The key to efficient loaner management lies in being proactive. Establishing strong processes, clear policies, and a dedicated team is crucial for success. By taking a proactive approach, you can focus on providing excellent customer service while minimizing the time spent managing the loaner fleet. Here’s how you can effectively manage your loaner fleet and ensure that it runs smoothly and profitably.

Track Key Performance Indicators (KPIs)

To get the most out of your loaner fleet, it’s essential to keep track of critical Key Performance Indicators (KPIs) such as Length of Loan, Utilization, and Cost Recovery. By closely monitoring these KPIs, you can identify areas that need improvement and make data-driven decisions to optimize loaner operations.

• Length of Loan: A high Length of Loan KPI indicates that customers may not be returning loaner vehicles promptly once their service is completed. This can result in fewer vehicles available for other customers and a loss of efficiency. To reduce the Length of Loan, consider implementing strategies like notifying customers earlier in the day that their vehicles are ready for pickup. This gives them ample time to plan their afternoon around picking up their car and returning the loaner, minimizing delays.

• Utilization Rate: A low utilization rate can signal that loaner vehicles are sitting idle instead of being used for new service customers. Vehicles that are not being turned around quickly after use may create bottlenecks in your service process. To combat this, establish a quick vehicle prep and turnaround process. Ensure your team is prepared to clean, fuel, and check in vehicles immediately after they are returned, allowing them to be quickly reassigned to the next customer.

• Cost Recovery: Low cost recovery can indicate that the dealership is not accurately capturing expenses like fuel or tolls. Misreporting fuel levels before and after loans can lead to unnecessary losses. Make sure your team is carefully recording starting and ending fuel levels at the contract’s open and close, ensuring accurate cost recovery for every loaner transaction. Setting clear guidelines and training your team on proper procedures can also help reduce inaccuracies.

Track Vehicle Age and Mileage

Another key component of effective loaner management is tracking the age and mileage of each vehicle in your fleet. This is especially important when planning to dispose of a vehicle or transition it out of service. To avoid complications, plan to remove a vehicle from service several days in advance of its disposal date.

Loaning out a car too close to its planned disposal can lead to issues like non-compliance with manufacturer programs or exceeding mileage caps, which could result in penalties. By proactively managing your fleet’s age and mileage, you can ensure that your loaner vehicles remain within sales program eligibility and avoid unnecessary costs.

Actively Manage Your Loaner Fleet

Being proactive also means taking responsibility for the ongoing maintenance and care of your loaner vehicles. This ensures that every vehicle in your fleet is well-maintained and that customers don’t encounter issues when using a loaner car.

• Routine Maintenance: Establish a regular schedule for maintenance and repairs, ensuring that your vehicles remain in good condition. Regularly check for service bulletins or recalls that apply to your fleet and address them promptly. This reduces the possibility of a customer experiencing vehicle troubles and helps prevent unexpected downtime.

• Monitor Cost Recovery Performance: Consider tracking your fuel and toll expenses over a few weeks to understand which costs are customer-incurred and which are part of regular business operations, like shuttle services. This analysis can help you identify which costs to charge back to customers and which to absorb as part of your operational expenses. By understanding the full scope of these costs, you can make better decisions regarding cost recovery policies.

Leverage Data for Better Decision-Making

One of the most important aspects of proactive loaner management is using data to guide decisions. By consistently tracking KPIs, vehicle mileage, and cost recovery, you can build a comprehensive understanding of how your loaner fleet operates. This allows you to make informed adjustments to your policies and processes to improve efficiency, reduce costs, and enhance customer satisfaction.

Using data-driven insights also allows you to anticipate future needs, such as when to replace vehicles or adjust your loaner fleet size. By keeping an eye on these trends, you can ensure that your fleet remains well-balanced and profitable.

Conclusion

Managing a loaner fleet effectively requires a proactive approach that incorporates strong processes, regular tracking of key metrics, and a focus on customer satisfaction. By setting up clear policies, monitoring KPIs, managing vehicle age and maintenance, and recovering costs accurately, you can create a streamlined loaner management system that benefits both your dealership and your customers.

When you proactively manage your loaner fleet, you not only increase operational efficiency but also boost your bottom line by minimizing unnecessary costs and maximizing vehicle utilization. In doing so, you’ll be able to spend more time focusing on what truly matters—delivering excellent service to your customers.  Find out how Connexion Mobility can help your Dealership maximize efficiency.