Peregrine Trucking Co. Business Plan Sample

Business processes around the world are being revised, and changes are being made because the need for cost minimization and profit maximization are more critical than they have ever been. All resources whether natural or man-made are in limited supply; consequently, the transportation industry is utilizing energy sources at an exponential rate.
In the midst of the situation described here, the Peregrine Trucking Company aims to establish a competitive advantage for implementing a strategic plan that would be environmentally friendly. In order to create an environmentally friendly plan, the company would introduce equipment that is more efficient and socially acceptable as ethical.
The paper that follows would be focused primarily on the benefits of reducing fuel costs for Peregrine Trucking Company. To assist in describing the benefits gained by the company and the environment several tools, equipments, and methods of fuel expenditure reduction would be discussed.
In general, the paper would also help in the discussion of the business processes commonly used by the transportation industry, but with special reference to Peregrine Trucking Company.
The past two decades have experienced a growth in the transportation industry which means that the competition within this sector has also intensified. As economies move towards betterment and are on the road to recovery, it should come as no surprise that the demand for freight transport would also increase simultaneously.
The expected increase in the transport industry puts pressure on the transportation network. Moreover, it also challenges the community to accept this increase in demand as it lays a pressure upon the environment and safety of communities.
In order to gain better acceptance, it is the responsibility of people associated with this industry to identify alternative cost and energy saving methods in order to reduce costs in terms of fuel and the environmental impact.
The increase in annual car and light truck sales are expected to grow from 65 million in 2006 to above 140 million by 2050 (IAI, 2008). The growth of the transportation industry is partly the doing of the technological advancement because the technology sector has been successful in introducing fuel-efficient equipment and alternative energy sources to replace fuel.
For the Peregrine Transportation Company fuel acts as a direct cost which the company has to incur. Consequently, the Peregrine Trucking Company is working towards looking for alternative sources of fuel as this would lead to major cost reductions.
If the company is successful in reducing fuel costs, they will be able to maximize profitability of the firm because the fuel cost has a direct relationship with profit. Moreover, the firm would also be able to gain the competitive advantage if they are able to identify an alternative to fuel as a cost efficient option.
The paper discusses various technologically savvy equipments that are specifically designed to save fuel and reduce the harmful effect of the environment in the form of the greenhouse gas emissions, in an attempt of strategic transportation planning.
If the methods are adopted and implemented, it would allow the company to become socially conscious and would also serve as a benefit to the economy and various stakeholders as well.
One option available to Peregrine Trucking Company is to make use of the turbocharger engines because turbo engines are known for less consumption of fuel. These turbo engines require less fuel because the heat they generate is converted into energy source for the engine while it is operating.
Thus, if Peregrine Trucking Company makes use of the turbocharged engines, they would experience a reduction in fuel costs and would also have a positive impact on the company and society at large. At the start of the 1990’s the turbocharging technology was introduced to the transport industry (Gereffi & Dubay, 2008).
As compared to the naturally aspirated engine the power to weight ratio of the kilowatt/kilogram of the turbocharged engine scores better (Basin, 2008). The positive effect of the environment is possible because the carbon dioxide emitted by the turbo engine is also less than the ordinary engines of trucks. Hence, it can be said that the technologically advanced trucks would be a better option for the environment as well as the company.
One way to reduce fuel consumption by trucks and reduce costs for the company the drivers must ensure that speed limits are kept constant on highways. People who believe in this idea of fuel consumption also propose another advantage of constant speeds on highways that this would reduce accidents; thus, be a tool for social advantage as well.
If the trucks are not allowed to cross the 55mph speed limit, the mileage of the vehicle may be increased per unit and could also lead to efficient fuel consumption and cost reduction. Speed limit over and above 55mph decreases the fuel economy by 0.1 mpg (Cummins, 2007).
Along with reducing the fuel costs for the company speed limits also place restrictions on the pollutant emissions in the environment (Environmental Defense Fund). In order to make this change, possible electronic speedometer or limiters could be installed in these vehicles.
One other factor that has an impact on low fuel cost and usage are the low resistance tires. This is possible because as every tire moves down the road it would create a drag force that would contribute towards the creation of more energy.
This creation of energy is comprised to the loss of energy created by the deflection and compression of the tire sidewall and tire treat respectively. The drag force thus created is also known as rolling resistance. In order to reduce the resistance of tires, it is essential to have low resistance tires because they have less contact with the road.
Those trucks that have low resistance tires installed are easier to accelerate and are also known for less fuel consumption. Consequently, the Peregrine Trucking Company could take advantage of these low resistance tires in order to save costs from fuel consumption.
According to a research by the Environmental Defense Fund’s Transportation Research Board, the average rolling resistance of tires by 10 percent could increase fuel economy by 1 to 2 percent. Low resistance tires could contribute towards savings more effectively if the following items are taken care of; full inflation of the tires and ribbed tires.
When the tires are fully inflated for every 10 PSI, there is a saving of 1 percent in the fuel economy. On the other hand, ribbed tired would provide fuel economy of 2 to 4 percent as compared to lugged tires.
Tires are one of the core reasons to be creating a difference in the MPG of the vehicle below 50 mph (Cummins, 2007). The Peregrine Trucking Company needs to focus upon the installation of auxiliary power units in its trucks as this would help towards the reduction of carbon emissions through elimination of the idle times of the vehicle.
Every hour of idle time the vehicle experience the fuel economy of the truck would reduce by 1 percent (Cummins, 2007). Through the auxiliary power unit, the truck drivers can enjoy air conditioning when they take breaks during long-hauls.
In 2005, Wal-Mart had the second largest fleet in the whole of United States, and they aimed towards the introduction of doubling the efficiency of these fleets by 2015 (Gereffi & Dubay, 2008).
Once the fleet is doubled, 13 million tons of carbon dioxide emissions would be prevented. In order to reach the objective, Wal-Mart purchased and installed 7,000 APU’s in the long-haul trucks. With the introduction of APU’s at Wal-Mart, they have saved up to $25 million in annual fuel costs, and this is expected to increase as global oil prices have increased over the years.
If the company lowers the weight of the vehicles, they will be able to reduce the consumption of fuel and eventually the cost. One way to reduce the weight of vehicles would be to install the diesel tank, toolbox, and battery box made of aluminum.
However, it can be said that the weight of the truck and fuel consumption is in direct proportion. According to the Aluminum Association’s Transportation Group’s IAI the benefits of aluminum being installed in vehicles contributes towards 525 pounds of weight savings that could result in gaining 2.7 miles per gallon.
These are just a few examples, but in order to implement complete fuel savings every body part of the truck should be made of aluminum. For instance; the tire rims could be made with low weight metal; however, it must be ensured that the strength of the metal is not compromised. Peregrine Trucking Company should implement the use of aluminum in the body of the truck to contribute towards fuel cost savings.
Wind resistance is one of the major contributors towards fuel consumption in trucks. The higher the wind resistance the greater would be the consumption of fuel, and the cost for the company would go up. The company can save up to 1 percent in the fuel trucks economy if they reduce 2 percent in aerodynamic drag.
The aerodynamic drag becomes the most important factor if the truck goes above 50 mph. Hence, the company’s trucks can be modified if they introduce the aerodynamic technology in trucks to reduce fuel consumption.
Companies of the transport industry can develop competitive advantages if they work towards the introduction of alternative fuel options and the latest technology. Moreover, low fuel consumption also leads the industry to create an image that they are environmentally conscious.
If the Peregrine Trucking Company upgrades their vehicles and installs the turbocharged engines, aerodynamic body parts, low rolling resistance tires, and auxiliary power units they would end up saving fuel costs for the company as a whole.

References

Basin, F. (2008). enviroTruck: T. he Cleaner, Greener Transportation Choice. Backgounder.. Retrieved 2 March 2015, from http://www.fraserbasin.bc.ca/news/documents/BG_enviroTruck_June_26_2008.pdf
EDF,. (2015). Environmental Defense Fund. Greenhouse Gas Management for Medium-Duty Truck Fleets A Framework for Improving Efficiency and Reducing Emissions. Retrieved 2 March 2015, from http://business.edf.org/sites/business.edf.org/files/ghg-management-medium-duty.pdf
Gereffi, G., & Dubay, K. (2009). Manufacturing Climate Solutions: Carbon-Reducing Technologies and U.S. Jobs,. Duke University. Retrieved 2 March 2015, from http://www.cggc.duke.edu/environment/climatesolutions/greeneconomy_Ch3_AuxiliaryPowerUnits.pdf
Secrets of Better Fuel Economy. Cummins MPG Guide,. (2007). Cummins MPG Guide. Retrieved 2 March 2015, from https://docs.google.com/viewer?a=v&q=cache:6frJHXdI1vYJ:www.nptc.org/index.php%3Foption%3Dcom_
Transport and Aluminum. IAI.,. (2008). International Aluminum Institute. Retrieved 2 March 2015, from http://www.world-aluminium.org/media/filer/2012/06/12/fl0000172.pdf