Royal & SunAlliance's experience of global procurement arrangements for other products and services suggests savings of between 10% and 40% are achievable in administration and acquisition costs, and financial savings were one of the key drivers of the new three-year agreement with GM. The other key driver was the group's determination to adopt a global focus, a strategy explicitly identified by Bob Mendelsohn, Royal & SunAlliance's group chief executive, in the company's last annual report, when he said: 'For some years we have been actively changing the culture - replacing the historic UK centric view of the world with a global perspective.'
GM was already well represented on Royal & Sun Alliance's fleet, particularly in its five key operations in the UK, United States, Canada, Australia and Scandinavia, and as these adopt the new solus arrangement GM's share of the total fleet will approach 90%. Mike Bonner, Vauxhall's corporate sales director, said the new deal bore testament to GM's commitment to global customers. 'The GM Global Fleet Strategy Board was set up 18 months ago, and we are now talking to a lot of major companies. I expect to see more and more committing to global and pan-European supply agreements in the next 12 months,' he said.