Vehicle Acquisition Environment

Hi Demand; Low Inventory; Model Year Changeover

This purpose of this edition of the ARI/ABSS newsletter is to bring to everyone’s attention the current environment in which we are all working concerning the out of dealer inventory vehicle locates and purchases which make up the majority of AlliedBarton’s vehicle acquisitions. As touched on in a previous Newsletter there are a number of factors that are affecting the vehicle locate, acquisition and delivery process:

  • Japanese disasters impacting production and parts supply chain globally

The Japanese disasters have reduced production and availability of certain parts and paints that have had a negative affect on many different vehicle manufacturers and their production capacity

  • Greater emphasis on Just-In-Time inventory management in OEM production

All vehicle manufacturers have scaled back on production to just meet demand as opposed to prior years where the norm would be to overproduce and allow completed vehicles to sit in abundant dealer inventory

  • Increased fuel cost

The increase in fuel costs has created a demand for Hybrid vehicles and smaller more fuel efficient vehicle models. This increased demand has decreased the supply and availability of these models and the potential of increased pricing

  • Model Year changeover

Right now the manufacturers are finishing the production of the 2011 model year vehicles and beginning the ramp up and pre production of the 2012 model year vehicles. The manufacturers halt production for a period of time to allow for the production plants to changeover to the incoming model year specifications. As expected this creates a void between model years and decreases the availability of inventory during this period

All of these factors impact the lead time for vehicle requests and ultimate delivery to your location. This also can affect pricing as we have to expand our searches often to other states which increase the delivery costs. The decreased supply also means we may need to purchase vehicles that have more equipment than necessary increasing the overall acquisition and monthly lease costs.

Managing Your Client’s Expectations

All of the points above can have an impact on the partnership with your existing client or potential first time customers. This being said, it becomes important to manage your client’s expectations when it comes to account start ups and the vehicle procurement and deployment timing.

  • Make your client’s aware of the challenges facing us in the vehicle acquisition marketplace
  • If a client’s request seems aggressive, address it with your client before a timeline is set that is unachievable

You client should appreciate the candid information and allows them to also set the expectations within their organization

  • Use the information supplied in this Newsletter to help with your communications
  • For non-traditional vehicle requests such as GEM Cars, T3’s, Segways and Golf Carts please be careful with setting timing expectations as these vehicles often times need to be ordered and may not be available for immediate purchase from inventory. When they are ordered many times the status we are provided by the manufacturers is not as consistent as the standard vehicle manufacturers

Many of the suggestions above may seem “unrealistic” or “easier said than done” however the greater the communication effort up front will help your credibility and aid in building your partnership with your client. Please contact ARI for assistance if needed.

Email: – or toll free line: 877-822-7701

For general AlliedBarton fleet information, policies and procedures and frequently asked questions please visit the ARI/ABSS Driver website @

Factory Ordering Versus Out Of Dealer Stock Purchases

As a reminder you can save money and lower your monthly lease payment cost by factory ordering vehicles that are due for replacement if enough advance notice is provided. Depending on the model and time of year, factory ordered vehicles can take an estimated 8-14 weeks from order date to delivery.

For more information on the benefits and cost savings by factory ordering your vehicles in advance, please contact Jerry Pensabene @ or 856-787-6566.

DRIVE SAFELY and please look out for future ARI-AlliedBarton Fleet Newsletters

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