Tshwane saves R200m from annual vehicle leasing costs by cutting middleman

The City of Tshwane has cut its vehicle leasing costs by half by getting rid of the middleman and buying the vehicles directly.

Tshwane mayor Randall Williams says 238 newly procured fleet vehicles will reduce the city’s annual costs by more than R200m.

“By simply buying our own vehicles and not leasing them via the middleman, we have now reduced the yearly cost of our fleet from R400m to less than R200m. That’s a huge saving for the city and we will be able to use the savings to spend more on providing better service in other areas,” he said.

Williams joined the MMC for corporate and shared services, Kingsley Wakelin, on Monday to officially hand over a first batch of 100 new city-owned fleet vehicles.

Tshwane, which has experienced financial difficulties that have seen it struggle to pay service providers such as Eskom, is acquiring 280 vehicles for the 2022/2023 financial year.

Williams said the aim is to stabilise the city’s finances and cut down on expenditure “so we can plough this money back to providing core services to our communities”.

“Four years ago the city identified that it was losing a lot of money by procuring its vehicles via a middleman, so we are going to let those contracts expire,” he said.

The city was now buying its own vehicles outright, he said, part of its 2022/23 financial year budget.

The fleet includes waste collection skip loaders, waste compactors and light commercial vehicles. Williams said the city would buy more vehicles in the next financial year, with priority given to:

• the Tshwane metro police department;
• the water & sanitation department;
• the environment & agriculture management department;
• the energy & electricity department; and
• the roads & transport department.

“These vehicles will be put to use immediately to service our communities. It is important that we move away from exorbitant lease contracts that were signed and approved by past administrations.”

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