Buying fleet vehicles part 1: Do you know the TCO?

June 9, 2017
When it’s time to decide on a fuel for your new fleet vehicles, the choice is not so simple.

When a Granny Smith apple costs $1.79 a pound and a Macintosh just 99 cents, it’s easy to compare one apple to another. But when it’s time to decide on a fuel for your new fleet vehicles, the choice is not so simple.

With different fuels burning at different heat energies, comparing miles-per-gallon ratings of fuels such as gasoline, diesel, propane autogas and natural gas isn’t conclusive. To achieve a true side-by-side comparison, you must look at the total cost of ownership (TCO) between various vehicles and their specific fuel.

Here are some factors that come into play for TCO:

  • Initial vehicle price
  • Alternative fuel system conversion costs (if applicable)
  • Fueling infrastructure
  • Vehicle maintenance
  • Fuel costs
  • Fuel efficiency
  • Number of annual miles driven
  • Vehicle cost per mile
  • Vehicle warranty

Figuring the initial vehicle price is fairly straightforward. Your dealer will provide those costs depending on what type and how many of the vehicles you plan to add to your fleet. Many alternative fuel vehicles can be ordered directly through an OEM dealership. For instance, propane autogas trucks with ROUSH CleanTech fuel systems can be ordered directly through a Ford dealership and come with the full Ford factory warranty. And you might be surprised to learn that purchasing a new vehicle equipped with a propane autogas fuel system, rather than gasoline or diesel, may not add much to the initial cost of that vehicle.  

You can also purchase new vehicles and have them retrofitted to take advantage of the benefits of an alternative fuel. Just be sure to add the cost of that retrofitting to your total cost of ownership estimate — and be aware that changes made during retrofitting may void the vehicle’s warranty.

Although fuel costs vary, your past usage records or average cost information provided by a fuel supplier can help you pin down the fuel portion of TCO. We’ll take a closer look at fuel and infrastructure costs in our next post in this series. Our final post in this three- part series explains how online calculators can help when determining TCO so you can make the best possible decisions for your fleet. Be sure to check them out, and join the conversation here.

About the Author

Joe Thompson | Group President, Roush Products Group

Joe Thompson is group president of Roush Products Group, working within the corporate structure of Roush and overseeing ROUSH CleanTech and ROUSH Performance Products. He is a member of the Roush Enterprise Steering Committee. 

Previously he served as president of ROUSH CleanTech, growing the company from six employees to more than 90. Under Thompson’s leadership, ROUSH CleanTech won numerous quality control and environmental awards, including Supplier of the Year from Blue Bird and a Michigan Green Leader honorable mention. He is a recipient of the 2013 Green Fleet Sustainability All-Star award.

Thompson has worked with Roush since 1996. In his previous appointment as vice president and general manager, he helped establish ROUSH Performance as one of the premier brands in the automotive aftermarket segment.  

Raised in Ohio, he earned a degree in public relations from Ohio University’s Scripps School of Journalism. He lives with his wife and two sons in Ann Arbor, Mich.

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