Cost pressure is likely to increase steadily for fleet operators. Fuel will remain expensive for the foreseeable future, and this is combined with the European CO2 tax on fossil fuel combustion. Various European and national regulations will force fleet operators to invest significantly in zero-tailpipe emission vehicles if they want to avoid tolls and restrictions or benefit from incentives. “This makes it more necessary than ever to positively influence operating costs via the right tires,“ says Ralf Benack. He is responsible for fleet solutions for the EMEA region at Continental.
With the new Generation 5 commercial vehicle tires, we are bringing our comprehensive consulting approach into focus. We call it LODC for “Lowest Overall Driving Costs”. Behind this is our concept that supports fleet customers in reducing their tire-related costs. To achieve this, we bring our full expertise in tires, tire service, digitization, data analysis and process mapping. We always start with tires, which form the core of our business model. Then we quickly move on to retreading, casing management, digital solutions and other elements. LODC balances economy, ecology and safety.
How LODC works
Our approach is deliberately collaborative. We rely on trust and transparency on both sides. For example, the fleet customer provides us with his telematics data. We use this data to derive suggestions for cost savings – and then implement them consistently together. We don’t leave it at the theoretical calculation of potential savings, but tackle it together with our service partner network and see tangible results. Thus, LODC is not a tire sales approach, but a cost optimization method. Depending on the results of the analysis, it leads to a combination of products, services and solutions with the aim of optimizing costs for the customer. Sustainability in the literal sense also means an intensive customer relationship. It is not about short-term sales thinking, but about a long-term partnership.
Who can use LODC?
- Fleets of any size with different applications and configurations
- Especially medium to large national and international fleets in freight and passenger traffic
- Rental and leasing companies
- Our partners like BestDrive or Vergölst especially address small to medium sized local and regional fleets
Share of tire costs in total fleet costs
Tires have a significant impact on the fuel, maintenance and repair costs of a fleet. They account for more than 27 percent of total costs. Therefore, tires are a key lever and LODC is a real success factor for fleet customers in difficult times.
Important set screws of the LOCD approach
The key levers are certainly optimal tire selection, maximizing uptime, measures to extend tire performance and fuel efficiency, data-driven service management and thus tire checks at the optimal time, 24/7 breakdown service, and optimization of ordering, administration and billing processes.
Retreading: saving costs and resources, increasing sustainability
At LODC, when we look at the most suitable tire for a particular application situation, we always think about the corresponding retreading solution – i.e. the ContiRe tire – at the same time. Actually, we start even earlier, in tire development. Our engineering teams for new tires and retreads work closely together. Our ContiLifeCycle plant in Hanover, where the ContiRe tires are manufactured, is just a stone’s throw away from research and development. In retreading, we can reuse around 70 percent of the original tire. That saves raw materials, water and energy.
There is also the cost aspect: retreaded tires are cheaper than new tires – and yet absolutely safe and durable. A worn Continental tire that has been professionally retreaded using our hot or cold retreading solutions performs just as well as a new Continental tire. By using our retreading solutions with well-maintained Continental casings, they can reduce their tire costs by 30 to 40 percent. Hence the importance of retreading to our LODC approach.
What are your pain points in fleet management? What experience do you have with retreaded tires? How far are you with digitizing a fleet? Write it in your comment!