Choice of vehicle supplier for the pan-European fleet is wider than it has ever been. Essentially there are three groups seeking to provide vehicles for the fleet operator.
The choice is there in the marketplace, whether an operator seeks a handful of cars in two or three markets or large numbers right the way across the European Union, and the final choice lies with the fleet operator. What level of co-ordination, commonisation and support services in terms of management information, documentation - whether paper or electronic - does that operator require? The provision of such services has a cost, and that cost is built into any contract agreement.
It is therefore important that the potential pan-European fleet operator determines well in advance exactly what he or she requires from their vehicle provider - and whether they indeed need a single, consistent, pan-European vehicle provider.
Is there a real benefit in having a common provider at this stage of development? While a common policy and common management information may be good for an executive's ego, can the full range of management information potentially available really be used to manage costs and business efficiency - or would it simply be stored 'for use in the future'?
The traditional dealer is, at first glance, the organisation with the most to lose through such a strategic review of potential suppliers. Will it be able to acquire vehicles in other countries, or will it be restricted through some manufacturer protocol?
A simple introduction through a dealer to a colleague in a different country - or countries - may result in an introductory commission, the pan-European fleet operator in turn gets a degree of added security to his business. But will the dealer be able to handle service requirements for vehicles in other countries beyond the base market - or will the fleet operator have to do that themselves?
Some pan-European dealer groups are developing. Equally, the entrepreneurial dealer may well form a strategic alliance with dealers elsewhere in Europe. The rapid growth in outsourcing companies may well offer the opportunity for dealers to provide services for vehicles they have arranged in distant markets.
Pan-European leasing companies are developing rapidly and most of the major companies have alliances, associates or sister companies in many parts of Europe. These are typically able to offer common management information across the region, although one must always be fully aware of the different pricing levels in the different markets when one comes to compare costs.
Manufacturers' captive leasing companies capable of operating on a pan-European basis are still a developing phenomenon. Many of those captives are, in reality, joint ventures. In some cases there are different joint venture parties in different countries - and that can create problems of consistency in reporting and availability of information, once one has overcome the issues of vehicle provision.
Of course, once a strategic benefit has been calculated, there may well be a case for presenting the equation to the manufacturer or importer and asking for a pan-European deal, basing the figures to be negotiated on one of the lower cost markets. Strategically, it would be logical to expect car prices across the EU to converge; and the pressures are already mounting.
Careful analysis of the situation can point the pan-European operator in the direction of an advantageous car price for Europe. It is then up to you to utilise that information to negotiate the best deal with the manufacturer, leasing company or fleet dealer. nProfessor Peter Cooke is head of the Centre for Automotive Industries Management at Nottingham Trent University – email@example.com (August 2000)