Ongoing uncertainty in the fleet sector is continuing to boost volumes of medium-term rental, says Meridian Vehicle Solutions.
Phil Jerome (pictured), managing director at Meridian Vehicle Solutions, says that falling business confidence, questions marks over company car tax and the decline of diesel were all important factors that were helping to increase interest in the product.
“Overall, our business volumes by unit have doubled year on year, which is a good indication of the kind of surge that we are seeing at this moment in time,” he said. “This is a trend that is very much being caused by current conditions in the fleet sector.
“You only need to look at the fall in new company car registrations to see that there is a general reticence when it comes to committing to traditional, long-term vehicle leases in the current climate.
“This is happening for very understandable reasons ranging from the in-flux nature of benefit-in-kind taxation to the impact of Brexit.”
Meridian says that renting on a medium-term basis, for 3-12 months, provides a very appealing option for fleets at this moment in time.
It allows them to access a new car for business purposes but effectively put off a longer-term commitment until there is greater certainty, it said.
It has also prompted Meridian to offer a wider choice of vehicles to meet different fleet requirements.
“In the past, we have tended to specialise in prestige and semi-prestige petrol and diesel saloons and hatches because this was the apparent sweet spot when it came to medium-term rental,” said Jerome.
“However, higher demand is also wider demand, and we have increased our range to cover options such as SUVs and PHEVs. All of these are currently finding homes as fleets look to us for more diverse options.”
The current boom in business should lead to a longer-term interest in medium-term rental, claims Meridian, as fleets would become more accustomed to using the product.
“In a very real sense, the issue for us is establishing medium-term rental as a standard fleet option that sits as the obvious choice on a spectrum of vehicle provision between daily rental and traditional leasing,” explained Jerome.
“Our aim is to use this period to position ourselves and our products in this manner. The current uncertainty is a chance to show how well medium-term rental works as a means of satisfying fleet demands in a wide variety of situations.”
Meridian provides medium term contracts to fleets for periods of 3-12 months.