Frequently Asked Questions

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  • Total Cost Of Ownership (5)
How to reduce total cost of ownership?

There are many ways to reduce fleet total cost of ownership. First and foremost, fleet managers should focus on effectively tracking TCO variables such as downtime, maintenance and repair needs, as well as operating costs. As a result of accurate tracking, fleet managers can reduce TCO using the detailed information provided.

In general, some of the most effective ways to reduce total cost of ownership include:

  • Acquiring the right vehicles for your business and industry
  • Implementing new technology that will assist in reducing day-to-day operating expenses
  • Investing in eco-friendly vehicles
  • Performing preventative maintenance on fleet vehicles
  • Replacing older fleet vehicles before resale value and maintenance costs are significantly impacted by the vehicle’s age
Why is TCO important?

TCO is important to calculate because it helps fleet managers and owners better manage their fleet. Fleet total cost of ownership demonstrates the true costs of owning and operating a fleet. Therefore, using this information, fleet managers and owners can track costs and determine how to optimize fleet performance to maximize their return on investment. Fleet total cost of ownership can also help fleet managers recognize and address safety-related issues and identify how new technology can assist with fleet management. Most importantly, TCO can help with important financial and business decisions. 

For example, accurate TCO figures can assist with detailed financial reporting, decisions about when to replace fleet vehicles, maximizing profitability and ROI, and monitoring vehicle and driver performance.

What voids a Kia warranty?

Modifications which cause your vehicle to deviate from the manufacturer’s original specifications may void certain parts of the Kia warranty. Damage or failures caused by lack of proper maintenance are not covered under warranty.

What is total cost of ownership?

Total cost of ownership refers to the total cost of purchasing and operating a vehicle. This includes all costs associated with the vehicle for the length of ownership.

While total cost of ownership commonly relates to the costs associated with a single vehicle, fleet total cost of ownership refers to the cost of purchasing and operating an entire fleet.

There are many components of fleet total cost of ownership. In general, it includes the purchase price, as well as the costs to operate and maintain fleet vehicles. Many fleet managers also consider downtime as an expense. 

Fleet total cost of ownership is often referred to as TCO or fleet management costs.

What is the bumper to bumper warranty on a Kia?

Kia offers a 5-year/100,000 km worry-free comprehensive warranty covering virtually the entire vehicle.

What does a Kia warranty cover?

Every Kia comes with a 5-year (100,000km) Comprehensive Warranty, as well as New Vehicle Limited Warranty, Powertrain Warranty, Limited Warranty Covering Perforation from Corrosion, and Emission Control System Warranty.

What are the components of total cost of ownership?

There are several key components to total cost of ownership. Some of the most important fleet TCO components include:

  • Acquisition Costs - this includes the purchase price of the vehicle, supplier margin, costs to operate the purchasing department, transport and delivery charges, packaging, customs duties, and any associated financing costs.
    
  • Operating Expenses - operating expenses include the cost of operating fleet vehicles. For example, stock management, depreciation costs, fuel, taxes, insurance, administrative costs, etc.
    
  • Repair and Maintenance Costs - this includes all the costs associated with keeping fleet vehicles in good working condition. Fleet maintenance and repair costs may include the cost of new tires and brakes, oil changes, and preventative maintenance work.
    
  • Resale Value - the amount that the vehicle (or fleet) will be sold for when it is retired should also be accounted for in TCO.
    
  • Downtime - when a vehicle is not on the road, it is not providing value. This opportunity cost, or the amount of revenue and goodwill that is lost as a result of downtime, should be considered by fleet managers as a cost to the business.
How do you calculate total cost of ownership?

To calculate total cost of ownership, many fleet managers and owners can use the following TCO formula:

Individual Total Cost of Ownership = Acquisition Costs + Operating Expenses + Maintenance Costs [+ Downtime Costs*] - Resale Value

This formula will provide the TCO for a single vehicle in your fleet. To find fleet total cost of ownership, simply add the TCO for each vehicle in your fleet together.

Please keep in mind that this formula may not be the same for fleets in all industries. It is important to consider the costs associated with your specific industry and fleet in order to arrive at an accurate TCO calculation.

Does Kia’s warranty cover tires?

The tire manufacturer warrants the tires on your Kia vehicle. Please contact your specific tire manufacturer for warranty information.

Can you transfer a Kia warranty?

Each coverage period begins on the date of retail delivery to the first purchaser or the date the Kia vehicle is first placed into service. Any remaining portion of the warranty is fully transferable to subsequent owners.

Can you extend a Kia warranty?

Kia offers a range of extended warranties.

Are used vehicles still covered under factory warranty?

Yes, the Factory Warranties remain where vehicles are inside the mileage and duration caps. This includes fleet and commercial vehicles.

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