Historically, over-the-road fleet managers have had more success in solving their maintenance and technology issues than vocational fleet managers - despite the fact that both groups operate similar equipment, says Vince Fortuna, vice president of fleet services for Waste Management Inc. (WMI), Houston.
A 37-year veteran of the transportation industry who began his career pumping fuel for a New Jersey transportation company, Fortuna recently sat down with Waste Age at a The Maintenance Council (TMC) meeting to discuss what vocational fleet managers and over-the-road fleet managers could learn from each other.
First and foremost, Fortuna stressed that industry leaders should work together to help waste management fleet managers reach the same level as companies managing over-the-road fleets in areas such as technician recruiting, equipment technology and resale. He also called for the support of industry organizations such as the TMC of the American Trucking Associations (ATA), Alexandria, Va.
"Last year I was given the opportunity to develop the Fleet Strategy and Systems for the world's largest waste hauling company," Fortuna says, noting that Waste Management is a $12 billion company with more than 68,000 employees, 50,000 hauling and support vehicles, and 5,000 pieces of heavy equipment in 23 countries. "Our objectives are the same as every fleet operator's: maximum utilization, improved productivity and reduced costs."
He notes that for vocational fleets, as with most fleets, planned maintenance is the foundation for service reliability, fleet productivity and customer service. Service reliability is critical because waste collection is a just-in-time business. Just ask your customers, he says.
"It doesn't take long for customers to notice their trash was picked up late or missed completely," he explains. "When an average vehicle picks up garbage from 1,200 homes a shift, it's almost impossible to go back and pick up yesterday's work."
Fortuna suggests the ATA and TMC can use their power to help improve fleet operations. "As a market segment, vocational fleets have not been getting the vehicle development from the original equipment manufacturers (OEMs) we need," he says. "Research indicates that vocational vehicles represent approximately 22 percent of an OEM's production annually and 40 percent of their total profit margins."
But, he says, there is not enough information sharing between the OEMs and the industry, for example in new technologies for vocational fleets. He also says vocational fleet-specific maintenance and repair processes could help reduce operating costs.
"We need vehicle and systems development for the vocational fleet vehicle of the future," Fortuna says.
Fortuna believes vocational vehicle profits are subsidizing over-the-road vehicle development. "This would be acceptable," he says, "if vocational vehicles were receiving the benefit of technology. The monies for development of technologies such as ABS and electronic engines were made available only when the law required the changes. In 1998, we were still receiving mechanical engines that hadn't been installed on over-the-road vehicles since 1988."
While refuse body manufacturers are improving technology for the industry by using single platform assembly lines and professional engineering groups, Fortuna says refuse body development can be accelerated.
"Proven technologies that have been the standard for decades on over-the-road fleets are only now being incorporated into vocational fleets," he says.
For example, drive train synthetic lubes, disc wheels, air conditioning and electronic control systems only have become standard this year, he explains. Perhaps no one has asked for these technologies. Perhaps mom-and-pop companies felt the price was too high, so the technologies were not needed.
"But now our industry is in a transition phase where competition and competitive rates are reducing our margins," he says. "This is forcing us to address our cost structures and processes that the over-the-road industry has been fighting for years." The transition also is creating a new crop of professional vocational fleet maintenance managers, and these new professionals will be looking for support in the future, Fortuna adds.
The challenges for vocational fleet maintenance will continue to be great, he says. "We will always work in harsh environments, our applications are severe and a lot of money always will be spent improving fleet utilization." Nevertheless, the industry needs to help vocational fleets get up-to-speed with their over-the-road counterparts and reduce costs, relative to over-the-road cost structures, he adds.
Lessons to Learn Meantime, vocational fleet managers can take advantage of the issues that both groups share. For example, vocational fleet managers can learn from their over-the-road counterparts about vehicle resale.
"Over-the-road vehicle managers already enjoy a developed customer base and excellent residual values," Fortuna says, adding that vocational fleet managers are not that fortunate. There is no established network for resale and market value pricing for vocational equipment.
"This is a huge opportunity for our industry," he continues. "We should mirror the over- the-road truckers and create a resale network and customer base that will give vocational fleet owners better options for depreciation according to application."
According to Fortuna, the depreciated life of the waste vehicle currently is approximately twice as long as an over-the-road vehicle. This is because of the lack of a resale market as well as the initial investment cost of a refuse truck, which, according to Fortuna, is about twice that of an over-the-road Class 8 truck. Consequently, to provide customers competitive rates, companies are forced to depreciate equipment longer, he says.
Vocational fleet managers also can pick up tips on routing from their over-the-road counterparts. "Routing is still in the dark ages for most garbage companies," Fortuna says. "Given the overweight potential, changing traffic patterns and seasonal issues, routing is necessary. But the kinds of technology and professional systems prevalent in over-the-road fleets do not exist in the waste disposal industry."
Another issue all fleet managers face is recruiting and retaining quality technicians. "When we do find them, it's hard to keep them because of non-competitive wage structures and better working conditions outside of our industry," Fortuna says. "Both of our operations usually require that the technicians work nights and weekends, sometimes in inclement weather."
To solve this issue will require joint resources, he adds. "This is a critical issue. We need to take ownership and action needs to start today."
Cooperation from the Beginning Overall, Fortuna says that the problems faced by the waste industry's fleet managers can be solved with help from all equipment industry groups working together. While over-the-road fleet managers can provide useful tips, vocational fleet managers also have a lot to offer.
"We feel that sharing knowledge within cross-functional task forces and study groups will make total transportation services stronger," he says.
For example, the ATA can lobby for support and regulatory improvements that cover all transportation fleets.
The Society of Automotive Engineers (SAE) also can help engineer new technologies and productivity improvements for vocational fleets - improvements that are in the forefront with over-the-road vehicles and not afterthought requirements, he says.
"The power of these groups will only enrich and strengthen this [industry] as a whole."
Now is the time to start using alternative fuels. That was the message of Vince Fortuna, vice president of fleet services for Waste Management Inc., Houston.
According to Fortuna, the strategy of clean air environmental groups is focused on fleets that operate totally within city boundaries and residential communities where those groups can influence change. This strategy eventually will affect fleets that work in major cities, causing more fleet managers to rely on alternative fuels.
Additionally, the U.S. Environmental Protection Agency (EPA), Washington, D.C., is stepping-up roadside inspections for emissions and smoke from coast to coast.
The California legislature also currently is trying to pass a law that classifies diesel smoke as a carcinogen. To address upcoming regulations, Waste Management is planning to put more alternative fuel vehicles in its fleet. "We currently have natural gas vehicles (NGVs) operating in four districts in California, one district in Pennsylvania, and soon Houston," Fortuna says. "We have received a grant from California to add 141 additional NGVs between the year 2000 and 2001."
By bringing alternative fuel vehicles to the forefront and establishing study groups to develop vehicle standards and systems specifications, Fortuna says fleet managers can learn to manage costs until the roads to alternative fuel solutions become clear.
A typical over-the road commercial Class 8 vehicle has:
* 12- to 14-liter diesel engine;
* 350 horsepower (hp) to 400 hp;
* 6.5 miles per gallon to 7 miles per gallon;
* Operates at maximum of 1,800 revolutions per minute (rpm) less than 10 percent of the time
* Costs $110,000, depending on specifications;
* Seven-year economic life with significant resale value;
* Extended maintenance intervals up to 50,000 miles;
* Maintenance operating costs between $3,000 and $5,000 annually; and
*Cab with noise insulation, ergonomic dashes and seats, and additional amenities such as communications, entertainment and sleeping compartments.
A typical refuse Class 8 vehicle has:
* 10- to 12-liter diesel engine;
* 300 hp to 350 hp
* 1.5 miles per gallon
* Operates at a maximum of 2,200 rpms 80 percent of the time, powering hydraulic systems that move packing blades, compaction systems and lifting arms;
* Costs $165,000 to $200,000, depending on the application;
* Eight- to 10-year economic life with no established resale network or values;
* Maintenance performed every two to three weeks, with brakes, tires, electrical and hydraulic system components as the highest maintenance costs;
* Maintenance costs of $25,000 to $30,000 annually; and
* Cab designed for work productivity.