Enhancement of vehicle fleet for insurance purposes and definition of disposal strategy
The valuation, for insurance purposes, of the vehicle fleet of an operator in Emilia Romagna currently takes place through calculation tables which, in some cases, do not represent the real market values of the buses.
With this in mind, the operator has expressed the need to update the commercial values of its vehicle fleet for insurance purposes, in order to define the correct compensation value in the case of an "event".
The opportunity therefore emerged to develop a disposal strategy aimed at maximizing the realizable value of the vehicles.
Enhancement of the vehicle fleet for insurance purposes
The objective of this phase is that of the correct market value of the individual vehicles in order to obtain the correct insurance compensation in the case of an "event".
The process is divided into 5 steps:
- Book valueThe first parameter to identify the value of the vehicle starts from the calculation of the depreciation in relation to its seniority. Amortization is usually calculated over 15 years and allows you to have a first point of reference from which to start for the economic-commercial analysis.
- Analysis of the intrinsic commercial attractiveness of the vehicle: Some vehicles are rewarded and requested by the market more than others. This difference in demand is referred to as inherent commercial attractiveness. Each market differs from the others on the basis of cultural factors (the French market is much more closed to external suppliers than the Italian one), geographical and infrastructural factors (the morphology of the Italian or Spanish cities), the diffusion of a and even up to the weather conditions.
- Analysis of the state of use: The analysis of the state of use of the vehicle includes the analysis of the mileage, the analysis of the mechanical state and the analysis of the state of the internal and external bodywork. This analysis requires various precautions, of which some examples can be given: a vehicle that has traveled 500,000km in a flat area will probably have the gearbox and braking system in better condition than a vehicle that has traveled the same km in a mountainous area . Therefore the state of use also has an impact on the commercial value of the vehicle being valued.
- Analysis of the technical characteristics: The analysis of the technical characteristics involves the analysis of those characteristics that can have a rewarding or negative impact on the economic-commercial evaluation of the vehicle. In the technical characteristics we find: anti-pollution legislation, power supply, type of gearbox, number of doors, presence or absence of a disabled platform, etc.
- Analysis of the commercial attractiveness of the vehicle based on current market conditions: lastly, the vehicle must be analyzed on the basis of current market conditions, which can marginally impact its commercial attractiveness and therefore its economic value. Current market phases can be: allocation of public funding for the purchase of new vehicles, price of fuel or methane, concentration of funding on a particular vehicle class (urban or interurban), etc.
The objective of this phase is to develop a vehicle disposal plan that maximizes economic value to the business while taking into account the constraints imposed by the current service contract.
The achievement of this objective took place in two steps:
- analysis and definition of which vehicles to dispose of;
- development of the related disposal strategy.
The analysis and definition of the vehicles to be decommissioned took place by integrating the information regarding:
- planned investments;
- current and future reference regulations;
- maintenance costs;
- technical characteristics and state of use of the vehicles;
- type of service provided;
- expected depreciation curve.
At the end of this phase, the vehicles to be disposed will be identified, the timing of disposals, the methods and the relative valorisation will be defined.