GE Industry Experts Answer your Fleet Management Questions

Ask the Expert question: Can you help me reduce my trailer maintenance expense? We are looking at outsourcing as an option, but I'm concerned I may be missing some of the costs of both options.

GE Senior Marketing Leader, Jeff Ballew, answers: Yes, I can recommend several ways for you to save some money. First, you have to think about where you do maintenance and what the cost of downtime is at these locations. Many customers have a need to do maintenance at their terminals, but that may not be the location of their most critical downtime. Once you know where your critical downtime is, then you need to determine who will do the best work for the lowest cost.

There is always a trade-off between running your own repair facilities and outsourcing. Doing work in-house can be very expensive if you do not utilize your resources well. On the other hand, you can watch your maintenance costs climb if you have too many suppliers and do not keep close tabs on them.

Utilization is a key profitability driver for your in-house maintenance facilities. Are you using your shop and mechanics enough to justify having a staff, equipment and a building? Are your units going down off-site, creating a need for mobile service vans and a shop? In addition to utilization and location, you want to consider what skills your employees have versus how you are using them. If you are using diesel mechanics to repair trailers, you are spending more money than you need to. Several of our customers who have in-house shops use us for their overflow and FHWA compliance.

So, why not outsource? Many companies do outsource their maintenance, but there are hidden costs here as well. One of our major for-hire customers said they kept seeing their vendor costs creep up which caused them to move to us. Others have told us that they get a low labor rate on a quote, but the hours and parts charges are increased which keep the costs high. Add to that the cost of managing multiple vendor relationships across the country and you may feel like you have not saved any time and money by outsourcing. What you stand to gain, however, is that an outsourced vendor may be able to work on your units at your customer locations (or other non-terminal location) where you may experience the most critical downtime.

When looking for an outsourced solution, you want to find a company that values integrity and quality first and foremost. Look for published repair standards and parts prices. In addition, is there a way to search repair history online and share data with your own systems?

Whether keeping maintenance fully in-house, using a hybrid or going to a fully outsourced solution, you will want to monitor all of your costs, obvious and hidden.

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