Fleet News

Early termination -talk, not technology

A BID to launch an internet trading scheme for early termination vehicles has failed to take off as fleet managers were told it is talking, not technology, which will cut their costs. It was hoped fleets could save thousands of pounds in early termination costs using a trading scheme through which fleets would offer vehicles to other ACFO members instead of paying their contract hire company an early termination charge.

Mike Bray, country transport manager for East Sussex County Council, who suggested the scheme at the Association of Car Fleet Operators southern region meeting, felt fleets could save thousands of pounds in penalties for handing vehicles back early. But Jeremy Davis, national sales manager for PHH Vehicle Management, said there was a more simple solution.

He said: 'If a fleet hands a contact hire vehicle on to another firm, it will still be responsible for the lease and upkeep of the vehicle, so there are considerable issues there. But we sell a variety of leasing products and cover the costs of terminating a vehicle and providing it to someone else within the rental. The difference between a basic product and one that includes this is just a few pounds a month.

'But some fleets just focus on price. I once lost a vehicle contract over 6p. If you are more expensive, no matter what the service, then you lose the contract. If you really want to make things easier, there is a price to pay for it. However, if I have a fleet come and talk to me sensibly and there is a likelihood of a long-term partnership, then I might take some early terminations as goodwill. Fleets have to decide if they want low rentals or overall flexibility.'

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