by a full-time staff of drivers. The rest is made up of a fleet of another 1,200 economy cars and drivers who work for Brunel on a part-time flexible basis.
Fleet World asked Michael Smith in operations at Brunel about how it’s controlling fleet costs in the current environment.
How are you making savings on your chauffeur fleet?
“We are in a fortunate position where our parent company Europcar allow us to purchase/lease cars, with the buying power and economy of scale that comes with our parent company’s key strengths. We can now negotiate directly with manufacturers, meaning we get exactly the cars we want, all at a price that is far better than if we approached them using only Brunel’s position.”
With the current political uncertainty, are you planning on keeping your fleet longer?
“The length of time we keep the cars hasn’t changed at this point, as we have standard two-year leases on all of them.”
Are you changing the way you’re buying or funding the fleet?
“As part of the Europcar Mobility Group, our model has not changed.”
Is the ULEZ having an effect on what vehicles you’re planning on buying?
“Yes, for sure. We are actively looking for an electric/plug-in hybrid to combat the ULEZ changes that are coming in from 2021.
“At the moment, all of our fleet are Euro 6 diesels, so it has given us a little respite from having to implement any radical short-term changes. However, with the rules changing in 2021, our current fleet will not comply, and more than this a lot of drivers are now looking for a fully electric or plug-in option.
“We are slightly cautious about EVs at the moment, as the simple facts are that the electric charging network is still not really there, and most hybrid models depreciate like a stone. There is still work to be done by the manufacturers to produce a cost-effective solution to fleets like ours.”
Are you looking at alternatively-fuelled vehicles?
“Yes, we are. We currently still have three Toyota Mirai cars on the fleet that rely on hydrogen power. For me these represent a much more realistic future of motoring, as hydrogen is cheap and is as quick to fill up with as petrol.
“The issues with hydrogen at the moment are the costs of cars, and a lack of filling stations. I would love to look at solar-powered vehicles, but I think I may be wishfully thinking that we live in sunnier climates!”
Super savers: Ways to cut fleet costs
CHANGE THE WAY YOU FUND: Choose a leasing funding panel; this should ensure you’re getting the optimal price for your vehicles.
FIND THE OPTIMUM LENGTH OF TIME TO KEEP YOUR FLEET: Look at the total cost of ownership model, then find the optimal lifespan for each vehicle on your fleet.
LOOK AT THE WAY YOU’RE MAINTAINING VEHICLES: Could you establish a network of suppliers? Thus, getting any maintenance work done cheapest and quickest?
MAKE YOUR FLEET ULEZ-COMPLIANT: In the first instance, make sure they’re Euro 6-compliant. Then, start planning for a full EV fleet.