How Northpower totally reformed the operation of their 800-plus vehicle fleet into a modern, strategically driven form.

Northpower’s multipurpose fleet

How Northpower totally reformed the operation of their 800-plus vehicle fleet into a modern, strategically driven form.

Northpower’s Janet Mays is a woman on a mission. Her brief when she joined Whangarei-based Northpower as its national fleet and facilities manager in 2014 was to totally reform the fleet operation of 800 plus vehicles into the modern, strategically driven operation that it is today.

It has been quite a journey and in the process Janet, who worked in the fleet management industry for 25 years, has turned the management model somewhat on its head.  

Northpower has expanded from a Northland owned and operated electricity distribution network to a large multi-utility contractor and when she took up her new role it had an aged and disparate fleet.

It took her some months to develop the new five-year fleet strategy and three years on they have replaced nearly half of the vehicle fleet and by March 31, 2018 there will be a total of 565 new vehicles on the road or 68 percent of the current Northpower fleet. 

The vehicle fleet does not include the couple of hundred pieces of equipment such as trailers, all-terrain vehicles and diggers that the company’s 1100 employees use in their contracting work around New Zealand.

The fleet consists of passenger and light commercial vans, utes and trucks. Its new passenger vehicles are predominately Hyundai (Santa Fe, Tucson, i40, i30 and i20) although at the project management employee level Janet chose Mitsubishi Outlanders.  She chose Isuzu D-Max for the utes and Northpower’s vans are predominantly Hyundai iLoads. The truck fleet is now mainly Isuzu.

The company was established in 1920 and started life as a network operator in Whangarei but is now owned by a consumer-owned trust. Today the largest part of the business is contracting and Janet describes its work as the “arms and legs” of other companies around the country which own the lines. 

Across the North Island, it undertakes work for a range of large electricity and distribution businesses. Vehicles are co-branded to reflect those partnership arrangements.

Management of the fleet is undertaken through a unique “umbrella” methodology, she says, as they don’t have a fully maintained operating lease, but instead LeasePlan New Zealand provides the fleet management services to Northpower and manages the services’ providers for the company.

And when looking at ownership of the vehicles, because they were replacing so many of them, they opted for leasing finance. Quite coincidentally LeasePlan won the contract for the passenger and light vehicles while the TR Group is providing leasing finance for the truck fleet.

Essentially Janet has deconstructed the elements of the fleet. “We want to make sure we are not paying premiums for services we don’t need.”

She believes this is a very different model for fleet management in New Zealand, but says it’s the most cost-efficient model and the most effective model for the company.

Janet spent 25 years in the fleet management business mainly in Australia and now, as a customer, she says Northpower suppliers know they are dealing with someone who has been on their side of the negotiating table for a long time.

Essentially, she says Northpower has cherry-picked the elements they want. “We are the customers who know our business and we know what we need.”

She says it keeps a healthy tension in the relationships and coming from the supplier side has been a big advantage.

An early element in the fleet reform was to close the vehicle maintenance workshops that Northpower ran. This was not core business for Northpower and she takes the view that modern vehicles are “computers on wheels” and the company now uses the manufacturers’ servicing agents.

“I have the philosophy that the manufacturers of the vehicles are best placed to service that vehicle.” While it preserves the warranty it also ensures the vehicles are serviced according to the manufacturers’ specifications.

As to the vehicle selection, she says this was determined by a methodical whole-of-life costing model looking at the intended uses of the vehicles, warranties, greenhouse gas emissions and the ANCAP safety rating.

“Then we assess the cost to us to run the vehicles. When making a decision around our fleet make/model composition, we absolutely consider cost, but vehicle safety and ensuring the vehicles are fit for their intended purpose are equally critical.”

The replacement cycles will see passenger vehicles replaced after about 45 months, vans and utes will be kept for a maximum of six years as they have a very comprehensive fit-out although some of the high working vehicles will be replaced after five years.  

The truck fleet will be replaced after 10 years and elevated platform vehicles are replaced at nine years, because Northpower is in the electricity industry they have insulated booms, so the workers are protected. 

It’s been a huge job and the transformation of the business has been extraordinary, she says. Accompanying this has been the need to ensure the company’s employees understand the conditions of use of the vehicles and how they must be maintained. The standardisation across the fleet also ensures the fleet is flexible and vehicles can be moved around if need be.

Health and safety plays a big part in the fleet management strategy. Janet says moving vehicles have been identified as one of the top critical business risks and they have instituted a plethora of mitigating strategies including the roll out of GPS in the fleet. By the end of July this will be in every vehicle, including that of the management team.

Like standard GPS it shows where the vehicle is at any given time but vehicles also have a Navman screen which is an ‘in-cabin driving coach’ monitoring the driver and giving warnings if they are harsh breaking, harsh cornering or harsh accelerating. 

This coaching is for the driver only and the warnings just for them. But if the driver has a violation – such as a very harsh braking incident, the report goes back to head office.

The GPS and monitoring are about driver safety and while she admits there have been a few rolled eyes she says that personally her own driving behaviour has changed. “I have slowed down and moderated my driving behaviour.

“Our business wants to drive down the number of vehicle accidents we have and we have a moral and ethical obligation to keep our drivers safe and ensure they are driving as safely as possible.”    

Queried further about employee reaction, she says there has been some push-back but if a driver is consistently having problems a driver proficiency assessment is undertaken by a third party. 

As for electric vehicles, she says as a lines company which owns the local network, Northpower, has always had some EVs as part of its fleet. Traditionally it has had Japanese imports, some of which it is now selling and “we are literally in the market for EVs”.

Strategically Janet is looking at how they can integrate them into the fleet but there are limitations with EV at the moment as there are no vans or utes currently available that are suitable for the company. It is in the passenger/pool vehicle fleet where she can see the opportunity. Northpower is also looking at what role it can play in the charging infrastructure network for EVs.

On the sustainability front Northpower has moved the bulk of its vehicles to diesel and only uses petrol when the vehicle has low mileage.