Determining the Right Size of a Rental Vehicle Fleet: Case Study

The Virginia Department of Transportation’s Division of Fleet Management (DFM) maintains a fleet of vehicles for short-term rental to state employees traveling on official state business. This fleet, known as the trip pool, is a subset of the state-owned centralized fleet. Until May 1996, vehicles in the trip pool were not assigned in the most efficient manner, thereby limiting their maximum potential use. In May 1996, a vehicle-rental contract with a private-sector company allowed DFM to change its vehicle-assignment practices to use the vehicles in the trip pool more effectively. The private-sector vehicle-rental contract enabled DFM to reduce the size of the trip pool because excess demand could be met with private-sector vehicles. Data collected from an unpublished 1995–1996 study of DFM, together with updated data, were incorporated into a revised inventory model. The results show that the vehicle-rental contract with a private-sector company resulted in an approximate quantifiable savings of $20,000 per year. The full amount of the savings cannot be quantified because of the lack of available data. Other results indicate that the overall cost of state employee travel can be reduced by an estimated additional $20,000 per year if DFM resizes the trip pool.