Date Published: Aug. 1, 2017, 10:19 p.m.
T
his case study shows how besides offering incentives to private car-sharing initiatives to improve citizen mobility, local governments can also adapt car-sharing programs to their vehicle fleet management program. Traditional government vehicle fleet management plans are often resource-heavy and costly, and prone to misuse and underutilization. To address this difficulty, local governments have been collaborating with car-sharing companies to improve their fleet management services. This case study presents the experience of the city of Chicago has worked with ZipCar and its FastFleet programme to reduce cost in the municipal fleet management. Since 2011, the City of Chicago has been using car sharing (Zipcar) and car pooling (FastFleet 2011-2018, Merchants Fleet / Keaz 2018-) to reduce the number of City-owned vehicles that are used for administrative purposes. Car sharing allows the City to use vehicles alongside the public, at reduced rates. The main challenge has been changing the culture of having dedicated vehicles for personnel. Car pooling allows drivers to share city vehicles as needed. It is especially useful when car sharing’s geographical and versatility limitations cannot meet a need (examples – locations away from downtown, and the need for cargo vans and pickup trucks).
Car sharing is used primarily downtown for administrative purposes.
Vehicle pooling is used by tradespeople throughout the City
Over 1000 city employees utilize the car sharing and pooling programs.
Starting date : 01/06/2011
Ending date : on going
Car sharing – Contract is expiring this year. New bid is advertised.
Vehicle Pooling - Transition from FastFleet to Merchants Fleet is in process.
Zipcar, one of the main car-sharing companies in the USA, offers two programs to improve local governments’ fleet management, and have collaborated with a dozen local governments since 2011 to implement its solutions. In the first program, local governments can purchase discounted memberships for their employees to use Zipcar’s existing fleet of vehicles at reduced hourly rates. The second program, known as FastFleet, consists in the implementation of a fleet sharing and management system, to the existing government’s fleet. FastFleet combines hardware and software technology components. City vehicles are equipped with GPS devices, on-board telematics control units, card readers, antennae and wiring integration, and city employees are supplied with RFID-based access cards. A management software, city branded and fully hosted, is implemented to administer reservations and track fleet users, among other logistical tasks.
The implementation of such as program includes benefits such as: a reduction of fleet size and increase in the usage of vehicles; a reduction in greenhouse gas emissions thanks to more fuel efficient cars and fewer vehicles being used; significantly lower capital and operational costs due to an increase in management efficiency; and increased accountability and transparency from departments by avoiding misuse of cars by employees resulting from the tracking system deployed in the vehicle fleet.
The City of Chicago, which signed a 5-years contract with Zipcar in 2011, was the first municipality to implement a combination of both the car-sharing program (where the contractor provides the vehicles) and the carpooling approach (where the city uses the online reservation technology tool in their own vehicles). Zipcar made available a web-platform management tool that can be adapted to the city’s needs, by allowing the city to register all its owned vehicles, manage reservations, track location, monitor usage and maintenance, and pull up reports.
The program brought important financial savings for the administration: for each vehicle reduced, $6,000 USD were saved per year, which means around $950,000 USD per year. Part of the savings are related to the fact that the program also has reduced the need to pay for parking downtown, which previously cost the city roughly $200 per month per vehicle (the equivalent of approximately $200,000 per month). The Zipcar/Flex Fleet program is 25 cents per mile cheaper for the city compared to the city-managed fleet. Overall, the reduction of the motor pool through car sharing has yielded roughly $6.2 million USD in savings since it started, which means a 15% reduction in operating costs every year. Return on investment of the program is impressive as the total expenditure of the city has been $800,000 over the life of the contract. These expenses covered the hourly Zipcar charges as well as the FastFleet installations.
Currently, Chicago has 120 city-owned vehicles managed through Zipcar’s FastFleet carpooling program, out of a 650 vehicle non-emergency, light duty fleet. More than 1.200 city employees have signed up to use the shared fleet and about 400 city employees have signed up for Zipcar memberships, where cars scattered across the city are shared with regular Zipcar members. Chicago has seen its overall fleet decrease in size from 1.000 cars before the program’s implementation to about 650 vehicles in 2016, equalling a 35% reduction. The program brought important financial savings for the administration: for each vehicle reduced, $6.000 USD was saved per year, which means around $950.000 USD per year. Part of the savings are related to the fact that the program also has reduced the need to pay for parking downtown, which previously cost the city roughly $200 USD per month per vehicle, the equivalent of approximately $200.000 USD per month. The Zipcar/FastFleet program is 25 cents per mile cheaper for the city compared to the city-managed fleet. Overall, the reduction of the motor pool through car sharing has yielded roughly $6.2 million USD in savings since it started, which means a 15% reduction in operating costs every year. Return on investment of the program is impressive as the total expenditure of the city has been $600.000 over the life of the contract. These expenses covered the hourly Zipcar charges as well as the FastFleet installations.
According to Kevin Campbell, Manager of the City of Chicago Fleet Services, the main difficulty encountered when implementing the car-sharing and car-pooling project with Zipcar was the resistance from employees and departments, who were accustomed to having vehicles at their disposal. With the FastFleet program, they had to get used to sharing the vehicles with 25 other departments.
To ensure transition to the new system, it was key to create the demand by removing all the non-essential vehicles the employees used before, and only gradually adapt the new system to the actual demand. According to Kevin Campbell, “If you create the new system in parallel of the existing one, employees will keep using the old service and the project will have no impact. What we did was to impose the new system as the only option and wait for employees to say if the new system was adapted to their needs or not. And when, Zipcar car-sharing fleet was not enough, we included the FastFleet car-pooling program.” To face employee resistance, the city had to adapt the offer according to the employees’ needs: employees with short-term and short-distance vehicle needs are encouraged to use Zipcar, while those who have out-of-town business or need a car for a longer period are pushed in the direction of FastFleet.
To ease the shift to the new system, strong communication towards municipal employees of all departments and training programs were key to ensure the understanding and support to the project. As stated in the contract with the municipality, Zipcar organized regular training sessions addressed to employees that will drive the vehicles and city officials that will administrate the management interface, to help everyone get through orientation and sign up with the program.
Another challenge with the program was that the contract with Zipcar was short-term. Which means that, now that the 5 years’ contract is about to expire, the city will need to renew the contract with Zipcar, or consider other companies that offer similar services. However, as the city does not own the infrastructure, changing provider represents a break transition, as the city would have to change hardware from vehicles, change website, membership cards, etc. An option for the municipality could be to develop its own software management system, in order to ensure the sustainability of the project. However, the monthly fee structure of the contract has minimized Chicago’s infrastructure investment, and allows for the consideration of other options now that the initial contract is coming to an end.
• Make sure all startup and operational costs are included in your budget BEFORE you initiate the program
• Do not pass any costs on to your customers
• Sign up fees
• Usage fees
• Focus on occasional use applications
• Reduce your fleet size to accomplish savings
