The time-frame for replacement of vehicles varies between organisations, depending on vehicle type, whether the vehicle is leased or owned and resources available. For example, all government vehicles must be disposed of at 60,000 kilometres or after three years from the date of initial delivery. Other organisations may have a similar replacement time-frame for cars and station wagons but decide on a longer time-frame for specialised vehicles like buses. Modified vehicles also may not be replaced as quickly as cars.
For efficient fleet management, organisations should develop replacement plans and schedules which take into account organisational needs and vehicle usage, safety, whole-of-life costs, estimated resale values, environmental impact and available resources. Schedules should be adhered to and preparations should begin 3 months prior to the planned replacement date by contacting dealers or wholesalers and providing advice and notification to managers who have responsibility for the vehicle.
Be wary of replacing vehicles too quickly as this can create extra administrative overheads and it can be difficult to recover the value of the vehicle at sale. According to the Australian Consumers' Association, cars depreciate on average by around 14% a year for the first three years and about 6–8% after that.
Market conditions fluctuate continuously and planning replacement should include monitoring these variations in the market, for example, become familiar with the times of the year manufacturers adjust prices and purchase before the next price rise. It is advisable to build some flexibility into your replacement schedule so you can choose the best time to sell or acquire a vehicle.
Replacing more than one vehicle at a time can save time and money. Three months prior to the replacement date, dealers or wholesalers should be contacted with the details of the vehicle to be replaced and the replacement vehicle required. A valuation of the vehicle can then be arranged. Ensure that the final odometer reading is recorded before handing the vehicle over.
Supported by the Community Sector Investment Fund (external link - opens in a new window).