Fleet News

Independents battle for survival

DEALER-based and independent contract hire firms are facing a battle for survival amid increasingly tough market conditions. Colin Tourick, managing director of Associates Fleet Services, said factors such as low sale margins and competition from European imports were making it hard for firms to compete against their manufacturer and bank-owned competitors.

He told a Fleet Show 2000 forum on the impact of consolidation within the contract hire market: 'Low sale margins, price issues, European imports and the pressure of having to find large sums of money to expand territories or develop their sites means there's a real chance their rates will rise and service standards fall.' For the independents, he said their future depended on funding arrangements, their client base and balance sheet.

They and the dealers are up against manufacturer-owned contract hire and leasing companies which will see the benefits of their investment as they push their own cars with special deals and bonuses and use their contract hire companies to market cars. 'Bank-owned contract hire will try and sell you additional services,' said Tourick. 'They will have to do that because of the price they're paying to buy a place in the market. They need additional income streams.'

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