Oklahoma City, the state’s capital and largest metro area, has seen expanding industry and infrastructure improvements positioning it as an opportune place to launch a new automotive fleet operation by 2024. While not without challenges, Oklahoma City offers several advantages making it a viable market for an entrepreneur looking to build and grow a fleet services business.
The Case for Oklahoma City
With a 2024 projected population of over 1.4 million, Oklahoma City offers a sizeable customer base for fleet services. Major investments to the city’s airport, roads, and infrastructure along with growth in sectors like energy, aerospace, and healthcare point to economic vitality. This spells opportunity for providing transportation to emerging businesses. Additionally, the city’s central location provides easy access to connect customers across the state and Southern Plains region. Situated right off I-40 and I-35 means ready transportation routes through the area and to supply channels like regional car auctions OKC.
In addition to its organic growth, Oklahoma City is likely to see continued investment and business expansion based on several factors. As a hub for the energy industry including oil and gas along with renewable wind power, Oklahoma City stands to benefit as demand grows for energy and greener technologies. The city has worked diligently to diversify its economy beyond just oil and gas, attracting industries like aerospace, communications, life sciences, data, and transportation. This broader business foundation will aid the metro’s growth.
Major companies headquartered in Oklahoma City or with significant regional operations represent potential fleet customers. These include corporations like Chesapeake Energy, Devon Energy, OGE Energy, SandRidge Energy, Paycom, Sonic Corp. and others. Supporting this business ecosystem requires transportation and distribution services that a fleet startup could tap into.
Factors Favoring a Fleet Startup
Several dynamics make Oklahoma City an advantageous environment for launching a new fleet operation including:
- Low costs – Operating costs including taxes, labor, and facilities are very affordable compared to other metro regions. This helps offset other costs like vehicle acquisition.
- Limited competition – Not being one of the top 20 metro areas means less competition from established national fleet companies. Easier to gain market share.
- Strong workforce – Good availability of technically skilled mechanics and drivers as workforce base to staff a growing operation.
- Business incentives – Oklahoma offers multiple tax credits and incentives for transportation and high tech startups. Can improve margins.
- Central location – Easy access to connect customers and vehicles across OK, TX, KS, AR and beyond.
Potential Hurdles to Clear
Of course, Oklahoma City poses some challenges that a fleet startup should anticipate and prepare to address including:
- Limited public transit – Could hamper getting employees to/from work. May need to provide transportation.
- Significant weather variations – Severe cold, heat and storms may strain fleet vehicles and disrupt operations.
- Congestion issues – OKC road infrastructure struggling to keep up with rapid growth. Can affect fleet efficiency.
- Tight lending – Banks in OKC remain conservative, making acquiring startup capital more difficult. Need strong business plan.
While rapid expansion has put pressure on infrastructure, Oklahoma City has major highway and road projects underway that are adding capacity. The city has passed large funding packages to improve public transportation as well with plans to add bus rapid transit lines. Though congestion may hinder efficiency initially, the long term infrastructure additions will mitigate this.
Regional vulnerabilities to severe weather events do pose challenges. However, fleet telematics and tracking systems can help minimize disruptions by redirecting vehicles based on real-time conditions. The startup may need to budget for more warehousing/parking facilities to store portions of the fleet during extreme weather until conditions improve.
Keys to Success for a Fleet in Oklahoma City
To overcome the market challenges, there are several strategies a new fleet business can employ:
- Bootstrap the early fleet by acquiring good-value used vehicles from area auctions like those in Choctaw. As revenue comes in, invest in newer vehicles.
- Start with a niche – Focus the early fleet on a specific industry like medical transportation or construction to establish a customer base. Broaden from there.
- Invest in technology – Use telematics, scheduling software and other tech to maximize fleet efficiency and safety. This helps attract customers.
- Differentiate your services – Offer specialized equipment, dedicated drivers, extensive vehicle options and other value-adds competitors lack.
- Leverage state/local resources – Tap into workforce training programs, tax credits and other resources to defray costs.
Forming partnerships with technical colleges and workforce boards can provide a pipeline of qualified, affordable mechanics and drivers. This avoids having to compete for talent. Work opportunity tax credits offer thousands in offsets for hiring from certain demographics like veterans.
Phasing growth along with demand and infrastructure development will be key as well. Starting operation from a central hub terminal and expanding to satellite locations around OKC and statewide allows scaling strategically.
Sourcing Vehicles Strategically
Acquiring vehicles at significant cost savings will be essential for strong margins. Sourcing cars, vans, and light trucks from Oklahoma City area auctions provides quality inventory at below-retail prices. Channels like the car auctions OKC from AutoBidMaster provide weekly chances to bid on a wide range of fleet vehicles.
Focusing on 1-3 year old, low mileage models allows getting near-new assets at used pricing. Maintaining a targeted mix of vehicle types and avoiding aging assets will keep maintenance costs contained. Utilizing fleet management software assists in benchmarking performance by vehicle make/model to optimize selection.
Conclusion: Oklahoma City Presents Solid Opportunity in 2024
For the entrepreneur willing to implement the best practices, Oklahoma City offers very favorable conditions for successfully starting and growing an automotive fleet business by 2024. The market dynamics combined with a smart and lean operating approach can readily lead to a sustainable venture within 2-3 years. Keeping on top of infrastructure improvements, diversifying services, controlling fleet costs, and leveraging state/local resources will position a startup to thrive.