Fleet News

LeasePlan drives on into Europe

LeasePlan is targeting central Europe as part of a major growth plan for its leasing and fleet operations.

The company reorganised its international sales and account structure into four separate territories in 2000 – northern Europe, central Europe, southern Europe and North America.

The Central Europe operation is based in Germany, with responsibility for developing and managing international business opportunities across a wide range of countries, including Austria, Czech Republic, Germany, Hungary, Slovakia and Poland.

'We are seeing tremendous growth in these areas,' said Nick Salkeld, managing director of LeasePlan International. 'Our activities in Central Europe are growing well ahead of the market. Last year they grew by 37% over the previous year.

'Over 21% of managed units within the Central Europe region are with international clients, and growth in this region in the first quarter of 2002 is already 42% ahead of the equivalent period in 2001.'

Poland is the most recent addition to the company's target markets in the region. Again, much of the new business there is with international clients.

'As a new-start company, our Polish operation's sales and marketing priority has been to take maximum advantage of the group's international strength,' said Salkeld. 'Over 70% of LeasePlan Poland's new business since July 2001 has come from international clients and the potential is set to grow, with over 75% of LeasePlan International's client portfolio having a presence in Poland.'

Today LeasePlan International manages around 120,000 vehicles on behalf of over 75 international companies. In 2001 LeasePlan International's growth represented around 25% of the LeasePlan Group's total global organic growth, with incremental growth in 2001 22% ahead of 2000.

The leasing giant is benefiting from a period of stability after being taken off the market by parent company ABN AMRO at the end of last year. Earlier in the year ABN AMRO wanted to sell off LeasePlan as part of a move to focus on its core banking activities.

However, the business continued to make healthy profits, and it was well positioned to take advantage of the growth in large-scale fleet deals.

'The trend towards globalisation amongst multinationals has created rapid demand over the last five years from companies looking for global fleet management solutions,' said Salkeld. 'LeasePlan International was specifically established by the LeasePlan Group to develop direct relationships with international prospects and customers, and to maximise the sales potential from LeasePlan's global coverage.

'The group's strategy has been to strengthen LeasePlan's capabilities to serve all international customers by developing a distinct and clear marketing message, and by delivering an effective organisation for serving international customers. We want to be recognised as both the market leader and the best provider of global vehicle management solutions.'

Central Europe continues to benefit from massive investment from western European and America companies, with Poland and the Czech Republic leading the way. The motor industry itself is among the biggest investors, as it seeks to avoid the high labour rates associated with western Europe.

Daewoo and Fiat have spent hundreds of millions of pounds on their Polish factories, while the Volkswagen Group is a major investor in the Czech Republic and Hungary. Volkswagen is the biggest seller in central Europe, and has been since 1996.

Such multinationals are boosting demand for internationally-backed fleet services in central European markets.

Not everyone, however, finds instant success in the region - Daewoo sustained massive losses as it bid to establish itself as a major player in Poland.

Many economies in central Europe are still unpredictable, with accompanying dangers for the motor industry. It is not always easy, for example, to control residual values, as some fleet operators have found out to their cost.

Looking at used car prices of upper medium sector saloons in Poland, for example, last year Ford Mondeo values fell by almost 20% and Opel Vectra by over 11%. Yet Renault Laguna prices rose 20%.

Salkeld says it is vital to offer customers in central Europe a thorough, professional service and backup.

'Each of our regional operations has its own structure, with business development managers, and sales and marketing managers. We can also negotiate on a European level on behalf of our local clients. This was the empowerment customers wanted.

'We have to make sure we seek and act upon market and customer feedback. It was by listening to this feedback that LeasePlan International has been able to deliver a support structure that sees LeasePlan International and the LeasePlan companies working closely together to successfully deliver international programmes.

'It was also through this approach that we were able to deliver centralised and empowered account management, as well as global harmonisation in products, services and pricing. These allow us to structure cost saving programmes that add value, and to offer leading IT capabilities featuring a consolidated international reporting tool.

'We are building a team of people that we believe will enable us to remain in front of our competition. This team is backed up by 26 dedicated national co-ordinators who provide the vital link between LeasePlan International and the country operation.'

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