Fleet asset management: how to do it and benefits

Vehicles are among a fleet’s most valuable assets because they are indispensable tools for transport operations. That is why asset management has emerged as a fundamental activity.

Unlike vehicle management, which aims to keep vehicles fully operational for as long as possible, asset management focuses on extracting value from the assets concerned.

Take a look below to learn more:

What a fleet asset is;
What asset management is and what it is for;
Why fleet asset management matters;
How to manage fleet assets.

What is a fleet asset?

The term “assets” can refer to any company property, tangible or intangible. This ranges from fleet vehicles to the tools and systems used to control transport operations.

In fleets, the asset is generally a vehicle. However, other items, such as tires, inventory parts, warehouse equipment and so on, can all be considered transport operation assets.

What is asset management and what is it for?

Asset management is a way of controlling fleet property to prevent loss, damage or breakage. For company vehicles, this means carrying out maintenance and inspection routines, controlling services performed, managing risks, etc.

This fulfills the goal of this type of management: ensuring the amount invested in purchasing the asset is preserved and returned to the fleet.

How do you manage fleet assets?

Take an inventory of assets

Knowing your assets and their details is very important when starting a management plan. This is what an inventory count aims to do: identify each vehicle and build a database with detailed information such as make, model, year, mileage covered, documentation, and so on.

Adopt an asset management and control solution

A maintenance system, for example, is the best type of technological solution for seeing which vehicles belong to the fleet, understanding their availability, number of services performed, costs by license plate and much other crucial information to optimize your asset management.

Keep track of asset life cycles

Understanding each fleet vehicle’s performance from purchase to “disposal,” whether it reaches a stage of inactivity or it is simply time for fleet renewal, helps identify the best vehicles for the transport operations performed.

A cost-per-kilometer calculation for each vehicle can be used for this.

Have qualified professionals

To keep a vehicle in good condition, drivers must understand the importance of their role. They are responsible for driving, which directly affects vehicle condition, and generally should carry out a daily inspection checklist on these assets to identify occasional issues.

If they do not fulfill their obligations, your assets may lose useful life or become more problematic and costly to the company.

Consider legislation and technical standards

Following the laws and technical standards established for each vehicle type, fleet and operation is fundamental to preventing a loss of quality in your company’s service. Each manager should know which rules apply to their company.

Have a maintenance plan

Maintenance is a stage that cannot be neglected in asset management. It ensures vehicle condition and corrects issues whenever necessary.

Asset maintenance also generates a history of issues and budgets used, contributing to highly accurate demand forecasts and generating information for tools such as a fleet fault tree.

Therefore, keeping track of asset health and identifying the issues you face in your operation is the best way to identify solutions that will actually bring satisfactory results to your company.

Evaluate the results of your actions

Currently, data-driven management is one of the biggest trends in transport because what happens in each operation is individual, and actions will have different results under different conditions.

As you implement actions, metrics should be established so data is continuously collected and analyzed to verify whether those actions had the expected effect or you need to make improvements.

This is summarized in the method known as the “PDCA cycle”: plan, execute, check and analyze.

Why does it matter for fleets?

Carrying out this type of fleet control helps ensure operational time and money are well used. Fleet managers benefit when items with high purchase costs, such as vehicles, perform as well as possible and last longer.

Furthermore, good asset management generates benefits such as:

Increased productivity

Keeping servicing and maintenance up to date is one of the activities defined by fleet asset management, and it is fundamental to ensuring vehicles function properly.

This means fewer issues and unexpected events occur on fleet routes and trips, generating greater productivity in daily operations.

Reduced operating costs

Besides greater productivity, this care for fleet assets reduces operating costs. This happens in several ways:

Maintenance cost savings, since there are fewer issues involving unscheduled services.
Lower tire replacement costs, because tires last longer when inspected more frequently and inflated according to their identified ideal pressure.
More efficient fuel consumption, since maintaining ideal driving conditions, with the vehicle and tires in perfect condition, ensures fuel burns in the most appropriate way and also produces savings in this area.

Predictability in decisions

Asset management processes place greater emphasis on collecting and analyzing asset data. This allows more concrete decisions and accurate forecasts for asset replacement, purchasing, refurbishment or other activities.

Better risk management

When seeking greater value from fleet assets, more attention is also given to the risks they face. Even more important is knowing which solutions to adopt for each hazard.

Possibility of fleet expansion

By adopting an asset management routine and achieving the expected results, you can start directing the savings generated toward, for example, planning and carrying out fleet expansion.

More efficient vehicle depreciation control

Since extracting value from fleet property and improving investment returns are among this type of management’s main interests, vehicle depreciation will receive more attention than ever.

Actions to prevent depreciation and ensure resale values are identified and begin to be applied daily in your operation.

For an even better understanding, see our free, comprehensive resource on “How to use fleet management to increase productivity and savings.” Download it here (in Portuguese).

Frequently asked questions

What is the difference between asset management and vehicle management?

Both look after the same fleet, with different goals. Vehicle management exists to keep each vehicle fully operational for as long as possible. Asset management targets the asset’s value: ensuring the amount invested in its purchase is preserved and returned to the fleet. That is why it considers inventory counts, life cycle, depreciation and resale value alongside maintenance, inspection and risk management routines.

What counts as an asset in a fleet?

An asset is any company property, whether tangible or intangible. In fleets, the most immediate example is a vehicle, but the list extends to inventory parts, tires, warehouse equipment and even the tools and systems used to control transport operations. Recognizing this whole set makes a complete inventory count possible, item by item, with make, model, year, documentation and mileage covered.

How do you start managing fleet assets?

With an inventory count: identify each vehicle and gather its make, model, year, documentation and mileage covered into a database. Then adopt a management solution — a maintenance system shows which vehicles make up the fleet, each one’s availability, how many services have been carried out and costs by license plate. Next come life cycle oversight, the maintenance plan and evaluation of results.

My vehicles are losing value too quickly — what does asset management solve?

It places depreciation under scrutiny. Since extracting value from assets and improving investment returns are among its main interests, measures that slow depreciation and preserve resale value are identified and incorporated into routines. Keeping track of each vehicle’s life cycle, from purchase to disposal, and calculating cost per kilometer shows which vehicles best suit the operations performed.

What does the fleet gain by treating vehicles and tires as assets?

Good asset management increases productivity because up-to-date servicing and maintenance reduce issues and unexpected events on the road; reduces operating costs, with fewer unscheduled services, tires lasting longer through frequent inspections and calibration to the ideal pressure, and more appropriate fuel combustion; provides predictability in replacement and purchasing decisions; improves risk management; and generates savings that can be allocated to fleet expansion planning.

How do you know whether asset management actions are working?

By establishing metrics beforehand and collecting data continuously, to verify whether each action had the expected effect or still needs improvement. This is summarized in the PDCA cycle: plan, execute, check and analyze. Remember that results are specific to each operation — the same actions will produce different results under different conditions, which is precisely the argument for measuring rather than assuming.

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