OptiFleet, a vehicle fleet lifecycle management consultancy, has just launched a new tool to revolutionise the way people buy, manage, sell and think about cars.
The Total Cost of Ownership tool (TCO) has been driven by Jack Gordon-Crosby, Managing Director of OptiFleet, the man dedicated to providing a transparent and publicly accessible platform for the buying and selling of motor vehicles.
“It’s a tool designed to capture all the relevant costs pertaining to vehicles throughout their lifetime, which is the total amount of distance travelled and time the buyer owns the vehicle,” he says.
“It’s looking at the initial capital and long-term operational costs associated through life, so people aren’t only thinking about the cheaper car or the biggest discount. They usually think, ‘how much do I write the cheque for?’, with little or no consideration to what the costs might be once delivery has taken place.
“The tool encourages people to look at the most cost effective vehicles through life including what might be the most sustainable option, which is usually more efficient and pans out better through the vehicle’s life with the client.”
The TCO looks at sustainability from a number of angles, both personal (such as fuel efficiency) and environmental (such as comparing electric cars to non-electric). It compares vehicles side by side, taking into consideration the cost to buy and the cost to run, less an estimated future residual value. The cost elements include (but are not limited to): fuel type, cost of electricity, Fringe Benefit Tax days and rates, purchase price, service, compliance and tax. Key vehicle features such as ANCAP (Australasian New Car Assessment Programme) safety rating, fuel economy and vehicle features are considered when matching fit-for-purpose requirements.
Here’s how TCO works: OptiFleet has developed a database of every model and brand of vehicle for sale in the country. The portal allows for TCO comparisons to be made on any vehicle and the calculations rank them, based on the total cost for the prescribed term and distance of use, including regulatory compliance and all associated running costs.
Jack says potential buyers are constantly weighing up the total cost of owning a vehicle and sustainable vehicles tend to work their way to the top.
“The TCO makes sure that people aren’t taken down a rabbit hole with the cheapest car or the biggest discount,” says Jack.
“Safer vehicles are generally more sustainable because manufacturers are investing in safety and, along with it, sustainability.”
Before becoming publicly available Jack tried and tested the TCO to supply the essential vehicles for the government fleet.
“All of these questions were coming in,” Jack says, “about the make, model, retail, discounts, engine size, power, torque, towing capacity, length, width, height, cargo capacity, fuel efficiency, CO2, service costs, service intervals, warranty, reliability, fuel tank size, travel range and the list went on and on.”
He’d been keeping a record of every vehicle’s features, like fuel efficiency, so when the Ministry of Environment shifted its focus to more sustainable vehicles, he began comparing vehicles in the fleet with their counterparts and the approach using TCO had its start.
A retail version of the Total Cost of Ownership tool is soon to be publicly available on the Energy Efficiency Conservation Authority (EECA) website and is in full operation through the Optifleet BestCar portal on consultation.
OptiFleet’s TCO aligns with the Sustainable Business Network’s projects on smart transport. You can find out more about our smart transport projects here.