January 2018 Newsletter
Fleet used vehicle prices stay high in 2017
Wholesale used vehicle prices increased for six consecutive months in 2017, producing an 8.1% year-over-year rise. Even passenger car pricing—recently dampened as consumer demand shifted toward utility vehicles—enjoyed a rebound. According to Manheim, some of this pricing strength can be attributed to Hurricanes Irma and Harvey, which affected supply by removing about 1 million vehicles from the marketplace.
Pump prices increase as demand grows, new taxes take effect
The cost of a gallon of unleaded gasoline rose $.09 to $2.56 in the week ending November 13. This represents a $.39 per gallon increase compared to the same time last year. Diesel prices increased as well, up $.12 to $2.91/gallon, a $.47 jump year-over-year.
While some of the increase is related to growing consumer demand, recently imposed taxes also had an impact. In California, for example, the Road Improvement Tax (effective November 1) boosted prices by $.12/gallon.
Industry experts anticipate a gradual easing in fuel prices as we enter the winter season.
Telematics costs decrease, while ROI gets on a roll
As telematics devices started to gain traction in 2007, the benefits centered primarily on asset tracking and route optimization. That made it difficult for many fleet operators to justify the cost of purchasing and installing the devices.
Ten years later, the situation has changed dramatically. According to an article published in November by Automotive Fleet, new telematics capabilities are generating valuable benefits for many functions across almost any organization that uses vehicles:
- Productivity - Add-on apps offered in the Geotab Marketplace (among other resources) continue to make field drivers more productive in handling daily routines.
- Safety - Devices now offer easy ways to measure and manage seatbelt use, speeding, harsh braking/cornering, and other actions that affect safety. Innovative “gamification” features allow employers to reward good behavior as well as discourage unsafe behavior.
- Compliance - Data collection capabilities simplify the administrative challenges associated with new federal mandates such as ELD. Devices used in a “connected” system can also automate tasks related to business/personal use reporting, IFTA, and HOS, among others.
- Maintenance - Devices can now read onboard vehicle computers to apply predictive analytics. These smart systems then provide alerts for recommended maintenance before dangerous or disruptive failures occur.
In addition, as telematics technology scales to wider adoption in the marketplace, pricing levels for devices and related services continue to fall. Analysts predict that all vehicles eventually will be connected via telematics, making customized “use case” bundles available for virtually every fleet vehicle on the road.
IIHS reveals Top Safety Picks
The Insurance Institute for Highway Safety (IIHS) has released its top picks for vehicle safety, with models from Toyota, Chevy, Buick and Ford among those topping the 2017 list. The comprehensive analysis considers every category of vehicle, from “mini-cars” to half-ton pickups.
Of particular interest to fleet managers: The IIHS analysis considers not only crashworthiness, but also accident avoidance capabilities—made possible by specific combinations of standard and optional equipment.
Click here to download the full IIHS Study:
Mid-size sedans continue plunge in popularity
The great migration continues: Consumer preferences are shifting dramatically from mid-sized cars to compact utility vehicles and pickups. In October, mid-size segment sales totaled 130,000 units in the US, a 16% decline versus same period last year. Since 2012, the segment’s market share has fallen from 17% to 9.5%.
Within the segment, only the 2018 Honda Accord posted a gain over prior year.