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Operations

How Autozone Moves Parts Around the Globe

November 2017, Work Truck - Feature

by Roselynne Reyes - Also by this author

AutoZone locations are arranged in a hub-and-spoke formation. Larger “hub” stores are stocked with a variety of products, and are surrounded by smaller satellite stores. (Photo: Getty Images)
AutoZone locations are arranged in a hub-and-spoke formation. Larger “hub” stores are stocked with a variety of products, and are surrounded by smaller satellite stores. (Photo: Getty Images)

As the leading retailer and distributor of automotive replacement parts in the United States, AutoZone’s fleet has a lot to accomplish. The company maintains a fleet of about 16,000 light-duty vehicles used to deliver supplies across the U.S., Mexico, Europe, and Brazil and has to ensure that all are running smoothly.

Clay Gaudet, fleet manager, shared how he manages such a large fleet, from purchasing to fuel.

Delivering to the Network

Most of the company’s vehicle fleet is comprised of cars and light-duty trucks used to deliver parts from stores directly to customers. The company also utilizes vans for deliveries between stores.

All vehicles run on gasoline. The fleet has tested alternative fuels, including compressed natural gas (CNG) and propane autogas. But with low gasoline prices, the fleet has not been able to justify a switch. However, it has considered a return to diesel in a few locations, including Puerto Rico.

AutoZone locations are arranged in a hub-and-spoke formation. Larger “hub” stores are stocked with a variety of products, and are surrounded by smaller satellite stores.

Parts are delivered from distribution centers to stores on a weekly basis, and fleet vans are used to transport products to satellite stores, which carry fewer products and require deliveries multiple times a day to keep shelves stocked.

Working Smaller — and Smarter

Although maintenance is handled by a fleet management company, Gaudet works directly with OEMs for procurement.

Years ago, AutoZone’s fleet was uniform — pickup trucks with AutoZone branding. But it found that it could accomplish the same tasks with smaller vehicles.

“Most of the time people weren’t actually utilizing the truck bed to carry what they’re bringing to our customers. They’d put it on the seat next to them,” Gaudet explained. “Cars and trucks are making the deliveries, the only difference is trucks can deliver things like engines, exhaust systems, rack and pinions, transmissions.”
In addition to shrinking the fleet’s carbon footprint, the smaller vehicles also come with a smaller price tag, reducing acquisition costs.

Until 2008, all fleet vehicles were branded with the AutoZone logo. Since branding was removed, the company has saved millions of dollars in accident claims. (Photo: AutoZone)
Until 2008, all fleet vehicles were branded with the AutoZone logo. Since branding was removed, the company has saved millions of dollars in accident claims. (Photo: AutoZone)

In 2011, the company also rolled out telematics, which has improved driver behavior.

“It reduces the amount of accidents that we have from people doing jackrabbit starts and jackrabbit stops — those are the precursors to someone that’s actually going to be involved in an accident,” Gaudet said.

An unexpected benefit was the reduced fuel cost, as drivers were now held accountable for idling.

Despite these achievements, you may not notice as many AutoZone vehicles on the road these days. That’s because the company decided to remove branding from its fleet in 2008.

Vehicle wraps still appear on the company’s tractor-trailer units in AutoZone’s supply chain and the company’s maintenance vehicles. But the rest of its fleet is unbranded, which Gaudet said has reduced accident claims by millions of dollars.

Global Challenges

Working with a global fleet means dealing with different standards. In Germany, for example, the fleet cannot deploy telematics. In Brazil, the company must pay for the driver’s lunch. In some countries, you make one stop to obtain vehicle registration from a federal or state-level agency; in others you have to meet region-specific regulations, which may require multiple steps.

“It’s knowing the idiosyncrasies of each area where your vehicles are located and what you have to do for the employees,” Gaudet said.

This challenge also arises when managing fuel use. Not all countries allow access to the same data. In some cases, the fleet must rely on employees to send receipts for every fuel purchase, which is liable to human error.

Moving Forward

With technology advancing, the future of fleet is not always clear.

But Gaudet is ready for whatever comes next. As a former operations manager with UPS, he’s learned about logistics, and knows to be prepared for what comes next. Gaudet has already planned how the fleet will employ autonomous vehicles once they arrive. 

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