| Video News & Views
PEOPLE & IDEAS TO WATCH | Seeking the Highest Subrogations Returns | | Maximizing subrogation returns begins with the first notice of loss, and CEI is tenacious in its approach to returning top results |
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July 22, 2010
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| Fleet Trends & Issues |
Opportunities & Successful Fleet Management |
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Subrogation: A Much-Overlooked Source of Fleet Revenue Chris Villela is Senior Manager of Loss Recovery and Insurance Services at The CEI Group, Inc. , a provider of collision management, driver safety and claims services for fleets and insurance companies. It’s been estimated that every year, self-insured fleets leave millions of dollars in recoverable funds on the table that could be collected through improved subrogation practices. In the difficult economic climate we’re all experiencing, a more effective subrogation solution could create a considerable financial benefit for many companies and municipal governments. Let’s say a fleet has 1,000 vehicles and 200 accidents a year, with a claim cost of $2,500 – a very conservative number because it made up mostly of the cost of repairs and a substitute vehicle rental. And let’s say that 20 percent of those losses could be recovered. That’s $100,000 in potential revenue that could go straight to the bottom line or right back into a municipal budget. For a company with an operating profit margin of 10 percent, that’s like producing another $1,000,000 in sales revenue. Fleets should compare their in-house performance with a third-party company that specializes in loss recovery. At CEI, we launch recovery claims on approximately 30 percent of the accident notices we receive, and recover funds from more than 90 percent of those claims, in an average of a little more than three months after the accident. That performance can represent a significant improvement for most fleets and even many insurance companies. How can fleets improve their results? First, it’s important to recognize that subrogation is a significant source of potential revenue. Next, it’s is helpful for an organization to measure their performance against industry benchmarks, while continuously looking outside their organization for best practices. There are a number of additional improvement areas, from launching claims sooner to making greater use of email, to taking advantage of available training programs on advanced negotiating skills. There’s also a range of outsourcing strategies for some or all of their subrogation activities that can increase efficiencies and total collection amounts while reducing internal costs. Is outsourcing expensive? It doesn’t have to be. Many subrogation service providers like CEI work on a contingency basis – we get paid only when our customer does. If a provider improves a fleet’s recovery rate, outsourcing can more than pay for itself. Outsourcing also brings with it the added benefit of freeing current resources that may already be over-burdened to concentrate on other tasks while not sacrificing collections.
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| Managing Your Fleet Selector |
OEM & Equipment Manufacturer
Products & Services |
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2011 GMC Sierra HD The GMC Sierra HD line of heavy duty trucks has been reengineered from the ground up for 2011, with a new frame, new front and rear suspensions, bigger brakes, and a new, more powerful Duramax 6.6-liter turbo diesel. At the same time, a luxurious new Denali model brings premium features and styling to the heavy-duty line. The Sierra Denali HD is a 2500HD Crew Cab with a choice of Vortec 6.0-liter V8 or the Duramax diesel with the latest Allison six-speed automatic. GMC Sierra heavy-duty pickups are well-suited for real-world use and abuse. Read more
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2011 Nissan Juke The 2011 Nissan Juke will be smallest so-called crossover vehicle to date, promising both fun and utility in an economical package. Nissan calls the all-new Juke a sport cross, and it should hit dealerships in the United States by the end of September 2010. The Juke looks something like a sport-utility vehicle, or at least a ruggedly funky wagon, and it will offer up-market features and optional all-wheel drive. Yet the Juke is substantially smaller on
the outside than Nissan's compact Rogue crossover, much less the midsize Murano.
Juke occupies less floor space than some subcompact sedans.Read more
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2011 Toyota Sienna Minivans have always been superior as people movers. They're easier to park and drive than SUVs, have a low step-in height for easy access, plus comfortable seating and cushy ride characteristics. The 2011 Toyota Sienna, now in its fifth generation, has been designed for those reasons since the beginning. But for 2011, as transportation needs change, so does the Sienna. The all-new 2011 Sienna is still very much a transportation solution for moving up to eight people. But it is now more versatile, with more flexible interior configurations, and available in a broader range of models. Read more
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| Association News & Views |
Activities, Events & Success Stories |
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AFLA Webinar: Resale Market Update July 29, 2010 11:00 a.m. ET/10:00 a.m. CT/8:00 a.m. PT Presenter: Ricky Beggs, Black Book Cost: Members/Free; Non-members/$30 » REGISTER ONLINE AFLA invites you to join Ricky Beggs, Black Book, to discuss the impact that market conditions have had on fleet vehicle resale values, what changes are occurring today, and what the outlook is for resale values for the remainder of 2010.
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Janice Sutton, Editor
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Our Video News & Views segment this week features the charming Wayne Smolda, Founder and CEO of CEI , talking about his company maximizes subrogation returns. OPENLANE's VP of Analytics, Nagi Palle, gives us his thoughts on the state of the used car market for the balance of 2010 and into 2011; and Mike Omotoso, Manager of J.D. Power and Associates' Power Train Forecasting Group, predicts the future demand of small and fuel efficient vehicles. A couple of important webinars coming up: AFLA Webinar: Resale Market Update featuring Ricky Beggs, VP and Managing Editor at Black Book. July 29, 2010 at 11 AM (EDT) Free to AFLA members; $30 for non-members. Click here to register NTEA Webinar: Business Diversification. The free Webinar is open to NTEA members and nonmembers presenting tips on business diversification and how to grow your market share. Plus, learn how you can use NTEA SMART Online Training to increase your expertise in Sales, Management, Applications and Resource Training. August 3, 2010, 10:00 AM-11:30 AM (EDT) Click here to register Have you registered yet for the 2010 AFLA Conference: Turn Change Into Opportunity - September 8-10 in Las Vegas? Click here for the details Janice Sutton
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| Places, Sites, and People for New Ideas
& Applications |
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Case Study: Turn Key Ready Vehicle Delivery How 3,000 new vehicles went from up-fitters to locations across the US – and were ready to drive upon arrival The Problem: Delivering 3,000 vehicles is a huge undertaking. When those vehicles must be moved from an up-fitting facility to locations across the US, it’s an even larger one - and could get expensive, fast. As they replaced aging units with new ones, the client also needed to find a way to sell the used assets quickly and with a high resale value, or to deploy them to be used at new locations. The Solution: Read more
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NADA Used Car Guide Industry Update - July 2010 Guidelines July should see minor (0-to-2%) value depreciation in most sub-segments, with the greatest depreciation coming on 2009MY and 2010MY vehicles. Much of this value loss is due to pricing and financing pressure from new vehicles forcing down the value of their near-new counterparts. This being said, depreciation is tracking lower than seasonal expectations as constricted supply has helped values remain relatively strong compared to historical norms. The large van segment is one notable exception bucking the value depreciation trend. Almost all model years have experienced little if any value depreciation for the month and will help solidify the year-to-date appreciation the segment has experienced. Read more
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Barry Steel
Donlen Corporation
Senior Vice President of Sales, Strategy and Development
Prospering in an Economic Downturn
Barry tells us that last year - one of the toughest times in the fleet industry - Donlen's portfolio of clients actually grew. That's quite an accomplishment and when we asked Barry how they did it, he answered our question from their clients' perspective.
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Wayne Smolda
The CEI Group, Inc.
Founder and CEO
Fleets Facing Huge Financial Challenges
Fleets are going to demand that suppliers have proof-certain that you are cutting their expenses, Wayne told us when we asked him what he sees ahead in the industry. He says that last year, CEI saved their clients more than $8 million in repair costs and recovered over $37 million in third-party damages. Impressive.
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Claude Masters, CAFM
Florida Power & Light
Manager of Vehicle Acquisitions and Fuel
NAFA's Big Tent
Besides his demanding role with Florida Power & Light, Claude serves as a vice president on NAFA's Board of Trustees. We wanted Claude's take on the challenges facing utility fleet professionals and how NAFA is helping its members adapt to a coming shift in the proliferation of hybrid electric vehicles.
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Plug-In 2010 Conference & Exposition
San Jose Convention Center
San Jose, CA
July 26-29, 2010
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AFLA 2010 Conference
JW Marriott Las Vegas Resort & Spa at Summerlin
Las Vegas, NV
September 8-10, 2010
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NTEA New Model Truck Product Conference
Hyatt Regency Dearborn
Dearborn, MI
September 13-15, 2010
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NTEA Business and Market Planning Summit
Hyatt Regency Dearborn
Dearborn, MI
September 16, 2010
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The National Safety Council 2010 Congress & Exposition
San Diego Convention Center
San Diego, CA
October 3-8, 2010
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| Conference Planning Guide |
Exhibitors, Educational Sessions, & Events |
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NAFA To Host Canadian Fleet Management Seminar In Calgary NAFA is proud to announce that Calgary will be the location for the Association’s next Canadian Fleet Management Seminar (FMS).The seminar will take place September 14-15, 2010 at the Radisson Hotel Calgary Airport. The seminar will be presented in English and feature Canadian-specific content. The Canadian FMS was designed to provide new fleet professionals (those with less than 5 years of experience) with the nuts and bolts of what it takes to run a fleet management department. Taught by experts in the fleet management sector, the FMS is a great stepping stone towards learning the fundamental principles and practices of successful fleet management. In addition to interactive and informative discussions, attendees can network with fleet professionals from all sectors and regions as they develop a basic understanding of fleet management. The cost of the seminar is $625 for NAFA Members and $675 for non-Members. After August 16, the price becomes $700 for NAFA Members and $750 for non-Members. The previous Canadian FMS, held in Montreal in 2006, was completely sold out.Fleet managers are encouraged to register early to ensure space is available. Registration may be done online at http://www.nafa.org/fms
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Stats and Smart Charts
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Fleet Manager Applications of Plug-In Electric Vehicles
[Click to enlarge graphic]
 - Donlen fleet leasing and management company’s Plug-In Electric Vehicle Survey results just released
- Designed to better understand fleet managers’ future use and application of plug-in electrics
- 35% of respondents saw plug-in electric vehicle as good fit for sales application drivers, w/ 25% targeting service drivers
- More than 25% would target Midwest region as starting point, and majority would consider multiple regions
- More than 46% would charge electric vehicles at office location, w/ 33% charging vehicles at home
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Last Minute News
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Ford: New Explorer ups fuel efficiency by 30% Ford Motor Co. today confirmed the all-new 2011 Ford Explorer will be 30 percent more fuel-efficient than the outgoing model. The improved fuel economy will be achieved because the vehicle is lighter, more aerodynamic and car-based (from the Taurus family), and it has an optional 2-liter four-cylinder Ecoboost engine, which means it is turbocharged and has direct-injection. The crossover also has a six-speed automatic transmission. Read more Safety-driven software aims to block texting while driving Technology is emerging that could solve a growing menace on the nation's highways: texting while driving. A Georgia company today announces a partnership with an Irving, Texas, firm to provide software to government agencies and businesses that disables the texting, e-mailing and Web-browsing functions of a wireless phone in moving vehicles. Manage Mobility, an Alpharetta-based management and logistics firm, will provide technology developed by WebSafety Inc. Read more Are you a distracted driver? A recent University study found using a cell phone while driving -- whether it's handheld or hands-free -- delays a driver's reactions as much as having a blood-alcohol concentration of 0.08. Another study found that four out of every five accidents (80 percent) are attributed to distracted drivers. Are you distracted when you drive? The No Phone Zone says answer these questions and find out: Read more
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Fleet People Going Places
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Sheri Smith
Union Leasing
Manager of Vehicle Purchasing
Union Leasing is pleased to announce that Sheri Smith has been named manager of vehicle purchasing. This new role has been created to fulfill the needs of both external and internal customers. Sheri has been with Union Leasing for over seven years and has played a key role in developing Union's purchasing process. In her new position Smith will continue to further enhance the procurement process, adding greater value to Union Leasing's clients.
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Glenn Brosius
Union Leasing
Purchasing Agent
In an effort to keep pace with current growth and to be adequately staffed for new business activity, Union Leasing has added Glenn Brosius as purchasing agent. Glenn is a former fleet manager for both CNA Insurance and Globe Glass. He has also worked in business development for Mike Albert Leasing and as a regional manager for the former CSC Fleet Management. With the knowledge and experience of both a fleet manager and a fleet supplier, Glenn is a perfect addition to the Union Leasing team.
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| Managing Your FleetTrends, Issues & Opportunities |
Proper Tire Inflation Most Critical Factor for Good Fuel Economy
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Fuel and oil additives and replacement of spark plugs and air filters had little to no impact on fuel economy during extended tests conducted by Windsor Police Service. Keeping tires properly inflated did make a significant difference.
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CNG Chevrolet Express, GMC Savana Coming Soon to Fleets
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GM has worked out the details of becoming the first manufacturer to offer a one-source van CNG option with compressed natural gas-powered Chevrolet Express and GMC Savana full-size vans. Deliveries start this fall and offer fleet customers a way to order CNG-powered vans instead of contracting out conversions of their vehicles.
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| Manufacturer DevelopmentsDesign, Production, & Services |
Domestic Auto Brands Take Lead in J.D. Power APEAL Study
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Ford leads domestics to retake the lead over imports with 5-segment leaders in J.D. Power and Associates 2010 Automotive Performance, Execution and Layout (APEAL) Study. Ford's winners included the Expedition, Explorer Sport Trac, Flex, Fusion and Taurus. This is the first lead for domestic automakers since 1997.
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The 2011 Ford Edge - A Very Luxurious CUV
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The 2011 Edge, arriving in dealership showrooms next month, should be a real winner for Ford in the crossover market, garnering about 11 percent of the U.S. market. Edge sales have already climbed by 35.8 percent Jan-June.
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| Driving Green Initiatives, Actions, & Implementations |
Tweaks to Midsize Cars Geared to Improve Mileage
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Automakers are using advanced technology to improve mileage, especially on their sedans, in between model changes as it gets closer to changes in federally mandated standards and to comply with consumer preferences.
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Jay Leno: Chevy Volt 'Underwhelming'
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Oops! GM gave Jay Leno a Chevy Volt to test drive late last year, but when interviewed the comedian described it as an "underwhelming compact model being phased out." "If you didn't know, you might think it's a Cobalt or a Camry," he said.
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| The Intelligent Vehicle Telematics, Telecommunications, &
Technology |
Advanced Driver Assistance Systems Could Soon Take Off
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Advanced driver assistance systems (ADAS) have achieved little market penetration despite emphasis on safety. However, advances in radar technology, lower prices and intuitive interfaces should increase market penetration soon.
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Partially Autonomous Cars Possible in Future
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Cars with voice command navigation and drive-by-wire throttle, brakes and steering autonomously are well into the future. Self-driven cars on stretches of highway are possible with existing technology in the next 15 - 20 years.
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| Driver Safety Management Practices, Policy, & Training |
Car Thefts Decline but Still Alarming Problem
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With a car stolen every 33 seconds and only 43% recovered, car thefts are still a major problem despite improving antitheft systems. Tracking technology like OnStar that can disable a vehicle and LoJack that radios location can be defeated by sophisticated thieves if owners are slow to notice theft and police are slow to coordinate with tracking company allowing system defeat.
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Arizona Pulls Plug on Photo Enforcement Speeding Tickets
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Arizona Governor Jan Brewer allowed the contract for photo enforcement speeding to expire after complaints about constitutionality and revenue shortages as violators ignored tickets not delivered in person. The cameras had produced a 19% drop in fatal crashes while data was being collected.
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| Fleet Vehicle Remarketing Marketing Strategies, Channels,
& Sales Data |
Kontos: Used-Vehicle Prices at Tipping Point
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ADESA economist Tom Kontos says used vehicles financed in April had an average retail price over $19,400, which was 61.7% of the average new-vehicle price financed that month. Kontos says 60% is the threshold that may turn used-vehicle shoppers into new-vehicle shoppers.
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Used Vehicle Prices Plateau
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For most of the year, used-vehicle prices have been on the upswing, but their rise has started to diminish. One Kelley Blue Book analyst, in particular, said this could mean that the used market has hit "a point of equilibrium." In the latest Blue Book Market Report, KBB director of vehicle valuation Juan Flores explained that lack of used inventory has been the biggest catalyst in pushing used values up. However, the robust used pricing isn't expected to stick around in every vehicle category.
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