You have an aging fl eet of vehicles. You need to be able to convince your chief, who still thinks Dodge produces the Diplomat, or your city council, most of whom have never set foot in a police car, or your county board, which is more concerned with jail budgets, to buy new vehicles. However, you don’t know how to go about producing the evidence you need. If it were a crime scene, you would know evidence when you saw it, but this duty of fleet management is only a part of your job. As you read this article, you will learn how to process the procurement of a vehicle in the same way you process a crime scene. From the initial call through the court room, you will be able to successfully argue your case and get the verdict you need. You will be able to explain the concept of cost of ownership in words even a bureaucrat can understand.
Approach the purchase of vehicles in the same manner as if you were arriving on the crime scene as an investigator. Certainly there is the instinct to run to the epicenter, but we all know to start processing as we move toward the scene. e same applies to our approach to the next vehicle purchase. e diff erence is the epicenter may be the vehicle we have always driven.
Just as in our investigations, we need to proceed with an open mind and see where the evidence leads. The vehicle scene today, with all the new choices, can be as daunting as a homicide investigation. Just as methodology can work you through crime scenes, it can get you through vehicle procurement.
You survey the scene and notice the usual suspects of Chevrolet, Dodge and Ford, but something is diff erent. There are new members of these families, which at first may seem to add to the confusion. The fact remains, however, that we are not here to find a suspect, but work the facts. We take note of these vehicles and move forward into the scene. Our mission is to find out who has the means, motive and opportunity to complete the crime or, in this instance, the mission of cost-effective patrol.
Next, we gather the obvious information available to us. In this case, it is the cost of the vehicles. As with most things in law enforcement, forms can be annoying but can also make our lives easier. We will build a form for the cost of ownership scene as this story unfolds. We have already gathered two vital pieces of information for our form: the vehicle make and models and the initial cost (Table 1).
Importantly, note the phrase “initial cost,” because that is often the only number the members of our juries pay attention to when it comes to purchasing. We need to erase that phrase from the record as we build our case. In the life of a vehicle, it is the criminal investigation equivalent of a birth date—everyone has one, nothing more.
Gathering More Evidence Many managers would simply present “Table 1” to the jury. With little deliberation, the choice would be clear—buy the cheapest one. But is the least cost the “just” choice? It might be, but it doesn’t mean we shouldn’t keep processing the scene. Cost is just one of the biases we are going to be faced with during this investigation.
Yes, even in fleet management, discrimination and bias are factors. You have to combat the “we have always driven this, so we will always drive this” mentality and the “a police car is supposed to be just that, a car” mentality with facts and gentle reminders that these statements are based on opinions. That is something we know does not go far in the courtroom.
While at the scene, don’t forget to speak with witnesses. It is important to factor in the witnesses’ backgrounds. The facts can be quite diff erent coming from the witness who wants to help too much (dealer) versus the witness who may have skewed views (“My grandpa drove a GM, my dad drives a GM, and I will drive a GM.”).
We cannot ignore these statements, and they become a part of what we are putting together. However, sometimes you have to look for witnesses, as they are not always standing at the police tape. In our case, fleet managers like yourself who may have had different experiences with the vehicles you are looking at are key witnesses.
Just as with a crime scene, we keep digging, looking for clues to the not-so obvious as we continue to build our report. We have cleared the scene now, and we are looking into the alibis of the suspects we have identified. This background check involves looking at internal files and maintenance reports or, if you don’t have these characters in your master name index, using the all-important information sharing.
You may have had experience with the Ford Crown Victoria but little to no contact with the Charger, Impala or Tahoe. Asking agencies that have used these vehicles for their opinions may lead you further down the road of bias, so it is important to ask for maintenance records as well. ese numbers, as well as those that follow, are based on three years or about 60K miles, and they fill the third column of our cost of ownership form (Table 2).
Now that we have shed some light on maintenance costs, there may be a shift in our investigation’s focus. Our lead suspect in this case doesn’t look so clear-cut anymore. The investigation is not yet complete because there are more elements we need to look at to make our case. We cannot depend on others to win our argument. Many of you may have experienced the prosecutor who makes a deal just to chalk up a cheap win and stay out of court. The same applies to vehicle procurement; we have to make a solid case so there is little choice but to follow it all the way.
Today, there is a heavy focus on fuel economy. This factor goes toward ability, though in a lesser way than maintenance. It is important when looking at this evidence that you consider your jurisdiction’s driving style. A county or state agency is going to have a diff erent style of driving than a city agency. Fuel economy is typically mitigated across vehicle type when you have very low average speeds. The fourth column fi nds its way into our form under the heading “fuel economy” (Table 3). We don’t see much of a shift in focus after we add fuel for our sample jurisdiction, in this case a university police department. The numbers used to generate the table were based on a fuel cost of $3.20 for a gallon of fuel and on the fuel economy of each vehicle for a 20,000-mile-per-year cycle.
End-of-Life Value Given that our suspects are typically upfi tted with the same equipment, there is little diff erence in cost here. So we need to move forward into our matrix and start what will amount to very simple math under the guise of an intimidating title of “total cost of ownership.” We need to measure the amount of time these vehicles are going to be, or were, in service. This number is important, as it will greatly affect the direction of our investigation. Some agencies have a set period of time their vehicles are in fleet.
For the first time in our investigation, we now have to move from the definite to the potentially obscure. This is the “not so scientific” practice of determining end-oflife value. Again, unless you have had recent experience with the used police vehicle market, your investigation will rely heavily on shared information.
Unlike data-sharing of today’s crimefi ghting world where the source isn’t so important, when looking for vehicle information, it is important that those from whom you glean data have similar attributes to your agency. It would make little sense to use the end-of-life value of a four-wheel drive in Florida when you live in Michigan.
No easy answer exists. The Kelly Blue Book, oriented to retail vehicles, is not where you want to be looking. Perhaps a good source would be recent police auctions. Once you have drawn a comfortable conclusion to the end-of-life value, place the values in the fifth column of our ever-growing chart. These residual values are based on 60K miles, knowing that plenty of life is left in the truck-platform SUV (Table 4).
We now have the necessary information to determine the total cost of ownership (Table 5). There may be an underlying fact buried in the total we have gotten: years of service. This can fluctuate and is not typically a concrete number. It is important to note this figure is actually buried in the maintenance and fuel costs in that these numbers will increase the longer a vehicle is kept in service. Later, we can add a “years of service” column to determine annual total cost of ownership. For now, we’ll see where using the raw data leads.
As you can see from our chart, we are starting to see what our total cost of ownership of a vehicle is per mile of service—total cost divided by annual miles operated. Alternatively, we can easily divide the total cost by the years of service. Initial cost to purchase, cost of equipment and upfi tting, maintenance cost, and fuel cost all total to be our cost of ownership. The field can now be dissected by determining cost per year to operate, or cost per mile to operate. Either of these figures can bring “real time” numbers to the administrator’s desk.
Financially sound departments may be so lucky as to rotate their fleets every couple of years, regardless of mileage and vehicle type. Still others rotate on lifecycle analysis, where, based on math, a decision is made on the length of service of a particular vehicle. Most agencies can agree that the Tahoe typically has the ability to live out a longer service life.
However, with General Motors’ five-year, 100,000-mile drivetrain warranty, there is added comfort to some to push the service of their GM products given the most expensive pieces are now factory covered. The other suspects off er extended warranties as well, but like an involuntary confession, you shouldn’t have to pay for the truth. This number in our chart may have the greatest variance and is typically dependent on sharing information with other agencies
Presenting the Facts
We have processed the vehicle scene, interviewed key players and gathered the evidence. e report has been written and it is time to take this case to the next level, the chief’s desk. Depending on the department, the chief plays a role similar to that of a prosecutor.
It is important to remember that just as a prosecutor is so far removed from police work that his or her concept of justice is based on perfect facts laid out in briefs, so may a chief be so far removed from the road that he may not understand what is necessary for officers to get their jobs done safely and in a fi scally responsible manner.
It is your job, as the fleet manager, to paint the picture for your administrator such that their only choice is to stand behind you when this issue goes to trial. Without the backing of this key individual, your case may never see the light of day.
In this time where budgets are tight, a unique opportunity presents itself for us to be able to sell the idea of total cost of ownership to our management. One way to do this is to present your case by explaining how you derived this perceived-to-be-complicated term to your chief or sheriff in the simplest of terms.
For the purpose of showing you how to fi nd total cost of ownership, there were several charts and a lot of numbers. Along with those charts we off ered explanations as to how those numbers were calculated. Today’s law enforcement administrator does not have time to do the digging you were appointed to do, so it is important not to lose the opportunity to explain the total cost of ownership signifi cance as a concept, not as a “how to.”
As you speak with your administrator, lead with your recommendation, and support it with a quick recap of how you came to this conclusion. In some cases, your chief or sheriff may just sign off on your suggestion, and dependent on the fiscal process of your organization, this may be the last step before going to bid. Of course, you may have to dive further into the process, explaining it more in depth.
Remember, the total cost of ownership numbers you produce may potentially back your boss into a corner, and like anything which finds itself trapped, a defensive posture is struck and your battle becomes more diffi cult. For that reason, it is important to understand the total cost of ownership process and be able to explain it using the simplest, easiest to understand terms.
It is important to note that the numbers shown here are estimates for math purposes only. The numbers used in the tables are for the purpose of explaining the concept only and must not be considered actual costs or the basis for decision-making. Simply add your own validated numbers!
Scott Coy is a lieutenant with the Western Michigan University Police Department. He has been in charge of the management of his department’s fleet since 2003. Coy is also responsible for all technology deployed at the department. He may be reached at scott.d.coy@gmail.com.