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May 2009, Automotive Fleet - Feature

9 Mistakes to Avoid When Playing 'Musical Cars'

Many of those millions laid off during this recession’s corporate downsizings drove company cars. The process of reassigning vehicles retrieved from terminated employees can lead to errors. Here’s how to avoid them.

by Mike Antich - Also by this author

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Since the recession's start at the beginning of 2008, 4.4 million jobs have been lost due to corporate downsizings and layoffs, with more than half of the employment losses occurring in the November 2008-February 2009 time frame. February was the third straight month in which more than 650,000 employees lost their jobs, according to U.S. Department of Labor data.

Many of these terminated employees were assigned company vehicles. In today's politically correct HR environment, the term "reverse expansion" is used to describe the retrieval of company-provided vehicles from terminated employees. The reassignment of vehicles retrieved from terminated employees to other drivers is referred to by some fleet managers as playing "musical cars."

"We have been involved in a growing number of reverse expansions - especially in the pharmaceutical industry. These projects can include thousands of vehicles at one time," said Matthew Betz, VP national account sales, AmeriFleet Transportation.

A fleet manager suddenly thrust into a reverse expansion will find it is very easy to make mistakes. Here are nine common errors to avoid when conducting a reverse expansion.

1. Lack of Planning
When fleets go through a downsizing, the fleet office (often not their fault) does not give the logistics company or fleet management company enough advance notice for adequate planning. "As you can imagine, getting 1,000 vehicles picked up in various locations around the country, often on a tight time frame, is a daunting task. It takes planning, logistics skills, and resources. The chance for success is greater with more advance notice," said Betz.

Terry Langness, VP, national sales for PARS, offers similar advice. "Give the transportation company as much notice as possible when moving a vehicle. Most can react quickly to an emergency situation, but if there is an option to give them additional notice, everything goes much more smoothly."

Another problem is the failure to coordinate the pickup of the vehicle with other activities that need to take place. "For instance, many pharma fleets also have to manage the pickup of drug samples, which are often controlled substances. Without proper coordination, the outgoing driver can be inconvenienced by appointments with a field manager picking up a laptop, phone, fuel card, etc., the compliance company picking up drug samples, and the logistics company picking up the vehicle. Using the right logistics company can reduce all of that activity into one phone call and one 'touch' of the departing company car driver," added Betz.

One area of vigilance is retrieval of other company assets such as fax machines, laptop computers, photocopies, or company samples. This task is sometimes delegated to the fleet department, and the equipment is often loaded into the trunk of the vehicle being retrieved. Sometimes an unscrupulous employee does not return the company-provided laptop and instead returns a less expensive model in hopes the switch will go undetected.

In addition, fleet managers sometimes underestimate the exposure reverse expansions gets within their organization. "Often, officers as high as the CEO are getting updates on each phase of the downsizing effort. Appropriate planning and partnering with the right logistics company can be the difference between a successful project and looking bad in front of the entire organization," said Betz.

2. Inaccurate Information
It is important to provide the transportation company correct contact information for pickup and delivery locations, such as names, phone numbers, e-mail and mailing addresses, vehicle information, etc. "A significant amount of time and effort is involved when this information is not accurately given to the transportation company. It is helpful to include the manager's contact information as another way to communicate with the pickup location," said Langness.

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