The current coronavirus/COVID-19 pandemic has touched just about every aspect of truck fleet management, from purchase to maintenance to disposal, and everything else in between.
Fleet managers are specifically concerned about the impact now (and in the future) on their vehicle upfits.
We spoke with Auto Truck Group to find out more about what they see happening now and in the future.
Impact on Upfitter Operations
Like most businesses, Auto Truck Group continues to adapt to a rapidly evolving business cycle as COVID-19 alters the landscape of the fleet industry.
“Fortunately, order volume was extremely high when the pandemic began. This meant many of our locations throughout North America could continue their focus on producing these units based on the availability of materials,” said John Hart, vice president, operations for Auto Truck Group.
Auto Truck Group remains in close contact with its key suppliers, and, except for OEM facility shutdowns, there are minimal disruptions at this time.
“Access to vehicles and chassis from the OEMs is critical for the upfit sector, so resuming production will be vital to the entire supply chain in the coming months,” Hart added.
The long-term impact of COVID-19 is being monitored very closely by the entire Holman organization.
“Fortunately, our leadership across the automotive industry allows us to pivot quickly and address supply chain challenges for our customers during this period of uncertainty. This continuity - particularly with ARI - enables us to deliver a seamless fleet customer experience starting with ordering and upfitting through replacement and remarketing, while managing vehicle lifecycle costs along the way,” Hart said.
Business demands on Auto Truck Group’s customers will likely shift as the pandemic recovery process continues.
“If fleets have to delay orders or get vehicles on the road sooner than anticipated, our collaboration with ARI and other Holman businesses allows us to deliver a holistic solution that best positions our clients for the road ahead,” he said.
Collaboration Keeps Things Moving
Specific to the upfit sector, there are undoubtedly several challenges presented by pandemic conditions.
“However, the ability to remain agile can present some opportunities as well. When it comes to acquiring vehicles, upfitting is often viewed as one of the last steps in the supply chain from a customers’ point of view - and that’s certainly the perspective that matters most,” Hart said.
Hart added that it’s important to remember there’s an intricate synchronization taking place behind-the-scenes to ensure timely delivery of all components required to build vehicles.
“Depending on the specification’s complexity, an upfitter may need to source materials from potentially dozens of suppliers. If even one single critical supplier in the chain is delayed or unable to deliver, the entire production schedule is affected. This usually results in the vehicle hitting the road later than expected,” Hart said.
The ability to leverage the diversity of the Holman organization, including ARI’s supply chain expertise and Kargo Master’s manufacturing capabilities, helps Auto Truck Group mitigate a number of these factors, even in times of uncertainty.
“Auto Truck Group, ARI, and our customers work collaboratively to minimize supply chain delays and develop alternate plans for navigating any pandemic challenges that do arise,” Hart explained.
Finally, Auto Truck Group can leverage Holman’s core competencies to support its customers with creative solutions.
“For example, imagine that one customer is experiencing a downturn in their business due to the current economic uncertainty and wants to delay vehicle orders. Another customer needs additional units quickly due to increased demand. We can potentially align these fleets in a win-win scenario for all involved,” Hart said.
Focus on the Long-Term
The best advice Hart said he could offer fleet managers is to remain focused on the long-term view.
“Having a well-developed, strategic replacement schedule and adhering to it as closely as possible (given the current circumstances) is the best way to minimize disruptions and ensure business continuity,” Hart said.
For the most part, Auto Truck Group is seeing a significant number of its customers following this approach.
“There are certainly some industries facing greater fluctuations in their business cycle and, therefore, are faced with some difficult decisions. In those scenarios, we’re working closely with our impacted customers to help them balance the need to financially weather the current storm without creating long-term cost challenges. We ultimately want to position all of our clients for a brighter future,” Hart said.
Auto Truck Group Today
While this crisis is not yet over, the way organizations continue to adapt gives Hart the confidence that we’ll be able to work through these challenges together.
“The most important thing to remember, and I truly cannot emphasize this enough, is that we are all navigating these challenging times together. As COVID-19 impacts our industry daily, transparent communication is more important than ever,” he said.
Auto Truck Group is available to support its customers and remains in constant contact through both its account management team and ARI’s supply chain coordinators.
“We understand the business needs of our customers are evolving rapidly in the face of COVID-19, and we’re committed to remaining as flexible as possible. We’ve shifted orders to later in the year as needed and delayed some deliveries to accommodate our customers during this challenging time,” Hart said.
Many of us today are working differently than we have in the past, using technology to innovate and find creative ways to keep business moving.
“While it’s an adjustment for all of us, we will also uncover valuable solutions that will endure long after we overcome the current situation,” Hart said.
Auto Truck Group’s sales team recently completed a vehicle pilot review remotely.
“Additionally, our engineering team has reviewed a number of body designs remotely with our customers, using advanced technology to get immediate feedback to help keep production on schedule,” Hart shared.
The company is also leveraging technology to frequently engage with personnel at each Auto Truck facility to ensure they receive relevant updates in real time.
“I think most businesses are finding themselves in similar scenarios, and building playbooks from lessons learned along the way. Auto Truck Group is already adopting much of what we’ve learned during these unprecedented times, and we’ll emerge as an even stronger organization moving forward,” Hart concluded.