General Fixed Operations Department

4 Keys to Managing a Loaner Fleet

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Managing a Loaner Fleet
The keys to keeping tabs on your dealership’s loaner vehicles, and extending their life.

Lewis Ford Lincoln of Dodge City (Kan.) draws customers from a wide swath of the Great Plains.  Many of them travel 70 miles or more to visit the dealership.  

“We’re at the edge of Kansas,” service manager Jim Glover says. “And we have people outside of Oklahoma City that drive [four hours] all the way here for us to repair their vehicles.”

Many of those customers are farmers, or ranchers, who can’t afford to take an entire day off from work. They have land to tend to, and cattle to feed.

That played a factor in the implementation of Lewis Ford Lincoln’s loaner vehicle program five years ago. And, now the Kansas dealership’s valued clients—be they those that have purchased a vehicle at the dealership, or those that are service department regulars—can borrow vehicles like Super Duty pickups, so they never have to miss a day of moving livestock.

“For us, it’s major,” Glover says of his employers’ loaner fleet. Because “a lot of people, the expectation is, ‘You know, we’ve bought our vehicle from [you], we have it serviced here; if we need some help, or if we need wheels, you should be helping us.’”

Since the implementation of Lewis Ford Lincoln’s free loaner program five years ago, the facility’s customer retention rate has increased incrementally, and has neared 65 percent recently—a figure that’s all the more impressive when you consider the dealership barely markets its loaner program, beyond simple word-of-mouth.

Glover, who has managed fleets as large as around 20 vehicles in his career, explains the best ways to go about overseeing a loaner program.

 

1. Have High Standards

First, of course, you’ll need loaner vehicle inventory. In Glover’s experience, it’s easiest to keep an eye on your dealership’s used vehicle inventory and tap vehicles that are four years or younger, with no more than 80,000 miles, as loaners.

“We try to keep it to 50,000, or 60,000 miles,” says Glover, who also studied the amount of customers his department saw on a daily basis before deciding on a loaner fleet size of eight vehicles in Dodge City.

Eventually, Lewis Ford Lincoln phases a vehicle out of its loaner fleet once it has neared the 150,000-mile mark, or it has endured cosmetic damage.  

 

2. Cover Your Company’s Backside

In Glover’s experience, two especially key elements of any loaner vehicle program are loaner forms, and back-up insurance for the dealership. Lewis Ford Lincoln utilizes both. In short, customers are notified that, if an accident were to happen while a loaner vehicle is in their possession, they’re liable and their insurance carrier must be notified.

The Kansas dealership also collects a copy of a customer’s driver's license before giving out a loaner.

 

3. Be Mindful of Maintenance

Glover’s crew keeps close tabs on the mileage that loaners accumulate. The staff also gives loaners a thorough once-over upon their arrival back at the dealership, Glover notes. Additionally, the service department checks the air pressure of tires, along with oil and windshield fluids.

In order to closely monitor all of those issues, Lewis Ford Lincoln typically designates a specific service advisor to the task.

“They look at every vehicle when it comes in, so it doesn’t get back out and there’s a problem—something’s been dented,” Glover explains. It’s important to “follow through on the maintenance that’s required.”

 

4. Have a Thorough Process

Yes, Glover dreads the thought of a loyal client using one of his loaner vehicles, only to encounter a check engine light, or a low tire. Similarly, he never wants to be unsure of the whereabouts of a loaner. That’s why Glover has formulated an extensive process for ensuring that his loaner program has nary an oversight.

These days, the process for keeping close tabs on loaner vehicles includes these steps:

  • Dealership employees fill out what Glover calls a “cheat sheet,” which notes the type of vehicle loaned out, the time it left the dealership, and the estimated return time. Employees go over the cheat sheet daily, during morning meetings.
  • The dealership staff speaks with customers who return loaners, to clarify if they encountered any issues with the vehicle.
  • The designated advisor sends the vehicle to the detail department.
  • The loaner is eventually put on a lift, to clarify that there are no issues apparent on the underbody.
  • Finally, vehicle codes are examined, checking for any warning notifications.

“The same advisor will be the one that signs [a loaner] in that signs it out to the customer,” Glover explains. “And they’ll be our advocate for making sure things are working. If we run into a problem, they’ll give me a holler.”

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