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Highway Maintenance Fleet Equipment Sourcing Decisions: What options are used and when to augment equipment fleets?

Description:

Equipment fleets seek to balance capital and operating costs in a way that achieves minimal lifecycle costs. In practice, this means trying to balance fleet equipment over-and-under use. This often results in the need to augment owned fleet equipment assets to meet seasonal or other short to medium term needs. State DOTs make decisions to augment their fleets using different sourcing options. However, how these decisions are made and the particular circumstances are not documented. Research on how state DOTs determine (and if they determine) the most cost-effective fleet equipment sourcing options is needed. For example, ownership, renting, leasing, etc.

At its most basic, fleet equipment needs are driven by supply and demand. For DOT equipment fleets, “supply” is the number (and availability and location) of units of a given type that a DOT owns as well as any commercial souring option available. “Demand” is driven by the activities a DOT chooses to self-perform versus contract. In non-emergency fleets, a common approach is managing utilization is to size the owned fleet to meet the consistent, ongoing need with demand overflow handled using commercial rentals. More systematic approaches to this question include calculating the relative cost differential between the ownership and rental options. Even more sophisticated approaches including assigning values to balance the cost (and risk) of having unutilized units against the risk of needing a unit and not being able to meet that demand.

For DOT equipment fleets, the mission demands of the agency include emergency operations considerations that complicate efforts to minimize lifecycle cost. The most common and reoccurring of these needs is winter maintenance operations but also includes the need to respond to natural disasters. Because of these emergency mission needs; DOTs typically prefer to err on the side of having slightly more equipment rather than risk needing equipment and not having that equipment available.

Objective:

As state DOTs equipment fleets strive to minimize the cost to provide needed fleet equipment at the needed locations and time, many are also seeking knowledge of how others make the most cost-effective choices amid commercial sourcing options and internal sharing models (that have certain associated costs). Some states have experience leveraging alternatives; however, no guidance exists for DOT equipment fleets on decision making. This results in an opportunity to research this subject in a formal manner. The initial research will likely identify gaps in sourcing decision making knowledge and data which would confirm the need for the development of an equipment sourcing decision making aid such as a matrix or electronic tool.

Benefits:

Research would provide guidance and a tool for DOT to make cost-effect equipment sourcing decisons.

Related Research:

NCHRP Project 13-05 Guide for Utilization Measurement and Management of Fleet Equipment

The following sources may be relevant but are not directly relevant to DOTs:

· Longhorn, Dave & Stobbs, John. (2019). Optimal Fleet Sizing Application for Military Ground Vehicles.

· Roy, Debjit & Sebastian, Joseph and Sharma, Dheeraj. (2013). Fleet sizing for transporters with seasonal demands.

· El-Ashry, Moustafa. (2007). The Fleet-Sizing-&-Allocation Problem: Models and Solution Approaches.

· Hungerländer, Philipp & Steininger, Sebastian. (2019). Fleet Sizing and Empty Freight Car Allocation.

· Parikh, S. (1977). On a Fleet Sizing and Allocation Problem.

· Caballero-Parga, D. & Esteva, Santi and Figueras, Albert. (2010). Fleet size of robots for rescue missions.

· Li, Jianxun and Lai, Kin Keung & Lin, Qiuping. (2019). Robust Optimization Solution to Emergency Mobile Facility Fleet Size and Location.

· Beaujon, George & Turnquist, Mark. (1991). A Model for Fleet Sizing and Vehicle Allocation.

· El-Ashry, Moustafa. (2007). The Fleet-Sizing-and-Allocation Problem: Models and Solution Approaches.

Tasks:

· Literature review

· A survey of state DOTs, focusing on the state fleet managers

· Follow-up interviews with selected agencies for the development of case examples

· Identification of knowledge gaps and research plan to develop a decison guidance and tool.

Implementation:

<not yet addressed>

Relevance:

for DOT fleets

Sponsoring Committee:AKR30, Maintenance Fleet and Equipment
Research Period:24 - 36 months
Research Priority:High
RNS Developer:Henry Canipe and Lisa Kunzman
Date Posted:05/22/2022
Date Modified:05/22/2022
Index Terms:
 
Subjects    
Maintenance and Preservation
Vehicles and Equipment

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