Super Group seeks more Jo`burg business
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Trade and Industry Editor
TRANSPORT and logistics company Super Group wants to secure a second vehicle fleet outsourcing contract with Johannesburg, with the current deal proving lucrative for both parties.
The city council yesterday said the move to outsource its fleet to Super Group`s FleetAfrica in February 2001 had saved ratepayers about R357m to date.
The council calculated the saving by subtracting the actual cost from the council`s projected annual vehicle fleet cost of R480m a year over the past three years, compliance manager at the council Ian Davies said yesterday.
The council`s 2004 annual report also indicates significant improvements in vehicle availability, as well as a substantial reduction in the size of the fleet.
`Before the city outsourced its fleet services, there was an estimated 40% availability of vehicles,` Davies said.
`The outsourcing contract ... has managed to raise availability to 98%.`
The current five-year contract was worth R2,4bn to the transport company, and includes the replacement of all of the council`s vehicles. Davies said about 3500 vehicles have been replaced to date, with a small number of replacements outstanding.
Johannesburg was the first municipal operation to outsource its fleet. The results of the move have generated interest from other local and national governmental departments, said Davies.
`Initially, outsourcing was considered a big risk but it is now a success story,` said Davies.
He said the council recently closed its call for expressions of interest in a similar contract to commence when the current deal expired at the beginning of 2006, and Super Group was among the parties that expressed interest.
Super Group`s chances of securing a new contract with the council are likely to be improved following its recent empowerment deal.
In terms of the deal, Peu Investment Group, together with previously disadvantaged employees of the transport group, will acquire an equity holding of 25,1% of Super Group.
Jul 28 2004 07:23:22:000AM Carli Lourens Business Day 1st Edition
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