Fleet News

Future of fleets in the spotlight

OUTSOURCING, the gradual replacement of some car fleets with vans and a surge in market share of diesel models are the key trends that will shape the fleet market over the next four years.

The changes, identified by leading industry observers, throw up immense challenges for fleet operators, particularly because as service companies take more business, outsourcing of the fleet manager’s role could increase.

By 2009, the value of the outsourced fleet service sector could rise by £300 million to £11.7 billion.

The study, called The UK Fleet Services Market Development Report and published by Market & Business Development (MBD), claimed that part of the change would come from an increase in the number of manufacturers entering the fleet service and management sector in the search for profit.

The report said: ‘The market for fleet services is forecast to be increased marginally in real terms by 1-3% during the forecast period. The UK fleet services market has displayed all the classic signs of maturity in recent years.

‘The early part of the forecast period is expected to exhibit a decline in growth, supplier consolidation and increasing customer sophistication.’

But at the same time, the industry would become increasingly polarised, with the majority of business locked into a small number of providers.

In addition, sales of diesel cars, already hitting 30% of the private and fleet market, could surge to account for 50% of the new car market.

Diesel cars are expected to surge according to report which predicts that 50% of new cars will run on diesel by 2010.

Another challenge will be a steady stream of changes in fleet policy from specifying company cars for some staff to offering company vans, reflecting a growing interest in health and safety issues on the road and the tax benefits to staff and employers of running commercial vehicles.

The nature of the company car market is also changing according to the report, which states: ‘Although a company car is regarded as an essential tool for a vast number of employees, many companies have already started to downsize their fleets, either by reducing the number of employees and even directors entitled to company cars or by acquiring cars with a smaller engine or lower CO2 emissions.’

The predictions come after experts considered the future role of the fleet manager, as the traditional job title disappeared from company job titles, in favour of merging the role with another department or outsourcing it altogether (Fleet NewsNet, January 20)

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  • For a copy of the report, price £550, call 0161 247 8600

    FLEET SERVICES TRENDS 2004-09

  • Despite the introduction of the BiK tax changes, the company car will remain strong
  • A further increase in acquisition of new cars as opposed to used or nearly-new, particularly in the short-term future
  • An expected increase in diesel and hybrid cars
  • Increasing number of car manufacturers entering the fleet management and leasing sector
  • Increased polarisation of the fleet service industry
  • Increase in outsourcing of fleet services

    Source: MBD

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