Fleet managers could save tens of thousands of pounds in end of life de-fleeting costs and improve residual values (RV) by opting for ongoing smart repair work throughout the life of the lease, according to ACIS.
Fleet drivers typically take a car over three years and return it to the lease company with a variety of shunts, scrapes, scuffs, chips and cracks, all of which also puts a bigger dent in the vehicle’s on-going RV.
The cars go through a de-fleet process, but the centre carries out end of lease life repairs calculated upon a pre-determined ‘menu price’ for the affected panels based upon a sliding scale of profit per job – an often over-costly process that can delay the signing off of repairs.
The cost of this work is always passed back to the leasee, and often runs into thousands of pounds across a multitude of vehicles.
A typical BMW rear bumper with slight damage would cost circa £300 to a fleet manager to repair based upon the menu price, but a smart repair mid-lease would be two-thirds lower. Across a fleet of 500 vehicles, this type of repair would save £120,000.
Smart repair covers everything from dents, chips and scuffs on bodywork, windscreens and alloy wheels to invisible repairs on plastic bumpers and interior dashboards as well as leather upholstery, enabling the vehicle to once again look as it did on day one of the lease.
Smart technology is now being increasingly used mid lease when cars go in for servicing.
Research by ACIS suggests that dealerships, on average, service 20 cars a day and sell a further 20 used cars a month. Of the cars serviced:
- 40% will have alloy wheel damage
- 30% will have bodywork scuffs
- 20% will have some form of bumper damage
- 10% will have windscreen chips or cracks
- 5% require interior repair
Smart technology is already widely deployed in the de-fleeting sector as business vehicles are prepared for re-sale, but small, cost-effective repairs can be sanctioned by fleet managers when they go into a garage for an MOT or service.
The technician usually looks over the car in advance with the customer to make sure there is no damage during the work and this is the perfect time to point out superficial damage that could benefit from smart repair.
Graham O Neill, chief executive of ACIS Ltd which works with both the bodyshops and the insurance companies, said: “This nip and tuck work is a non-insurance damage - low cost issue and can be sorted out while the car is off the road for other reasons and often done on the spot.
"We would suggest fleet managers make greater use of it and direct drivers towards garages that offer it.
"It also changes behaviours among fleet drivers who are taking more care of the vehicle during its lifetime which has many brand reputational issues as well as preserving the RV when the vehicle is handed back.
“The Holy Grail for most fleet managers is zero-dents to the fleet’s RV whether this is managed through the third party fleet provider or they are purchasing the vehicles themselves.
"Ongoing cosmetic repairs that guarantee easy resale at reduced cost to the business has got to be an attractive option all-round.
"Vehicles look better for longer while they are on the books and cost less to the business in the long run.”