Public Services > Central Government

MoD picks Babcock to upgrade Phoenix fleet management system

David Bicknell Published 03 May 2016

Contract, worth £47m, intended to deliver £100m savings over six-year period


The Ministry of Defence (MoD) has picked Babcock as winner of a £47m contract to manage a fleet of cars, vans, trucks and specialist vehicles on its behalf, covering the UK and Northern Europe, as well as short-term hire around the world.

The Defence Equipment & Support (DE&S) arm of the Ministry of Defence (MoD) originally issued a tender for a framework contract for a real-time passenger information system last September with the six-year Phoenix II contract intended to be an upgrade of the existing Project Phoenix system.

The original Project Phoenix was forecast to deliver £43.6m of savings over its four year duration, with additional benefits gained through the aid of telemetry, an intelligent booking service and improved scheduling of assets against demand to enable the current fleet to reduce in size over the next few years, further reducing costs. An eAuction programme is said to have saved over £1m on replacement vehicles.

The new Babcock deal is intended to help deliver savings of £100m over the six-year life of the contract for vehicle hiring and leasing. The initial service is planned to start in September this year, followed by services in Northern Ireland in October and the rest of the world planned for April 2017.

The contract will cover a requirement for an information system for booking and management information, as well as optimisation and scheduling, maintenance, repair, registration, taxation and insurance, telematics, and safety management.

The MoD said the contract offers an opportunity to trigger a change in culture with greater use of scheduled transport services and vehicle sharing. The Army, the MoD's largest user of fleet vehicles, is currently using a car pooling hub at Aldershot.

Defence secretary Michael Fallon said: "Defence has the strongest incentive to be efficient. Every pound that we save on vehicle hire will be reinvested into a defence budget that keeps Britain safe. I want to see us meet and exceed the £100m target."

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