For Len Clayton, chief executive officer (CEO) of General Motors Acceptance Corporation Global Full Service Leasing, looking back on a full career of assignments spanning the globe in rental and leasing, both names and nations have changed.
He first become involved in the industry in the 1960s, working in the car rental sector for seven years, including a time in South Africa and Rhodesia (now Zimbabwe) as a rental manager. But for much of his career, he has focused on the leasing sector, starting in 1979. He spent nearly 20 years at Swan National, another historic name in leasing, including seven years as managing director.
Just as the countries and names have become part of history, so has the image of an industry in its very earliest days, according to Clayton.
He said: ‘There is a stark difference looking back. For example, no-one bothered thinking about Europe, because the UK market was so vibrant. There were more risks than rewards in Europe and Britain was really pounding along.
‘But now the UK market is over-supplied and over-populated with companies of various standards, so companies are increasingly looking to the EU for new opportunities.’
Clayton has seen seismic changes in the size of the UK leasing market as it has been driven as much by legislative changes as products.
Changes in the VAT treatment of car leases and the introduction of a 100% writing-down allowance on business cars helped transform the fleet market and drive demand for leasing over the decades.
Looking back, the industry is unrecognisable compared to today. Clayton said: ‘In the 1970s, there were many smaller players and the bigger ones would have had 2,000 or 3,000 vehicles.
‘If you signed a 100-car fleet, people would have major celebrations. But the market was not really customer-driven. It was seen as a tax advantage and a cashflow benefit. ‘But drivers were having to spend up to 60,000 miles with these cars and no-one was asking the customer what they wanted. It was a sellers’ market.’
Today’s industry couldn’t be more different. Suppliers pride themselves on making choice as easy as possible, where many of the key leasing companies operate more than 100,000 vehicles.
But there are still some themes that remain, such as new products appearing that reflect the changing tax circumstances of the time.
One example is the rise of the employee car ownership scheme, which gives drivers the hassle-free benefits of a company car, but transfers ownership to them, so they don’t have to pay emissions-based company car tax, leaving them free to choose the vehicle that is right for them and to save money.
Clayton was behind some of the earliest ground-breaking innovations in leasing during his time at Swan National.
This included the firm’s launch of an open-disclosure system, in which the full profit and loss of a leasing agreement is shown to the client, to emphasise the trust and fairness involved in a deal.
Clayton said: ‘It aimed to take the mystery from the product and, working with Ian Mosley, we developed it. It created the idea of building trust.’
After leaving Swan National, Clayton spent about eight years at what is now Interleasing but becomes Masterlease in June, before taking more wide-ranging roles in General Motors Acceptance Corporation, including his current position.
At Interleasing, he insisted on following his instinct that residual values were the absolute foundation of a leasing company’s strength and getting them wrong would mean crisis in the future.
He said: ‘I have seen three complete residual value cycles in which prices have fallen and then steadied and, over time, you get to see that it is coming. But the important thing is that you cannot mess about with residual values. Get it right and you are a happy man, get it wrong and you certainly know about it.
‘You can see there is a pattern by looking at the past.’
To mark his departure from GMAC, Clayton was joined at Claridges in London by friends made during his time in the industry.
And while looking back at the past, he is also looking forward to the future. For the industry, he predicts changes including a decline in traditional contract hire in favour of more tax-efficient schemes, such as ECOS and those that benefit all employees.
Eventually, he believes the UK might follow the US model of most drivers leasing their cars, instead of buying them.
He thinks manufacturers are likely to become more involved in leasing as well, as the lines between retail and business sales become blurred.
But Clayton has more lofty ambitions as he leaves the leasing industry behind. As well as a planned move to the south of France, he is planning to indulge his passion for flying.
He has held a licence since he was 17 and spent 10 years in the RAF before moving into the fleet industry. He already runs a small plane.
He added: ‘I am also learning French for flying into the smaller airfields, because they tend not to use English like the larger airports.’
Following a career spanning more than 30 years, Clayton is full of praise for the fleet industry, even though he now plans to focus on enjoying retirement.
He said: ‘I have really enjoyed my career and my roles. It has been challenging and fulfilling and I have met so many wonderful people that have been great to work with. But I am not planning a comeback – this is full retirement.’
Career ends with Polish award
ONE of Len Clayton’s final engagements as CEO of General Motors Acceptance Corporation Global Full Service Leasing (GMAC GFSL) was a visit to Poland – and he came back with an unusual souvenir.
He was presented with the medal of the mayor of Gdansk, Pawel Adamowicz, giving him the freedom of the city in recognition of GMAC’s investment in Poland.
The commemorative award was presented at a gala dinner attended by local dignitaries and members of the business community and celebrates Futura Prime’s (Masterlease’s trading brand in Poland) position as the number one leasing company in Poland.
With its European full service leasing brands, Interleasing and Masterlease, GMAC expanded beyond the traditional western European countries by moving into eastern Europe three years ago.
Masterlease now has 10 operations in Europe and Futura Prime ranks 19th in Poland’s nationwide index of financial businesses.
Clayton said: ‘It’s an honour to receive such important recognition from the city. ‘Masterlease works closely with the local community in Poland to provide opportunities for young people and to support the local economy. We hope to continue this work and expand into other eastern European countries such as the Czech Republic and Hungary.’