Fleet News

25th anniversary: history of Fleet News

THROUGH inflation, recession, good times and bad, Fleet News has faithfully reported the news and views of the UK fleet industry since 1978. Editor John Maslen looks back on some of the momentous events that have helped shape the current company car market.

Five years: 1978 – 1982

FLEET News arrived on the desks of fleet decision-makers for the first time and was scheduled to come out every two months.

It was launched at a time when UK inflation was running at 9.9%, Anna Ford was working as the first woman newscaster and the first test tube baby was born. Among the biggest singles of the year were Rivers of Babylon, You're the One That I Want and Summer Nights.Bread rationing was introduced after a bakers' strike led to panic buying in the shops.

The first issues arrived at a time when a gallon of four-star petrol cost 82p and the best-selling fleet car, the Ford Cortina 1600 GL, cost £3,423. Leasing one would have cost £16.38 a week on a 20,000 miles a year contract.

Among the stories covered in the launch year were that the Austin Princess would be one of the most sought-after cars in the country, challenging the number one best-seller, the Ford Cortina. In 1979, the year Margaret Thatcher came to power, Fleet News established the fleet panel, a version of which still exists today, examining key issues facing the fleet industry.

In the disposals market, a three-year-old Vauxhall Chevette, with 60,000 miles on the clock, fetched £1,150 at British Car Auctions.

Vauxhall also launched the Astra this year.

In 1980, front-wheel drive started to enter the volume car market with the Austin Metro and Ford Escort, while Vauxhall's Cavalier was given a sneak preview early in 1981 as the J-car. At the time, Fleet News asked: 'A company car for you... and for Europe?' And we declared: 'It's a winner.'

Ford hit back in 1982 with the Sierra, sporting a controversial new shape, which won both bouquets and brickbats.Some attacked it as a 'jelly-mould' while others welcomed it as the future of car design.

Fiat also looked to the future, with the promise of a rust-free car that would last 20 years. Meanwhile, four-star petrol had risen to about £1.70 a gallon.

10 years: 1983 – 1987

Safety took the headlines in 1983, as wearing front seatbelts became compulsory. The year also marked the launch of the Fleet Show at Wembley.

It was also the year that the Austin Maestro was launched, hailed to fleets as 'The car that you helped create'.

Key trends that would shape the next 20 years of the fleet industry began emerging in 1984, as it was revealed that demand for contract hire had grown by 51%.

Vauxhall saw its sales rocket from 127,141 cars in 1982 to 262,000 units in 1984 and Calor Gas claimed converting to liquefied petroleum gas could slash running costs.

Diesel sales doubled to a mere 45,386 units. Japanese manufacturers were also winning business, with plans for a Nissan plant in the UK. Fuel cards were on the agenda in 1985, when British Rail took on 20,000 for its fleet of cars and vans.

Watching fuel costs was vital as the cost of petrol broke through the £2 a gallon barrier, although it fell back later. If you wanted to keep in touch on the move, a hand portable Racal Vodafone cost £1,750 to buy.

In 1985 Fleet News hit a major milestone as it became a weekly newspaper, serving a market that was growing ever bigger. Nissan announced that fleet business was a key target for the future and in 1986 it stunned the motor industry with the introduction of a three-year warranty.

In 1987, car sales hit a record for the time of 2,013,693 units.

Fleet driver safety began its long journey to the top of the industry agenda, when motor racing legend Sir Stirling Moss attacked company car drivers for their poor driving.

He said: 'Company car drivers have less regard for road safety than people who have to pay for and insure their own vehicles.'

His comments were backed by Government ministers. Roads and traffic minister Peter Bottomley claimed that company car drivers had a worse accident record than private motorists, an argument that has continued in the industry to the present day.

15 years: 1988 – 1993

In 1988, benefit-in-kind tax for company car drivers doubled. However, fleet decision-makers could comfort themselves with the savings made from an aggressive pricing battle between key fleet manufacturers.

In 1989, Toyota opened a new manufacturing plant in the UK, while unleaded petrol was first introduced.

In another first, Vauxhall became the first major UK manufacturer to fit a catalytic converter. Into the 1990s, fleets were in no mood to celebrate, as the Budget saw a 20% increase in benefit-in-kind tax on company cars.

Petrol rose through £2 a gallon again amid the first crisis in the Gulf. During 1991, sales of catalyst-equipped cars rose to 276,000.

BMW's new 3-series saloon made its world debut at the Fleet Show, with prices starting at £14,250, while the Renault Clio also went on sale.

Chancellor of the Exchequer Norman Lamont introduced the latest tax on company cars by making them liable for National Insurance. Manufacturers said this taxation could could cost £1 billion in car sales. But in 1992, a new system for company car tax was announced, which was welcomed by fleets.

This year also marked the launch of the Institute of Car Fleet Management, dedicated to raising the professional qualifications of fleet decision-makers.

In 1993, Vauxhall launched its Nova replacement, the Corsa, and introduced airbags on its upper-medium contender, the Cavalier, just as Ford was introducing the Mondeo. Other models on the market included the Rover 600, Peugeot 306 and Citroen Xantia.

A reformed company car tax system was based on mileage bandings and 35% of the car's list price. Outsourcing became a new buzzword, with experts claiming it sounded the death knell for fleet managers.

Towards the end of 1993, the price of fuel had crept up to about £2.25 a gallon, with diesel slightly more expensive than petrol.

20 years: 1994 – 1998

Major changes loomed in the motor industry as BMW bought Rover. Other manufacturers were joining the battle for fleet business with fresh models, particularly Renault with the new Laguna.

One of the biggest environmental and health issues of the 1990s appeared, with a report claiming there were links between diesel exhaust fumes and cancer.

Ford's new Scorpio went head-to-head with the Vauxhall Omega. New manufacturers continued to carve themselves a share of the car market, with Hyundai agreeing a major deal to supply Avis with 1,400 Lantras. Added extras began to become more prevalent on cars, with the widespread introduction of air conditioning.

Vauxhall launched the new Vectra in 1995, while contract hire received a major boost when the Government allowed contract hire companies to recover VAT on cars they bought to lease to customers, significantly reducing rentals.

Daewoo concluded its first fleet deal during this year, while in 1996, Budget measures were introduced to promote cleaner fuels and Fleet NewsNet, the sister website to Fleet News, was launched.

In 1997, companies began switching to liquefied petroleum gas, compressed natural gas and electric vehicles, as attention turned to environmentally-friendly motoring. Safety was again on the agenda, with the launch of the new European New Car Assessment Programme crash tests, which are now the focus of massive investment among manufacturers to achieve the maximum five stars.

Fleet sales achieved a record 1,018,491 units as overall car sales rocketed to more than two million for the first time for nearly a decade, storing up trouble for the used car market in three years' time when oversupply would become a major issue. In 1998, the all-conquering Ford Focus was launched. It has consistently stayed at the top of the fleet sales charts ever since and this year, it is still winning Fleet News Awards.

Fuel prices were approaching £3 a gallon, but the Government pledged that the car still had a vital role in transport policy. 25 years: 1999 – 2003

THE past five years have seen more changes in the fleet industry than the previous 20 years put together. 1999 started with talks over the future of Longbridge as BMW considered the future of the ailing plant. The row overshadowed the launch of the new Rover 75. Eventually, a £180 million aid package was agreed for the plant and a new owner stepped forward.

Toyota prepared to start production of the Prius, the first of a growing number of petrol/electric hybrid vehicles which are starting to be accepted by a growing number of fleets today.

Chancellor of the Exchequer Gordon Brown announced that from 2002, company car tax would be based on a vehicle's carbon dioxide emissions, although it struggled to provide accurate data showing the correct CO2 figures for cars in time for the introduction of the tax.

Also in 1999, fleet decision-makers were urged to bombard their MPs and the Government with demands for a clear message on how the system would operate. In a controversial move, the Government announced later in the year that diesels would incur a 3% penalty – a move later amended so that vehicles achieving Euro IV emissions would be exempt from the extra charge.

In a further shake-up, Centrica announced it was buying the AA for £1.1 billion. By the end of 1999, fuel had reached between £3.42 and £3.63 a gallon. In 2000, as diesel and petrol prices neared £4 a gallon, fuel protesters blockaded refineries and brought Britain to a near standstill.

Although consumers could comfort themselves with the fact that manufacturers were committed to cutting prices on new cars, they overlooked the fact that residual values were collapsing as a result. This caused a massive shake-up in the contract hire and leasing industry, as companies set aside hundreds of millions of pounds to cover unexpected losses at disposal time. Some companies closed and others sold up. The Government outlined plans for workplace parking charges and road-user charging – a move which would eventually have its first real test in London.

Arval and PHH launched a joint venture to become Europe's largest fleet management company, but only for a short while until LeasePlan bought Dial the same year and laid claim to the crown.

A new EC report into block exemption paved the way for sweeping changes in the way cars were sold, the Supply of New Cars Order 2000, demanding dealerships have the same discounts as fleets.

To end a frantic year, Vauxhall was the focus of some of the most dramatic scenes in the motor industry as workers laid siege to its Luton headquarters to protest at plant closures.

As employers began to look more closely at pan-European buying policy, Fleet News' sister title Fleet News Europe was launched.

Into 2001, any hope of a rest was shattered as the upheaval in the fleet industry continued. A Fleet News investigation revealed a string of errors in the vital guide to all vehicle carbon-dioxide values in Britain, the key to accurately forecasting company car benefit-in-kind (BIK) tax.

Fleet discounts were once again at the heart of Government affairs, with an Office of Fair Trading investigation into whether manufacturers were selling cars to dealers at equivalent rates to those being offered to companies, as intended under the Supply of New Cars Order 2000. Lex Service, which owns RAC, bought Auto Windscreens for £112 million, heralding a shake-up in the glass repair industry.

Rental companies warned of a hike in rates as it introduced charges for services normally provided free, such as delivery and collection. Jaguar moved into a new market with the junior executive X-type, while back-from-the-brink MG Rover unveiled its new MG range.

Labour romped home to another General Election victory and was given a 10-point plan for transport change by fleets. The industry received a boost when the Treasury predicted the launch of a CO2-based BIK tax would encourage 200,000 more employees to take company cars.

It was also the year the all-new registration plate system was launched and the importance of safety was hammered home to fleets with warnings that company directors could face jail sentences for failing in their duty of care to drivers, under recommendations from the Government-backed Work-related Road Safety Task Group.

The all-new Vauxhall Vectra was revealed to fleets for the first time, while at Ford, its chief executive Jac Nasser left the company in a major management shake-up. And amid all the change, the Government tried to push fleet innovation further, with proposals that annual sales of fuel cell vehicles would reach 250,000 by 2020. However, global upheaval was the dominating factor in the industry during 2001, following the terrorist attacks on America on September 11.

In 2002, the changes continued, as Ford sold Kwik-Fit and London Mayor Ken Livingstone announced his controversial congestion charge.

CO2-based company car tax was finally introduced, speeding up an already significant rush for low emission diesel cars, despite Government concerns about the harmful effects of their emissions. Lloyds TSB autolease bought First National Vehicle Holdings, completing a meteoric rise that took it to the number one slot in the Fleet News FN50 list of the largest leasing companies in the country.

The Health and Safety Executive was raising the stakes for fleet safety by demanding to see corporate road risk policies during company safety audits.

As Trafficmaster predicted drivers would waste 1.4 million working days in traffic jams, Transport Secretary Alistair Darling revealed that fleet decision-makers and company car drivers would be in the front line of a new initiative to fight congestion. And so to 2003, which has already seen further upheaval amid a new war in Iraq, a call for a ban on the use of private cars on business, the launch of the Motor Insurance Database, the introduction of fines for 'annoying drivers' and the launch of congestion charging in London.

Added to this have been changes to vehicle taxation that meant owners can only tax a vehicle if it had a valid V5, which is having a significant effect on the vehicle disposal industry. And this month there are changes to company car tax bands, National Insurance Contributions and the taxation of free fuel for private mileage.

After 25 years of Fleet News, it seems the industry is busier than ever.

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