Fleet News

Guest opinion: flexibility and speed key to serving customers

STEVE Underwood, business development director with Hitachi Capital Vehicle Solutions, predicts a very different leasing industry by 2014.

'The challenges facing the fleet industry are mounting. At the moment we are dealing with a sea of contradictions which the industry is finding difficult to navigate.

We are not in a recession but companies are down-sizing their fleets. Company car tax continues to rise but cash-for-car schemes have not taken off in the rocket-like way expected. There is a general shift in society to more independence and individual freedom, yet we are confronted with the imposition of state legislation like the new health and safety rules.

Certainly, there seems to be a lot more concern among individual drivers as to future job security, even though the economy seems to have weathered the worst and come through the other side.

The anxiety now among employees seems to be rooted in companies continuing to outsource several key business functions and relocating whole parts of their business to Asia.

This is having a noticeable impact on the cash-for-car proposition because, even though switching to something like a PCP scheme often makes sound economic sense for individual drivers, employees are preferring to remain in the comfort zone of the company car scheme rather than commit to a personal lease which ties them into a vehicle for three years.

As an industry, how can we grow within such an environment?

We all know it won't be easy. While the number of opportunities may be diminishing, the competition is as tough as ever with the ultimate conclusion that there will, inevitably, be fewer winners.

The winners will not necessarily be the large consolidated players that currently dominate our market. If we take a look at the Fleet News FN50 and the top companies within it, the majority of them are either owned by banks or manufacturers. Banks invariably have hidden agendas when straying beyond their core business function and once that goldmine of customer information has been exhausted, they have shown they are only too prepared to exit the market.

Banks have first-class business processes and support systems but they can be distant and inaccessible. Size can be an obstacle to speed and flexibility and can hinder the one-to-one relationships and high customer service levels which customers now expect. After all, when it boils down to it, most people still prefer a voice at the end of a telephone and a vague notion of the geography as to where the owner of the voice might be sitting.

This makes the winners very difficult to predict. But let's look into our crystal ball for a moment. We know the green lobby will continue to exercise a major influence over Government policy and there is likely to be further congestion charging as well as punitive tax legislation on the company car. In 10 years' time the industry will almost certainly look very different. Sure, we will be providing cars in one guise or another but I don't think it will be just cars we are offering. There will be other things to provide – scooters for the city, perhaps. More importantly, we could be providing complete business travel offerings. It may sound far-fetched but could the largest companies in our industry be offering the complete business travel package? Perhaps it will own a travel agency that books rail, flight and boat tickets, arranges transportation to and from airports and enables our customers to comply with the health and safety regulations all at the same time?

There will be a trend towards smaller cars, particularly for drivers who do a lot of city driving. Leasing companies will need to satisfy a variety of customer demands and show they are flexible. For instance, why shouldn't an employee have access to two leased cars – one for the city or domestic use and the other for motorway driving?

Equally, high-achieving employees could be rewarded with a flexible car package which means they drive a 'sensible' car for 11 months of the year but, come August, they can head for the motorways of Europe in a stylish open-top with every comfort known to man.

We live in a world that is over-crowded with information. The key is to give fleet managers the service they need to do their jobs better and make them even more valued within their own company. One thing we can be sure of – customers' demands will be higher in 10 years' time. The leasing companies that survive will be those that are flexible and quick enough to meet the evolving demands of the market and acknowledge that nothing is carved in stone.

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