Fleet Optimization in 2025: How to Reduce Your Costs?

“Our fuel bills are skyrocketing, our vehicles break down at the worst times, and we waste hours on paperwork!” This is a common complaint among French businesses. Yet, optimized fleet management can generate up to 30% savings on your transport budget.

With rising energy costs, new environmental regulations, and evolving work models, rethinking fleet strategy is now essential. Companies that embrace this shift quickly realize it’s not just about cutting costs—it’s about transforming their entire approach to professional mobility for greater efficiency, safety, and performance.

Why optimize your vehicle fleet?

Fleet optimization isn’t just about cost reduction. It’s a strategic response to major challenges: rising fuel prices, stricter environmental constraints, low-emission zones (LEZ), CSRD requirements on carbon footprint, and the need to digitize vehicle management for better responsiveness.

A well-managed fleet enables savings, better resource allocation, improved employee safety, and reduced environmental impact from business travel.

Key terms to know

Before diving into optimization strategies, it’s important to understand the specialized vocabulary of fleet management. This helps improve communication with providers and supports better decision-making.

• TCO (Total Cost of Ownership): The full cost of owning a vehicle, including purchase, fuel, maintenance, insurance, taxes, and depreciation.

• Car Policy: Internal document outlining rules for vehicle allocation, use, and management based on objective criteria.

• LLD (Long-Term Leasing): All-inclusive contract covering vehicle, maintenance, insurance, and services over 2–5 years, without purchase option.

• LOA (Lease with Purchase Option): Financing option allowing vehicle purchase at the end of the contract for its residual value.

• Fleet Management: End-to-end management of a vehicle fleet, from acquisition to disposal, covering all operational and financial aspects.

Fleet optimization fundamentals

Modern fleet optimization goes beyond negotiating purchase prices. It involves a comprehensive approach starting with TCO analysis, followed by a coherent car policy, and supported by digital tools for real-time fleet management.

Success relies on eight complementary pillars:

Mastering TCO: the foundation of optimization

TCO includes all costs related to owning and operating a professional vehicle over its lifespan. Direct costs make up about 80% of total TCO:

• Depreciation/Leasing: 35–45%

• Fuel/Energy: 25–35%

• Maintenance/Repairs: 10–15%

• Insurance: 8–12%

• Tires: 3–5%

Indirect costs account for 20%:

• Corporate Vehicle Tax (TVS): 2–8%

• Administrative management: 2–4%

• Downtime due to accidents: 1–3%

In 2025, taxes and social charges represent 28% of TCO for combustion vehicles—second only to financing (45.1%)—a 98% increase from the previous year due to stricter automotive taxation.

This analysis often reveals unexpected opportunities. For example, a service company thought it was saving money by keeping vehicles for eight years instead of four. TCO analysis showed maintenance costs skyrocketed after year five, canceling any savings. Conversely, an electric vehicle, though more expensive upfront, proved highly cost-effective over four years due to lower operating costs and tax benefits.

2025 data that changes everything

The 2025 TCO Scope from Arval Mobility Observatory highlights major shifts in fleet costs:

• 20.8% of passenger cars and 9% of light commercial EVs are now fleet-registered (vs. 13.9% and 8% in 2024)

• Driven by the new Annual Incentive Tax (TAI), replacing LOM quotas

Average cost per kilometer (source: Arval Mobility Observatory 2025):

• Combustion passenger cars: €0.476/km (+28% vs. 2024)

• Electric passenger cars: €0.423/km (+12% vs. 2024)

• 11% cost advantage for EVs despite higher list prices

TCO Scope 2025 results:

• EVs win 12 out of 13 passenger car comparisons

• Only 1 win out of 6 for electric LCVs (Renault Trafic e-Tech)

• EVs become cost-effective from 80,000–100,000 km for most passenger vehicles

Financing strategies: choosing the right option

Financing choice directly impacts fleet cost and management complexity. Each option has specific advantages depending on company size, financial situation, and strategic goals.

2025 Tax Focus: According to the February 25, 2025 decree, the reform of Benefits in Kind (BiK) revolutionizes cost calculations. EVs with ADEME eco-score get a 70% BiK reduction, up to €4,582/year—valid until 2027—boosting EV appeal for businesses.

LLD is now the preferred option for most French companies, offering fixed monthly payments with full service coverage and outsourced management. LOA suits companies wanting the option to buy vehicles, especially specialized models. Cash purchase benefits firms with strong liquidity aiming to minimize TCO, though it requires complex internal management.

The digital revolution in fleet management

Digital transformation brings real-time visibility, control, and optimization to fleet management. Modern solutions integrate onboard telematics, AI, and intuitive interfaces to turn data into actionable insights.

Telematics is the cornerstone—small connected devices continuously collect data on location, driving behavior, fuel use, and vehicle condition. Real-time dashboards enable precise performance tracking. Fleet systems reduce fuel costs by 12%, maintenance expenses by 25%, and admin time by 80%, according to industry studies.

Driving behavior analysis yields immediate savings. Detecting harsh acceleration, emergency braking, and speeding enables personalized coaching. Some fleet managers discover their teams spend 20% of their time in traffic—route optimization saves up to two hours per vehicle per day, equivalent to adding a staff member at no extra cost.

Predictive maintenance is a game-changer—analyzing vehicle data to send alerts 15 days before likely breakdowns, reducing unplanned downtime by 25% and extending component life.

Eco-driving training: the most profitable investment

Eco-driving training is the most cost-effective fleet optimization investment. Benefits are immediate, measurable, and long-lasting, with ROI typically under six months. It transforms driving habits to cut costs and improve safety.

Eco-driving principles focus on anticipation, smooth driving, and engine efficiency. Anticipating traffic avoids unnecessary braking and acceleration, maintaining steady speed improves fuel use, and proper equipment use reduces engine strain. Effective programs combine theory, real-world practice, and personalized coaching via telematics.

Sales teams initially reluctant to “waste time” on training often see 12% fuel savings. The most aggressive drivers sometimes become top performers, saving up to €200/month in fuel. Benefits go beyond fuel: 10–15% consumption reduction, 20% less tire wear, 30% lower brake costs, and improved road safety.

Electrification: an economic opportunity

Fleet electrification is a major optimization lever in 2025, supported by attractive incentives and operational benefits. A methodical approach maximizes gains while managing EV-specific constraints.

Public incentives include up to €5,000 ecological bonus, TVS exemption for clean vehicles, and 40% tax over-depreciation. Combined energy and maintenance costs are 60% lower than combustion equivalents. Some companies report €350/month savings per vehicle after electrifying their executive fleet.

Success depends on usage analysis. Vehicles driving under 200 km/day with regular return to base are ideal candidates. Charging infrastructure is key, with public aid often covering 50% of investment. Driver support eases adoption through EV training and addressing technical concerns.

Managing performance with the right KPIs

Effective fleet management relies on actionable KPIs. These indicators turn data into strategic insights and measure optimization success.

• Cost per kilometer: the key metric for comparisons over time and across vehicles

• Cost evolution by category: identifies budget overruns in fuel, maintenance, or insurance

• Vehicle availability rate: measures downtime impact and preventive maintenance efficiency

• Operational indicators: average consumption per 100 km, usage rate, accident rate

• Environmental indicators: CO₂ emissions per km, share of clean vehicles, carbon footprint trends

These KPIs support CSR goals and regulatory compliance, while guiding future investments.

The 2025 economic equation: EVs take the lead

2025 data confirms a historic shift: for the first time, EVs are consistently more cost-effective than combustion cars. With an 11% usage cost advantage and profitability from 80,000 km, EVs are now an economic no-brainer.

Three key factors drive this shift:

• Heavier taxation penalizing combustion (28% of TCO)

• Strengthened tax benefits for eco-scored EVs

• Lower relative EV operating costs despite rising prices

For fleet managers, 2025 marks the definitive pivot to electrifying passenger vehicles, while LCVs still require a more nuanced approach.

Your optimization roadmap

Successful companies follow a methodical approach:

• Measure before acting: Analyze current TCO and audit actual vehicle usage

• Digitize processes: Deploy fleet management and telematics tools for operational efficiency

• Train your teams: Invest in eco-driving to cut consumption and accidents

• Anticipate changes: Prepare for electrification and new mobility regulations

• Build gradually: Start with concrete actions (audit, quick wins) before full strategy rollout

• Track results: Monitor KPIs (costs, CO₂, satisfaction) to continuously refine your approach

Any company can implement these steps, regardless of size or industry. The key takeaway: fleet optimization is a marathon—not about how you start, but about consistency and perseverance.

Written by Nicolas – Electric mobility expert at Electra