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What is an Auto Fleet?

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  • Written By: Jeremy Laukkonen
  • Edited By: Jenn Walker
  • Last Modified Date: 12 November 2016
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An auto fleet is a group of vehicles that is owned and operated by either a public or private entity. These fleets can consist of cars, light trucks and heavier duty vehicles. Governments will often have vehicles in their fleets for employees to drive as well as to perform various governmental tasks. An auto fleet operated by a business will typically reflect the industry in which the business is engaged. Delivery companies, for example, will tend to have large numbers of parcel vans and trucks in their fleets, while other businesses might have a variety of cars, trucks and other specialty vehicles.

Many government organizations and municipalities operate auto fleets. In the US, the vehicles owned by the federal government are often referred to as the federal fleet. At the local level, police departments, utilities and other public entities will often operate their own fleets.

Private businesses may possess large fleets as well. Delivery companies, car rental agencies and taxi companies are some examples of businesses that might maintain auto fleets. Businesses that employ outside salesmen will often operate fleets as well, providing vehicles for their salesmen to call on customers.

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Rather than purchasing vehicles for their fleets, many government agencies and businesses choose auto fleet leasing. Many fleet vehicles are used extensively and accrue mileage at a faster rate than private vehicles, so an auto fleet lease may provide a cost-effective way for an organization to keep its vehicles fresh. If the vehicles are bought outright, it is common for fleet vehicles to be auctioned off in large lots once the organization determines they are too old or have too many miles.

Some organizations with large auto fleets may retain their own service personnel. In other cases, auto fleet maintenance can provide a lucrative revenue source for third party mechanics since large fleets may require regular maintenance and repair operations. Some organizations that have mechanics on staff may look to have certain fleet maintenance operations done by outside parties if a repair is particularly complex or their repair staffs are at capacity.

Large auto fleets sometimes also have the option to self-insure, rather than using a third party automotive insurance company. The laws governing this practice vary between jurisdictions but are often dependent on how many vehicles are in the fleet. If an organization chooses not to self-insure or is not allowed to, the large number of vehicles in its auto fleet may make the organization an attractive client to insurance agents.

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KaBoom
Post 4

@indemnifyme - I'm with you. I think self-insuring is a dumb idea in most cases. A friend of mine actually used to work for a company that had an auto fleet for the salespeople to use.

One of the employees got into a pretty serious accident with the car, and the company was sued for a pretty sizable amount of money. Luckily their insurance paid for the whole thing. If they hadn't have had insurance, they would have been a lot worse off.

indemnifyme
Post 3

I would not recommend self insuring for an auto fleet. You should definitely get the commercial auto insurance to be on the safe side. Even if your company is highly successful with high profit margins, insurance is still more economical than having to pay out of pocket if something happens.

For example, if a car in your fleet gets into an accident, the company will be sued, not the individual driver. If you have insurance the liability portion will pay for it. If not, it will come out of the companies funds.

I know some people balk at paying for insurance, but I assure you, in the long run it is well worth it.

JimmyT
Post 2

@stl156 - I agree. I have noticed that there are small companies out there that advertise about the auto fleet and that makes them sound like a more established company to the possible customers. Although, this may be a tactic they use they are trying to compete with other, much larger companies that have more money and resources, thus have a larger fleet. All it really comes down to is the service and the maintenance of their fleet. I would like to think that a smaller company would have less vehicles, thus they may have an easier time maintaining their cars. If someone were looking to rent from a car fleet service they need to shop around and read up reviews from past customers about the company to be sure that it will be satisfactory.

stl156
Post 1

Companies that have a real auto fleet tend to have a decent amount of money and success. However, some smaller companies will try to show everyone that they have an auto fleet but it may only consist of a few cars and they will not be maintained well. They will pass off the concept of having an auto fleet because it reflects well and looks good for their company. If anyone is looking for something such as van rental it is important to find a well known company to make sure of reliability and to make sure they have a large auto fleet.

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