French tyre manufacturer Michelin has embarked on what it believes is a “groundbreaking” focal shift away from outdated cost per kilometre (CPK) calculations toward a more savvy and sustainable approach termed Total Cost of Ownership (TCO).
Speaking at the launch of its TCO white paper, A Fleet Manager’s guide to Efficiency and Sustainability, Michelin’s managing director for sub-Saharan Africa, Amaury Vadon, said road freight could no longer be regarded as “business as usual”.
“Because of the growing emphasis on running green-friendly operations, the future cannot be envisaged without a sustainable growth model,” Vadon said.
Running a transport business in South Africa has always been a complex business, made even more complex thanks to today’s values, he added.
Clearly referring to the increased emphasis on enforcing environment, society and governance (ESG) values in road freight operations, Vadon said: “There are so many demands, it is often difficult to know where to focus.”
Through the launch of its TCO, however, Michelin believes it brings about a more holistic approach to carbon-related costs and operational efficiency.
“We have become used to thinking that the best product is the one with the kilometres behind it, CPK. But this is not true anymore. We have discovered that it is much more complex than that, which is why we have launched TCO.”
Basically, explained Vadon, Michelin has concluded that “the CPK approach is overshadowing the complexity of fleet and individual truck management”.
Based, for the most part, on using low-rolling-resistance (LRR) technology, Michelin believes hauliers can cut down on operational fuel costs, which make up to 50% of a transport company’s expenses.
Comparatively speaking, operators only spend about 5% of their budgets on tyres, so in the long run it makes sense to invest in LRR tyres.
“We empower fleet operators to re-evaluate their expenses comprehensively, recognising the role of tyres in driving fuel and operational efficiency.”
But quality tyres are not the be-all and end-all of Michelin’s TCO.
"On the whole, through meticulous research and innovation, we have unlocked a formula that empowers transporters to achieve substantial savings while embracing sustainability,” Vodan said
WATCH: Michelin sub-Saharan Africa MD Amaury Vadon talks about the tyre manufacturer's TCO approach.
