What is a strategy to control vehicle depreciation?

What is a strategy to control vehicle depreciation?

• A. Using only electric vehicles
• B. Creating a good fleet mix
• C. Lowering the cost of rentals
• D. Increasing the number of vehicles

Answer: (B)

Creating a good fleet mix is a strategy that contributes effectively to controlling vehicle depreciation. A well-balanced fleet that includes a variety of vehicle types can improve overall resale values and allow the organization to cater to different customer needs. By diversifying the fleet with vehicles that have strong demand in the resale market, organizations can mitigate the impact of depreciation. For instance, incorporating a combination of economy cars, SUVs, and larger vehicles can help ensure that when it comes time to sell or trade in vehicles, there is demand for those specific types, thus preserving value. In contrast, options such as using only electric vehicles may limit flexibility and customer choice, which can affect sales and resale values. Lowering rental costs might increase sales volume temporarily but does not inherently control depreciation and could undermine perceived value. Increasing the number of vehicles without a strategic approach to the types of vehicles can lead to oversupply in areas where there’s lower demand, which may negatively impact depreciation as well.

Creating a good fleet mix is a strategy that contributes effectively to controlling vehicle depreciation. A well-balanced fleet that includes a variety of vehicle types can improve overall resale values and allow the organization to cater to different customer needs. By diversifying the fleet with vehicles that have strong demand in the resale market, organizations can mitigate the impact of depreciation. For instance, incorporating a combination of economy cars, SUVs, and larger vehicles can help ensure that when it comes time to sell or trade in vehicles, there is demand for those specific types, thus preserving value.

In contrast, options such as using only electric vehicles may limit flexibility and customer choice, which can affect sales and resale values. Lowering rental costs might increase sales volume temporarily but does not inherently control depreciation and could undermine perceived value. Increasing the number of vehicles without a strategic approach to the types of vehicles can lead to oversupply in areas where there’s lower demand, which may negatively impact depreciation as well.