Fleet News

RV chaos hits Hyundai daily rental bid

TUMBLING residual values have forced Hyundai out of the daily rental sector in the UK, the manufacturer has revealed. The decision means the company's commercial sales manager Ian White, who managed Hyundai's account with Avis, has left the company.

Although the importer recognises that supplying fleets to daily rental firms gets its cars on the road and potential new customers behind the wheel, it said residual values had become 'too high a risk'. Hyundai UK managing director David Walker said: 'We did rental business involving about 3,000 cars on a buy-back arrangement with Avis, but this year we have been forced to end it. Residual values have become too risky and it's a risk we are not prepared to take. If we can get some sensibility in residuals in the future we could re-enter on a small scale.'

He said the company would re-focus its efforts from the rental sector to dealerships in a bid to attract more customers. Walker said the manufacturer would concentrate its efforts on the user-chooser segment. 'I'm encouraging our dealer network to go knocking on the doors of small businesses on industrial estates. It's a badge issue and we want to target companies who order, perhaps, four or five cars and where drivers want value for money and are not so badge-conscious.'

Walker said the van sales force would also play a major role in this strategy. 'If companies buy one of our vans and like it, then why wouldn't they want to buy one of our cars?' he said. Hyundai sold more than 26,000 cars in the UK last year and the company is aiming for sales of 30,000 this year and ultimately 40,000 per annum. He expects the Elantra and the new Sonata, launched later this year, to play a major role.

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