Metropolitan Police Service fleet strategy

Report: 6
Date: 8 November 2001
By: Commissioner

Summary

Financial pressure and the arrival of new senior managers caused the MPS to consider the way its transport resources are used and managed. Consequently, in November 2000, TRL Ltd. was commissioned to produce a strategy for the fleet. The strategy was submitted in September 2001 and made suggestions about changes that could take place in the short to medium term. Six recommendations were put before Management Board on 17 October 2001 and were approved. These are now reported for the MPA to note.

A. Recommendations

Members are asked to note the decisions reached by the MPS Management Board.

B. Supporting information

1. After being commissioned to produce the Strategy, TRL consulted widely throughout the MPS. After a slight delay, caused largely by the amount of information generated by the consultation process, a first draft of the strategy was produced in June of this year. This was subjected to further consultation, principally via workshops attended by all interested parties. As a result of this process, the final version was produced in September.

2. Initially, the recommendations were discussed informally by the Commissioner's Senior Management Team.

3. They were subsequently considered by the MPS Resource Allocation Committee and recommendations forwarded to Management Board on 17 October 2001, where they were considered and finally approved. A copy of the recommendations considered by Management Board is attached at Appendix 1.

4. As part of a request from Management Board that a communication strategy inform the MPS of these recommendations, a group of interested parties was convened and met for the first time on 29 October 2001.

5. This group also serves as a working party to determine the criteria most relevant in creating a formula to allocate vehicles.

6. The outcome of the Transport and Fleet Review is summarised as follows:-

1. Area Cars, Traffic Cars and Armed Response vehicles should consist of a single model but retain their separate roles. The model should, in respect of the Area Car, be upgraded from the current Vauxhall Vectra to either the Vauxhall Omega 3.2, used by Traffic or the BMW 530 3.0 Diesel, used by the Armed Response Units. Another model should fulfil the two roles of the Incident Response Vehicle and Panda Car.
2. There should be a formula to ensure correct vehicle allocation (this is consistent with the recommendations of the Accenture review.)
3. There should not be a 'pool' of extra vehicles to ease availability.
4. Vehicles should continue to be purchased, not leased.
5. As far as operational requirements permit, there should be standardisation of models on the non-Borough part of the fleet.
6. There should be a presumption that all police vehicles will be marked and liveried unless operational reasons dictate otherwise. Consideration will be given to painting them silver as opposed to white.

C. Financial implications

In considering its methods of vehicle procurement, there were essentially two issues for the MPS:

• Continue to purchase
• Lease some or all of the fleet.

Movement from purchasing to leasing, transfers pressure from the 'capital' budget to the 'revenue' budget. The disbenefits of leasing were not considered sufficient to outweigh the benefits of ownership at this time. A whole life cost approach to each vehicle has now been adopted so that purchasing represents better value.

In respect of a single model fulfilling the roles the Area Car, Traffic Car and Armed Response Vehicle, the BMW 530 3.0 Diesel offers Best Value. Assuming the same whole life costs for the three models fulfilling these three roles, the Vauxhall Vectra 2.6, the Vauxhall Omega 3.2 and the BMW, choosing the BMW would increase the Traffic Car fleet by ten and reduce the Area Car fleet by only two. The Omega would reduce the Armed Response fleet by five and the Area Car fleet by 15.

The Vauxhall Astra 1.4 has been suggested as the single model to fulfil the roles of the Incident Response Vehicle and the Panda Car. Again, assuming the same whole life costs, 518 Astras would be obtained for the 344 current Incident Response Vehicles and 287 Panda Cars; a deficit of 113. However, the 518 represents an increase of 174 response vehicles, (518-344). A recently completed Fleet Review identified vehicles currently used in non operational units which can be transferred, in terms of their value, to Borough Operational Command Units, thereby reducing the deficit. It is anticipated that the loss of 113 vehicles can probably be overcome, although, given the nature of the Vehicle Replacement Programme, it will take about four years to achieve.

Although more detailed costings need to be carried out, reducing the numbers of models across the non Borough fleet will give greater potential for discounts when purchasing them and enable our outsourced maintenance provider to achieve greater availability because of standardisation of spare parts and training. This will, in turn, further reduce the need for hiring vehicles to make up for deficits in availability.

The precise number of vehicles to be marked and liveried, and hence purchased in silver, has yet to be determined. Consequently, detailed costings remain to be resolved. However, it is known that silver vehicles achieve greater residual values than white ones. Therefore, some savings will accrue by choosing silver over white as the standard colour for the MPS fleet.

The MPS will continue to purchase second hand vehicles in specific instances. However, particular problems can arise in respect of the mainstream fleet because it is difficult to obtain vehicles of the right specification, in the required numbers, of the right quality and at reasonable cost. Any significant move away from new vehicle purchase would be likely to lead to a reduction in current discounts.

D. Background papers

Copies of the full Fleet Strategy have been previously distributed to members of the Committee.

E. Contact details

Report author: Commander Alan Given, MPS.

For information contact:

MPA general: 020 7202 0202
Media enquiries: 020 7202 0217/18

Appendix 1: Summary paper considered by MPS Management Board on 1 October 2001, MPS fleet strategy key strategic issues

Introduction

Unrelenting financial pressure has resulted in the MPS considering the way all of its resources are used and managed. In order to ensure that the fleet was in the most efficient and effective condition, a fleet review was commissioned. A recent study undertaken by TRL has made a number of recommendations about the fleet and it's suitability for the purpose.

The TRL document is long and addresses a number of key areas. This paper highlights the main findings and makes recommendations about changes that can take place in the short to medium term. Six areas are discussed and require Management Board decisions.

The following areas are open for discussion:

• Fleet composition
• Fleet allocation formula
• Vehicle pooling
• Purchasing the fleet versus leasing the fleet
• Standardisation of the non-borough fleet
• Appearance of the fleet

1. Composition of the fleet

The role of the area car has recently been questioned. There is ambiguity and overlap between its role and that of the IRV. Essentially, the significant difference is that the area car should carry out a pursuit function. Recent research, however, carried out by the 'Transport Services Department' indicates that the area car completed only about 5% of all pursuits, IRVs completed the remainder.

Taking into account training, maintenance, equipping and repair, the area car is considerably more expensive to operate than the IRV.

Recent technological developments suggest that vehicles suitable as IRVs are almost as powerful as area cars and cost significantly less.

In reality many of the functions of the IRV are also carried out by pandas and general purpose vehicles.

Consideration should be given to merging the roles of the some of the vehicles within the fleet.

The station van does not feature. Its role should remain unchanged.

In essence, there are 3 options:

Option 1
Retain the status quo with separate types of vehicles for each role.

Option 2
Area cars, traffic cars and ARVs should consist of a single model but retain their separate roles. Another model should fulfil the 3 roles of the IRV and Panda Car.

Option 3
There should be a single, multi purpose vehicle, fulfilling the roles performed by the 3 main types of BOCU vehicle: the area car, IRV and Panda Car.

Advantages and disadvantages

Option 1

• Morale of area car drivers retained.
• Pursuit capability retained.
• Retention of area car is for tradition only and of little practical benefit.
• Should there ever be a move to lease this part of the fleet, it will be more difficult with several types of vehicles to be catered for.

Option 2

• Morale of area car drivers retained.
• Pursuit capability retained.
• Panda Cars are already being used to respond, therefore an upgraded vehicle, designed for immediate response would be an advantage.

This option sees the amalgamation of the area car, the ARVs and traffic cars. Currently three models are used to fulfill threes three functions:

If any of these cars were use to fulfill all three functions the numbers of vehicles in each of the three disciplines would changes as follows:

Vauxhall Vectra

BMW 530

Vauxhall Omega

In terms of performance, the BMW and Omega are far superior to the Vectra.

Test data on 0-60 mph times and on top speed taken from 2 sources; the MPS and the manufacturers indicate the following:

MPS data

Manufacturers data

Option 3

• One type of multi role vehicle would make future leasing of this part of the fleet easier.
• Would make the 'Pool' concept easier to operate.
• Pursuit capability could be left in doubt.
• Possible detrimental effect on morale of area car drivers.

Assuming the current expenditure and using a number of different models as the sole operational vehicle, it is possible to predict the size of the fleet.

There are currently 740 vehicles in total. That number would be reduced in every case as follows:

NB: Where, in any of the above options, drivers of different classifications had to drive the same vehicle, they would be only permitted to drive it in the mode allowed by their classification; basic, response or pursuit.

It is recommended that Management Board agree 'Option 2'

BOCU fleet mix

If a response capability is to be maintained, a question arises about what to do with the remained of the operational fleet i.e. the IRVs, Pandas and GP Cars.

Using a single model to fulfil all of the roles would lead to a reduction of approx. 240 vehicles, which is not acceptable.

Given that response puts such a demand on BOCUs and a reduction of 240 would be unreasonable it is proposed to merge the IRV and Panda Car retain the GP Car.

If the Vauxhall Astra 1.4 is used as the single model for the IRV and Panda car, the fleet will suffer a reduction of 113 vehicles.

The Fleet Review (February 2001)

The Fleet Review (February 2001) identified 92 vehicles in TSD, PSD, TSG and Traffic for re deployment. The nature of the re deployment has yet to be determined, but reinvesting the capital would go a long way to mitigating the loss of 113.

Revenue costs such as equipping for service, are associated with new cars but there are also hidden revenue costs associated with the 92 vehicles, which is not included in the £685K. A detailed breakdown of revenue costs is unavailable but the total is unlikely to significantly influence the estimated figure of 85-86 new vehicles.

The Fleet Review (Feb 2001) also identified 380 under utilised BOCU unmarked GPs, Surveillance Cars and Vans, Personnel Carriers and Supervisory Vehicles. The review proposed the removal of 172 of these vehicles and replacing them with marked cars.

In summary the deficit of 113 can probably be overcome, although, given the nature of the Vehicle Replacement Programme, it would take approx. 4 years to achieve.

Driver training

If the current BOCU IRV and Panda Car fleets were to merge, the issue of diver training would need to be addressed. Currently there are 344 IRVs, but this initiative would produce 518 response vehicles and a requirement for 51% more response drivers.

Technology is already available which will prevent an officer from driving a vehicle for which he/she is not authorised and will be piloted on a BOCU next year.

2. Formula for allocating vehicles

Once the composition of the fleet has been established the next logical step is to find a basis upon which to allocate the vehicles. At the time of vehicle replacement, a BOCU can use discretion to select a new vehicle within an established 'points system', a system which is difficult to track to its origins.

There is a need for an agreed formulaic approach to the allocation of the vehicle fleet

The consequence of not producing such a formula is that some BOCUs will continue to struggle when accidents and unscheduled repairs reduce their capacity to operate efficiently. Interestingly, some BOCUs never seem to suffer difficulty even when they lose vehicles. It would appear that there are currently imbalances in vehicle establishments across the BOCUs.

Some work has already been undertaken in 'Transport Services Department' to try to determine an allocation methodology. There is probably no perfect solution awaiting discovery, along the lines of a scientific theory, the next best thing, therefore, is to establish criteria which are generally accepted as relevant.

Criteria under consideration revolve around:

• vehicle utilisation
• numbers of 'I' and 'S' calls per BOCU and
• numbers of officers

Management Board is asked to approve work to establish a vehicle allocation formula.

3. The vehicle 'pool'- corporate ownership of the fleet.

Under a pooled system, BOCUs will not have specific vehicles allocated to them. An allocation formula would establish the number of vehicles to which it is entitled, but all vehicles would remain 'corporately owned'.

Vehicles could be replaced in two ways:

• Vehicles lost through accidents or the maintenance programme would be replaced immediately with the first available vehicle of the same type.

The target to which Venson is contractually obligated to meet is currently set at 88%. If it were determined that no OCU would fall below 88% availability, then a system of constant re-allocation would need to be developed to maintain the 'shared pain' To guarantee 88% availability a pool of about 77 vehicles would be necessary.

• Alternatively, vehicles could be replaced from a 'replacement pool'

If it were determined that an OCU should retain 100% of it fleet 100% of the time the reserve pool would need to consist of between 250 and 300 vehicles to cover the average 'off the road figure'

Whilst the 'Pool' concept would seem to guarantee better availability of vehicles, there are several issues, which may make the system difficult.

Some parts of the MPS do not have easy access to repair sites.

A reserve pool of vehicles would be necessary to ensure the success of either version of the scheme.

Pool vehicles could be idle until allocated.

Purchasing 77 appropriate vehicles would cost approx. £400K per annum.

A significant increase in the fleet would probably require re-negotiation with Vensons

Resources would be needed to 'police' the constant redistribution

Boroughs may be less keen to maintain vehicles for which they have little or no ownership.

Management Board is asked to consider rejecting the concept of 'pooling' vehicles

4. Purchase or lease

Perceived financial pressure suggests that the MPS should consider its methods of procurement.

There are essentially two issues:

• Continue to purchase.
• Lease all or some of the fleet.

Movement from purchasing vehicles to leasing vehicles transfers pressure from the 'capital' budget to the 'revenue' budget!

It is recommended that Management Board approves Option 1.

Second-hand vehicles

The MPS already purchases some second-hand vehicles at auction for use in support of Boroughs; for example 'Operation Strongbox' and 'Eagle Eye', where a certain amount of diversity is advantageous.

Particular problems, however, can arise in respect of the mainstream fleet. It is difficult to obtain vehicles of the right specification, in the required quantity, of the right quality and at a reasonable cost.

Quantity

The MPS purchases its mainstream fleet to strictly defined requirements. It stipulates a number of safety features: up-rated brakes, suspension, airbags etc. Such up-rated specification on a base model attracts significant discounts when compared to manufacturer's retail prices.

In the used car market these features are very rarely incorporated completely on one model, unless it is top of the range. To obtain vehicles with the appropriate braking system, suspension etc through the second hand market would result in the MPS buying vehicles at a much higher specification than that actually required. This is likely to cost more than the base vehicle.

Quality

Purchasing second-hand vehicles would not guarantee previous service history. A complete safety check would be necessary which would lead to additional costs.

New vehicles come with an extended warranty. This would not always be the case for second hand ones; even if they were only one-year-old.

Manufacturer's put considerable effort into developing police specification, especially in the area of electronics thereby ensuring vehicles' compatibility with specialist equipment including radios. Such enhancements are not generally available on normal specification vehicles.

Cost

The significantly discounted prices available to the MPS mean that, for example, a year old vehicle with low mileage would probably cost a similar amount as purchasing a new one directly from the manufacturer.

We currently pay under £6,000 (VAT exclusive) for a Ford Fiesta 1.3 Encore 5 door new from the manufacturer (this includes all the necessary enhancements for police use). This is the model currently used for both the GP and Panda Car. Trade publications price the same model 1-year-old at auction with 5,000 miles at just under £5,000, with a retail value on a dealer's forecourt of almost £6,000 (i.e.: more than the MPS originally purchases it for). In addition, there would be auction costs which would add approx. £100. There would, therefore, be a small saving over a new vehicle. However, the MPS specifies, for officer safety, twin airbags. This would cost an extra £200. Few specific second hand cars are available with this option enhancement.

Any significant move away new vehicle purchase could lead to a reduction in the discounts which the MPS currently attracts. It is difficult to quantify the likely impact. However, two of our main suppliers, Vauxhall and Ford, offer us further discounts beyond those of the Home Office framework agreement of several hundred pounds per vehicle dependant upon model and quantity. Any reductions in volume may lead to the prices we pay increasing and being closer to those specified in framework.

5. Standardisation of non borough fleet

There is considerable diversity in the non Borough fleet. For example, the SO fleet utilises 121 models. Whilst much of this diversity results from sound operational imperatives, it conflicts with Treasury Advice which is to reduce vehicle categories and standardise wherever possible.

SO has in excess of 100 General Purpose Cars of a higher specification than those on boroughs. If these vehicles were to be downgraded to the fiesta (borough model), the MPS would realize a saving of approx. £250K over the 5 year life of the vehicles.

Management Board is asked to decide whether, in principle, the non Borough fleet should be standardized as far as operational requirements permit.

6. The appearance of the fleet

Less than 40% of the fleet is identifiable as a police vehicle. Whilst it is obviously inappropriate to mark and livery all of our vehicles, for example, those employed on covert operations, there is still room to improve matters.

There should be a presumption that all police vehicles will be marked and deliveried unless operational reasons dictate otherwise.

The requirement for the standard white colouring of Borough and other 'front line' vehicles needs to be researched. Markings cover a large proportion of the paintwork and the base colour has become less critical to their appearance. Other colours may provide greater residuals and improved flexibility in procurement. As an example, other Constabularies have found that silver vehicles are easier to sell and additionally provide a greater residual value.

Management Board is asked to consider whether silver (as opposed to white) vehicles are appropriate for the MPS fleet.

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