Gas and diesel prices are skyrocketing worldwide. This has, in part, been fueled by the globe rebounding from the COVID-19 pandemic, as well as Russia’s war in Ukraine. Furthermore, gas and diesel prices are a complex equation of the cost of crude oil, taxes, the purchasing power of a country, government subsidies, the exchange rate (if the country you’re in imports energy) and more. This makes it difficult to anticipate what the costs will be from month-to-month and budget accurately, as these factors are all unpredictable.
For companies that rely on their fleets and transportation for their livelihood, fuel prices that keep increasing and fluctuating can have a huge impact on day-to-day operations and make it difficult to plan ahead or to future-proof a fleet. This is why more and more fleets are utilizing fleet management and telematics solutions to measure fuel consumption and reduce it.
One of the main reasons that fuel saving is so important is to reduce overall operating costs. It’s a known fact that fuel is one of the largest total costs of ownership expense and can represent up to 60% of a company’s fleet operating budget. In a report by Frost & Sullivan, a notable global research firm, it was noted that fleets using telematics devices can expect as much as a 25% decrease in fuel costs. Since significant fuel savings are proven to be possible for fleets of all sizes and in all industries, those savings can be passed on to other fleet-related areas and customers are likely to feel residual benefit, which leads to increased loyalty and retention.
Not only is fuel savings important from a cost perspective, but it is also crucial when taking into consideration the fact that high fuel consumption is linked to harmful carbon dioxide emissions. Carbon emissions have a negative impact on the environment. But why is that? When greenhouse gases, which include the carbon dioxide emitted by vehicles, are released into the atmosphere they trap the sun’s heat which warms the average global temperate and causes it to rise. This is known as global warming. This radiation or heat formation should be escaping into space but unfortunately, that’s not happening.
Warmer temperatures result in changing weather patterns, disrupting the natural balance of nature. Not only does this result in a hotter planet but more severe storms, increased drought, less food production, a rising ocean due to melting ice sheets, loss of species critical to biodiversity and increased diseases (such as malaria). Not only are unusually high carbon emissions causing environmental damage, but it is also damaging human health by increasing air pollution.
Transportation is one of the six main sources of harmful greenhouse gas emissions, accounting for 28.9% of all emissions worldwide. The amount of CO2 a car emits is directly related to the amount of fuel it consumes. For example, according to the EPA, a typical passenger vehicle emits about 4.6 metric tons of carbon dioxide per year. For every one mile driven, a total of 404 grams of CO2 is emitted. When it comes to, for example, freight trucks, they emit 161.8 grams of CO2 per ton-mile.
Countries, organizations, and individuals around the world are placing a magnifying glass on their carbon footprint and finding ways to reduce it. Governments across the globe are setting environmental targets. These targets tend to fall into two categories:
What’s more is that reducing your carbon emissions by saving fuel is not only good for the environment but also good for the communities within which you operate. Less air pollution from transportation leads to better air quality for people who must be on the roads all the time.
In addition to fuel saving lending itself to reduced fleet costs and reduced carbon emissions, it can also help you to increase the lifespan of your existing vehicles. One of the reasons a fleet may be experiencing high fuel consumption is drivers driving excessive miles. Of course, driving long distances may be unavoidable in some cases, but if you implement measures to limit these miles, you can reduce fuel usage and, in turn, limit the wear and tear on fleet vehicles. So not only does fuel saving help save you money and benefit the environment, but it can also reduce the costs related to vehicle repair and lessen the number of times you need to replace existing vehicles.
So, in summary, fuel saving is important for your fleet because it: