Fleet News

Broker ‘deals prove a draw’ to fleets

The acceleration of new vehicle registrations in Britain is being greatly assisted by an array of cut-price deals being offered by some British brokers to fleets run by small and medium-sized enterprises (SMEs).

These brokers are also proving themselves to be highly skilled at marketing these deals online to ensure they are seen by the greatest number of potential customers.

Earlier this month, the Society of Motor Manufacturers and Traders (SMMT) raised its forecast for new car registrations in 2013 to 2,216,000 – up 8.4% on 2012. Fleet and business registrations account for 53% of the market at 696,837 vehicles – an increase of almost 6% on the 661,354 vehicles registered in the same period last year.

Rebecca Dart, media co-ordinator for SMMT, told Fleet News: “We’ve upped our forecast simply because we have more confidence in the industry for the coming year.

“Some of the deals being offered by brokers are proving a draw. In addition, manufacturers are also now providing far better fuel economy than has ever previously been the case.

“When people are replacing their cars, they’re doing a great deal of research online to get the best fuel efficiency as well as the best price.”

One of the brokerages that is leading the market is Manchester-based Leasing Options.

Gareth Roberts, head of online sales and marketing at Leasing Options, told Fleet News that the company was able to offer “industry-leading” deals as a direct result of working with a network of franchised dealerships as well as close ongoing relationships with large finance companies such as Lex Autolease, Arval, ALD and LeasePlan.

Roberts said: “We’re trying to focus on five or six vehicles most weeks and ensuring that they’ve got the broadest possible appeal to companies.

“The volumes this year have gone really well –we’re massively up on last year. We’re seeing many smaller businesses which have traditionally bought vehicles looking to get best value and they’re coming to us to secure this.”

Leasing Options, which has been running for 23 years, has historically undertaken 80% of its trade with business users while the remaining 20% has been with private motorists.

Roberts added that the 80:20 ratio has recently shifted to 70:30 as an increasing number of private individuals seek to drive new cars with lower fuel consumption.

One of the Leasing Options deals on a Mercedes-Benz E300 Bluetec Hybrid AMG Sport saloon is priced at £309 per month – £60 less than the cheapest equivalent beusiness deals on comparecontracthire.com.

Roddy Graham, chairman at the Institute of Car Fleet Management and commercial director at fleet management company Leasedrive Group, paid tribute to the ongoing success of brokerage companies in harnessing the power of the internet. He said: “I think that many companies have been immensely successful in mastering internet marketing.

“And many brokerages serve a very useful purpose within the marketplace serving private individuals and some of the smaller SMEs.

“But the larger fleet management companies still best cater for the demand of the large corporates in order to ensure that they secure the cars in the volumes they require to their precise specifications.”

Graham added that large fleet management companies offer consistently good value for vehicles and these prices don’t rapidly evolve according to vehicles’ availability.

What’s more, he added that Leasedrive Group, in common with many other fleet management companies, only place orders for vehicles when a customer orders that specific vehicle.

He added:  “With larger mid-market and big blue chip organisations, compensation and benefits policy management is also vitally important.

“This requires a stable and competitive pricing approach which tends to be best served by long-term strategic – as opposed to short-term tactical – vehicle prices.”

The increased figures for UK registrations contrast starkly with those being recorded in mainland Europe.

According to the European Automobile Manufacturers’ Association, new car registrations in June totalled 1,134,042, which was down by 5.6% compared to the same month last year.

In the first six months of 2013, 6,204,990 new cars were registered in the EU which is 6.6% less than in the first six months of 2012. 

The European Union remains Britain’s largest exporting market and some observers fear that subdued demand will have an impact on Britain’s automotive manufacturers.

Others predict that manufacturers will bolster the number of right-hand drive vehicles they produce for the British marketplace to increase sales.

This could result in more highly-competitive deals in the future as manufacturers strive to ensure that these vehicles are sold.


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Comments

  • Rob Chisholm, M.D., Applewood Vehicle Finance Ltd - 30/08/2013 14:43

    I think Roddy Graham is a knowledgeable and likeable fellow, but he does himself a disservice with his outdated portrayal of the leasing broker market for his own ends. There are very many highly professional leasing brokers who over the past 25 years have become increasingly sophisticated and who actually provide the services they speak about as opposed to the ones that the 'majors' include in their Powerpoint presentations but very rarely follow through on in reality. The leasing broker market can cover one man bands pushing the manufacturer led deals through to long, well established businesses who pride themselves on the high level of personal service provided. Please don't tar the whole market with the same brush. Why, even the BVRLA officially recognised the importance of this market more than 10 years ago. And yes, we are a leasing broker - established 1989 and counting, having proudly enjoyed trading links with Network Vehicles (now a member of Leaseplan group) since 1991 and with Arval since 2004 and with a very established customer base of fleets up to and including 100 vehicles and who call the M.D. when they need to knowing full well he will take their call. Small, and proud of the fact!

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