Mar. 9—GOSHEN — In the business of government, few things are more important for any municipality than having a well-maintained fleet of vehicles.

However, supply chain issues stemming from the COVID-19 pandemic have changed things — possibly for good.

Chief Virgil Sharp of the Milford Fire Department said Feb. 24 that pricing out is the biggest supply chain issue his department is facing with respects to its fleet, not availability of vehicles. Specifically, this refers to preordered vehicles which increase in cost during their delivery period.

For example — a truck ordered a year in advance may see an increase of 20%, between when it was budgeted and ordered and when it arrives. The municipality which placed the order would have to cover that extra cost as well.

“It really makes budgets tight and tough to work with,” Sharp said. “They usually don’t know what the price increase is until the next year.”

Sharp said the wait time of even two to three years in of itself is manageable, and that things have cooled down a bit at present, but the chance of such an increase is always there.

“With fire trucks it’s going to make things very difficult in the future,” he said.

Goshen Fire Department Chief Dan Sink said that it’s not uncommon now for his department to have to wait on parts which they didn’t have to pre COVID — and price increases for fire trucks and ambulances have been “astronomical.”

“We’re talking $850,000 to $1 million for an engine, for a custom truck built specifically for any community,” Sink said.

For ambulances, one which cost $285,000 to $295,000 pre-COVID now can run $400,000 to $450,000.

“We have backup units, so we’re very fortunate,” Sink added. “There are other communities that don’t have that capacity.”

Nationally, the pandemic’s impact on motor vehicle sector supply chains became clear fairly early on, at the highest federal level.

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“Supply-chain disruptions are also having a material impact on consumer prices, especially in the motor vehicle sector,” the White House said in a June 17, 2021 statement. “Over half of the May increase in core inflation as measured by the Consumer Price Index comes from this sector, if we include prices of new, used, leased, and rental automobiles. This sector also accounted for one-third of the economy-wide increase in prices compared to a year ago.”

Richard Aguirre, Goshen’s clerk-treasurer, noted that most people know that because of a series of complex issues, it’s getting more difficult and expensive to buy a new or used vehicle and more expensive to get one repaired.

“Try doing that if you’re an organization as big as the city of Goshen,” Aguirre said by email. “The city needs a variety of well-maintained and often specialized vehicles and they must be available 24/7 to serve the public. Getting those vehicles has become more difficult in recent years because of supply chain issues that worsened significantly during the COVID-19 pandemic. Many people assumed or hoped that supply chain issues would ease after the pandemic. Unfortunately, they have not.”

Aguirre mentioned that he was recently told by a city department head that the city wants to purchase five Chevrolet Tahoe SUVs in the coming year (2024).

“The local dealership told the fleet manager that Chevrolet plans to allocate 500 Tahoes to the entire region, but the dealership has orders for 650, including five for the city,” he said. “The dealer told the Goshen fleet manager it will only get 125 Tahoes, next year which likely means the city won’t get its five. Most of the 125 the dealership’s Tahoes will likely go to customers who place larger orders.”

Aguirre said the city is having to keep vehicles in service for longer periods than in the past because it can’t buy timely replacements — and when it does they are more expensive.

“In one case, it took two years to get a dump truck,” he said. “About the same for a much-needed ambulance that recently arrived. The fleet manager told me that a city vehicle was just totaled because of an accident (these things happen). But because he can’t buy a replacement, the fleet manager is having to replace the totaled vehicle with a ‘pool’ vehicle that is older and will need to be kept in service longer.”

Per city policy, Goshen’s Central Garage has been makes sure all that snow removal vehicles and equipment is ready to respond to emergencies, especially prior to the onset of winter weather.

“Besides that annual responsibility, the Central Garage gives its highest priority to maintaining police and fire vehicles,” Aguirre said. “At any given time, one or more of those vehicles are being serviced or repaired. It’s a business necessity to adapt to changing circumstances, and that’s what the city of Goshen has done. The city is maintaining its fleet the best it can, keeping vehicles in service for as long as possible, expediting repairs and searching far and wide to buy replacement vehicles.

“At times, our fleet manager has been successful at finding vehicles at a good price because he is checking beyond local suppliers. But that’s a hit-or-miss proposition and meanwhile the vehicle needs continue to multiply.”

Eric Eby is vice president of Eby Ford Lincoln in Goshen.

“We have sold vehicles to Goshen, Elkhart and many other municipalities throughout the country through their respective bid processes,” Eby said by email. “When we respond to a bid from any municipality we are always priced as competitively as possible. It’s a way for us to show support for the community that has supported us for over 70 years.”

Eby concurred that the COVID-19 pandemic was a disruption to the entire automotive industry.

“Vehicle lead times increased significantly,” he said. “Our typical 12-week lead time turned into 30 to 52-plus weeks. That type of variability strains all parties involved. We experienced shortages across the board. We had half of the vehicle inventory that we typically had available to sell. We had to wait weeks to get parts to repair customer vehicles in our Service Department.

“Our Collision Center (which opened its doors in March of 2020) had to overcome parts backorders as well. We are lucky to have the team that we do, we adapted very well to the challenges that the pandemic presented us with.”

Although there are still lingering effects from the pandemic, Eby said that overall things have improved significantly.

“Vehicle and parts availability has increased however it seems that the logistics industry has recently become impacted,” he said. “For example, there are instances where a vehicle has been built at Ford and will sit at the plant for several weeks, possibly more than a month, waiting for a transport truck to pick it up and deliver it here. We’ve also recently had the same issue with parts to repair customer vehicles. The part we need might be available, but there may not be enough workers at the packaging plant to get it boxed and shipped to us.

“If there are enough workers at the packaging plant, there may be a shortage of truck drivers to deliver the parts to us. Again, we are lucky to have the team that we have here. Our employees are all inspired and motivated to adapt and find a way to take care of our customers. In the part scenario, we may search another dealership’s parts inventory and source the part that way instead of waiting on the component from the packager.”

Eby expressed his appreciation for his colleagues in his industry.

“I can’t say enough about the incredible people that work for our company,” he added. “When the pandemic started, and everyone’s lives were upside down, we came together and navigated through the chaos. I was having a conversation with someone else in the automotive industry during that time, who was concerned about what the impact might be to dealerships long term.

“My perspective was, and still is, that the pandemic would separate the dealerships in the industry. When the industry was so significantly disrupted, I believe true colors started to show across the country. Dealerships that chose profit over relationships were easily identified. We made the choice, as we always have, to stay true to who we are. We didn’t charge any kind of ‘market adjustment’, didn’t install accessories that the customer didn’t want, or play any of the pricing games that were found elsewhere. We chose to be honest and transparent, and I’m profoundly proud of that.”

Hannah Scott-Carter, Community Relations manager for the city of Goshen, said the city’s central garage works with various dealerships in the area to ensure they can place orders for needed vehicles.

“Because of supply chain issues, the city has had to work with more dealerships but has found dealers have made adjustments to their allocations, so the city has been able to place orders for new vehicles, Scott-Carter said by email. “Most recently, five new patrol vehicles were ordered.”

She said that the the city always tries to prioritize first responder vehicles, but there are times when other departments’ vehicles, like the Street Department’s snow removal equipment, take priority, especially during snow events.

“In the last couple of months, the city’s Central Garage has noticed supply chain issues leveling out and parts more readily available,” she added. “The Central Garage utilizes Indiana’s Quantity Purchase program whenever possible, as it streamlines the process. However, not every item may be available through a QPA.”

Hunter Petroviak is Public Relations director for the Indiana Department of Transportation’s Northeast District, which includes Elkhart County.

“Just like everybody else, INDOT has experienced delays in receiving new vehicles for a number of reasons,” Petroviak said by email. “Rather than shift suppliers, INDOT adapted to the mindset of enhanced preservation of our equipment by making it stronger and more durable through extensive care and becoming more frugal with the materials we have.

“As we continue to adapt to market conditions, including more available vehicles, we’re taking a pragmatic approach of enhanced preservation of our fleet to maintain what we have and the new vehicles we receive.”