INTERNATIONAL
FLEETW RLD All that matters in the world of fleet August 2014
Driven Brilliant new C4 Cactus New Merc C-Class
Leasing How the industry is going global
Style meets substance The Lexus hybrid success story continues apace
plus...
Going eco in Ford’s latest Transit internationalfleetworld.com
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INTERNATIONAL
FLEETW RLD All that matters in the world of fleet
August 2014
Driven
contents
Brilliant new C4 Cactus New Merc C-Class
Leasing How the industry is going global
Style meets substance The Lexus hybrid success story continues apace
plus...
Going eco in Ford’s latest Transit internationalfleetworld.com
Managing Editor Ross Durkin ross@fleetworldgroup.co.uk
20 25 years of leasing for Arval.
22 2,000km eco-driving in a Transit.
32 Lexus’ hybrid-fuelled fleet offering.
38 Citroën C4 Cactus put to the test.
Publisher Jerry Ramsdale jerry@fleetworldgroup.co.uk Editor John Kendall john@fleetworldgroup.co.uk Deputy Editor Alex Grant alex@fleetworldgroup.co.uk Business Editor Natalie Middleton natalie@fleetworldgroup.co.uk Features Editor Katie Beck katie@fleetworldgroup.co.uk Sales Director Anne Dopson anne@fleetworldgroup.co.uk Sales Executives Darren Brett darren@fleetworldgroup.co.uk Claire Lake claire@fleetworldgroup.co.uk Circulation Manager Tracy Howell tracy@fleetworldgroup.co.uk
04 Fleet Review Editor John Kendall on the dominance of the premium sector. 06 Inside Knowledge How realistic is EV ownership? Bart Vanham investigates. 08 News The biggest stories from a month in the international fleet world. 16 Strategy Exploring the leasing industry’s expanding global footprint.
Head of Production Luke Wikner luke@fleetworldgroup.co.uk
20 Leasing Arval celebrates 25 years with a range of new customer solutions.
Designers Tina Ries tina@fleetworldgroup.co.uk
22 Eco Driving John Kendall drives the Ford Transit ECOnetic over 2,000km.
Samantha Hargreaves sam@fleetworldgroup.co.uk
25 Remarketing How online buying influences Brazil’s used car market. 26 RVs The benefits of falling rental rates for fleet operators across Europe. 28 Fleet Focus How Germany’s fleet sector is bouncing back after a slow few years. 30 International Fleet Academy Reducing TCO for global fleets.
Published by Stag Publications Ltd, 18 Alban Park, Hatfield Road, St Albans, Herts, AL4 0JJ tel +44 (0)1727 739160 fax +44 (0)1727 739169 email ifw@fleetworldgroup.co.uk web internationalfleetworld.com
32 Profile Lexus’ success with its hybrid drivetrain in Europe, and new NX. 36 Launch Report Mercedes C-Class / Fiat 500L / Citroën C4 Cactus / Opel Astra. 40 Global Fleet Forum A round-up of activity on the popular fleet forum. 50 Fleet in figures Breaking down the global vehicle sales by region.
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internationalfleetworld.com / 03
fleet review This month, editor John Kendall looks at how premium brands are starting to dominate the fleet sector.
Premium or volume? We know the D-segment has been under pressure for some time and it can’t come as much of a surprise that premium brands are now dominating the sector. With the purchase price/residual value balancing act that fleet suppliers have to manage, premium/higher price/higher residuals vs. volume/lower price/lower residuals is going to have drivers queuing for the blue propeller and the 3-pointed star. And so it proves. During the first four months of the year the top selling European D-segment slots are filled by the BMW 3 Series as best seller, VW Passat 2nd, Mercedes-Benz CClass 3rd and Audi A4 4th. No sign of a Mondeo or Insignia, even though the latest Insignia is selling well. Having recently driven the new C-Class, which will be available with a fleet-friendly 1.6-litre diesel before long, it looks like the pressure on volume D-sector models will only increase.
NAFA CAFM The premium vs. volume debate is just one of the many things that a modern fleet manager has to deal with. As cars become more complex, vehicle choice and fleet option becomes more diverse, not to mention the maintenance and day-to-day management aspects of the job and there is more and more to learn. In the US the NAFA Fleet Management Association offers comprehensive training to help fleet managers get to grips with the many aspects of the job. Earning the status of Certified Automotive Fleet Manager involves a series of examinations covering eight disciplines including: Fleet Information Management, Maintenance Management, Professional Development, Vehicle
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Fuel Management, Asset Management, Business Management, Financial Management, and Risk Management. The scheme is open to non-members too. NAFA is running a boot camp in October for those studying for the qualification and for interested parties, visit http://www.nafa.org/bootcamp.
Germany: estate & pickups When I first started writing about the industry over 25 years ago, Germans drove cars. Not estate cars, or anything as vulgar as MPVs. Mercedes and BMW just did not make estate cars until the 1970s and only did so with some reluctance. But we live in a fast changing world. Now Germans like estate cars very much and they are among the top choices for fleet drivers. I was surprised to hear from ALD when researching our feature on Germany (page 28)for this issue that Germans are now happily embracing the pick-up truck too. They seem to like the flexibility of a vehicle that can be used as a car for work and for carrying bikes and outdoor equipment at the weekends. Perhaps I shouldn’t be surprised, as Germany is after all the nation that brought us the camper van.
World Cup sales decline What has football got to do with car sales? Now that Germany has scooped the World Cup and Scolari has stood down from managing the Brazilian team, perhaps the Brazilians will get back to buying cars. The World Cup kept the Brazilians away from show rooms in huge numbers, sending June sales down -17% to their lowest since 2010. But analysts reckon that buyers will be back despite the weak economy.
visit internationalfleetworld.com
New Vivaro
Ready for bigger plans. With loading capacity for up to 3 euro-pallets and extra-wide loading doors (up to 250 degrees). Designed to get work done. opel.com Fuel consumption combined 6,5–5,9 l/100 km; CO2 emissions combined 170–155 g/km (according to R (EC) No. 715/2007).
inside knowledge
To EV or not to EV? That is the question... How realistic is electric vehicle ownership? That’s a question that Bart Vanham of TCO Plus set out to answer.
W
ould I drive an electric vehicle? That was drives usually involve an overnight stay; so I have time the question that kept me busy for a to recharge. number of months. Me being Bart Vanham, Business trips and weekend trips within Belgium are entrepreneur in the automotive and fleet market. I am maximum 250km, sorry, 125km up and 125km back, actually a tax consultant (nobody is perfect), specialagain a mistake: range is only a one way trip, charging ising in car taxation in the EU and beyond. These car and back. Oops, next research... was public charging taxes, linked in over 20 countries to CO2 emissions, already an option to take into account? Well in Belgium, and tax incentives for hybrid and electric vehicles, are yes and no: yes indeed if you are willing to plan your important when measuring the effects of CO2 trip carefully with the closest available charging station improvement programs, or even when comparing and yes if you have the guts to ask your client or family cars and comparing different power trains. Being if you could plug in the car, a question which, by the involved in some projects where for OEMs it was way, is a super conversation starter…. And no because important to show customers the real cost of use, there are not that many charging stations yet in instead of looking at purchase prices, I soon discovBelgium, they are not all accessible using the same card, ered that indeed driving electric vehicles was not as and they are not all fast charging. expensive as it first appeared. The RANGE issue research taught me that I could So I did some test drives and hallelujah, driving elecindeed drive electric, but that the range should be at tric was fun… A Toyota Prius Plug-in opened the world least 300 to 350km. I would have to be prepared to plan of driving silently, enjoying pure the trips I took more carefully. I What range anxiety? Tesla Roadster music, or nothing. A Nissan Leaf would have to bother people and made a 236km business trip easy. made me want for more with its hotels for sockets and occasioninstant torque and fun driving. A ally I would have to be very kind Tesla Roadster blew my socks to my wife or father (as I always off and a Tesla Model S made am) and use their cars. me dream of a car again from Using the Tesla Roadster, with a long ago. range of 285km on 80% of the Could driving pleasure, good battery, but more like 230km with economics and environmental the addition of normal driving for benefits work together again? the challenging trip of 236km to Before answering that question, I needed to tackle Amsterdam, convinced me. When booking the hotel the the issue of range anxiety, as it is commonly used by receptionist kindly confirmed that it was no problem to those opposed to change. Did I dare to take the risk? charge the car, she would even reserve the parking place Some research and lots of little movies on YouTube next to the socket. Charging: check! What about range? I of people actually driving EVs made me realise that I saw on one of the movies on YouTube that to save on also made mistakes in looking at range. Yes indeed I energy, surfing was the way forward. So I drove quite needed the car to go skiing and for summer holidays, some kilometres behind big SUVs taking the wind from with each a one-way trip of at least 1,000 to 1,500km, my car. When I arrived in Amsterdam, I still had 102km and yes, I drive to Amsterdam, Dusseldorf, Frankfurt of range left, plugged it in and the next morning I was and the like for meetings, trips of 350km average one ready to leave fully loaded. After the meeting with a way. But, being totally honest with myself, for skiing or client, I drove back home paying attention to the range summer holiday, I could take my wife’s car, or my but the anxiety was completely gone…. EV vs BART: 1-0!!! father’s car, or even rent one, or take the plane. And the Unfortunately they are really expensive, aren’t they? meetings in Amsterdam and other long distance Next time, I will throw a light on that part of my odyssey...
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DIARY DATE
SILVERSTONE CIRCUIT
12TH MAY 2015
To find out more about Fleet Show 2015, call +44 (0) 1727 739160, email info@thefleetshow.co.uk or visit www.thefleetshow.co.uk
business news
Mercedes-Benz adds lowCO2 diesels to CLA and GLA
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ercedes-Benz is adding new diesel engines to the CLA and GLA-Class, bringing CO2 emissions down to 104g/km and 103g/km respectively. Already available to order in selected markets, with first deliveries from September, the new engines form part of a package of additions for the carmaker’s compact models. The CLA 200 CDI will use a new 2.2-litre engine, replacing the 1.8-litre diesel used to date. The result is a large cut in running costs, with fuel economy of 4.1l/100km or 4.0l/100km for the 7G-DCT dual-clutch automatic, compared to 4.5l/100km and 118g/km for the old version. In the GLA-Class range, the new 180 CDI variant introduces the same 1.5-litre Renault-Nissan sourced diesel engine used in the A-Class as an entry-level front-wheel drive model. This 109PS engine returns 3.9l/100km and emits 103g/km with the 7G-DCT gearbox, or 4.0l/100km and 105g/km with the manual. 4MATIC four-wheel drive will also be introduced on the CLA 200 CDI, CLA 220 CDI and A220.
Eighth-generation VW Passat makes world premiere he eighth-generation Volkswagen Passat has made its world premiere in both saloon and T estate bodystyles, showing its sleeker design, economical engines and advanced technologies. Unveiled at the Volkswagen Design Centre in Potsdam, the latest Passat is based on the group’s modular MQB platform, which also underpins the Golf Mk7. Helped by the use of lightweight materials, the 2015 Passat is actually lighter than before – by up to 85kg – and offers more passenger space despite being shorter than the outgoing model. It also offers a sleeker design, with lower body, longer wheelbase and larger wheels, and brings up to 20% better fuel economy from a range of 10 direct-injection turbocharged petrol and diesel engines, with a plugin hybrid also available. Prices in Europe start from €25,875 (saloon) and €26,950 (estate).
Opel previews new Corsa pel has revealed the fourth-generation Corsa O supermini, ahead of sales beginning at the end of the year. While the new model is loosely based on the same platform, upgrades are significant. Cabin space and overall dimensions are almost unchanged, but none of its chassis components are shared with the old car and everything including suspension pickup points in front of the windscreen is new, promising improvements in ride and handling. Petrol engines at launch will include the 1.0-litre three-cylinder ECOTEC Direct Injection Turbo, offered with 90PS and 115PS and a choice of six-speed manual or automatic gearboxes, plus updated versions of the 1.2 and 1.4-litre four-cylinder units fitted to the outgoing car. Opel has also upgraded the 1.3 CDTi diesel to meet the strict new Euro 6 emissions standards offering CO2 emissions of 89g/km at launch. The new Corsa will be shown at the Paris Motor Show in October.
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Uruguay’s UTE adds Renault Kangoo EVs to fleet ruguay’s state power company UTE has taken U delivery of 30 electric Renault Kangoo Z.E.s for its fleet. The electric vans will be used in the capital Montevideo and elsewhere in the country and will enable UTE to reduce the annual CO 2 emissions produced by its vehicle fleet by 36 tonnes. In 2008, Uruguay committed to an ambitious programme aimed at diversifying its sources of electricity. Today, 84% of the country’s electricity comes from renewable sources and the government’s target is to extend this figure to 90% thanks, in part, to the development of wind farms. The order was greeted by Renault as further evidence of the buoyancy of the electric vehicle market in its Americas Region.
For the latest news, visit internationalfleetworld.com
Fuso Canter E-Cell electric truck begins on-road trials aimler subsidiary Fuso has begun a year-long test of a fleet of D eight electric Canter trucks with fleets around Portugal, where it is manufactured. Based on a 3,400mm wheelbase Canter, the Canter E-Cell features a single cab and a choice of 4.3 or 4.4-metre box bodies. The electric drivetrain produces 148bhp, used to drive the rear wheels, and features four battery packs fitted in two boxes on either side of the frame. On a conventional 230V supply these will reach 100% capacity in seven hours, reduced to one hour on a rapid charge. Fully charged, the Canter E-Cell will travel over 100km.
fleetweet a few soundbites from a month in fleet
@LowyInstitute Offical Twitter account for The Lowy Institute, Australian international policy think tank
Australia scraps the #carbon tax despite 63% of Aussies saying Aus should take leadership role in reducing emissions.
@ACEA_eu
Jaguar Land Rover reveals new sub-100g/km engine family
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aguar Land Rover has announced details of its new Ingenium family of lightweight diesel and petrol turbocharged engines that are expected to deliver sub-100g/km emissions and will also support hybrid drive systems. Set to debut in the Jaguar XE, the new units are the replacement to the former Ford-derived engines and have been designed and engineered in-house by Jaguar Land Rover engineers. Volume production begins in early 2015 at the all-new Jaguar Land Rover Engine Manufacturing Centre near Wolverhampton in the UK, with the first engine to be a 2.0-litre diesel known as AJ200D.
Official Twitter account for the European Automobile Manufacturers’ Association (ACEA)
More than 55% of patent applications by the #automotive sector are filed in Europe.
@Lebeaucarnews Phil LeBeau, motoring journalist at CNBC
NEW: #Fiat on speculation of deal w/ #VW: "Fiat states that they have not held discussions with Volkswagen regarding a potential merger."
@iRAPSavingLives Official Twitter account for international road safety charity iRAP
SEAT unveils new Leon X-PERIENCE crossover
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EAT has released details of its new Leon X-PERIENCE, which goes on sale from the autumn providing an insight into the carmaker’s forthcoming first SUV. The new model joins the existing Leon line-up as the fifth model and features permanent four-wheel drive along with all-road suspension and kit, and a range of TDI and TSI engines. SEAT also promises its “typical features of exceptional quality and outstanding value for money”.
#roadsafety assessment starts today in Tamil Nadu, India which will look to prevent some of the 16,000 road deaths in the state each year.
@deanslavnich Dean Slavnich, automotive journalist
Cars that emit only water vapour at their tailpipe make so much sense. Car makers like Toyota championing fuel cell tech should be applauded.
@wbluestein Whitey Bluestein, business consultant
Telefónica report says cars with built-in connectivity will grow from 10% of global market in 2013 to 90% by 2020.
internationalfleetworld.com / 09
Impress with less. The new C 220 BlueTEC with CO₂ emissions of just 108 g/km.
A Daimler Brand
A lightweight construction, state-of-the-art materials, and a super-efficient engine make the new C-Class the best in its segment. It gives you everything you could ever want from a car of this class – even smaller fuel bills, and even greater driving enjoyment. www.mercedes-benz.com/fleet
Fuel consumption urban/extra-urban/combined: 7.6–5.2/5.1–3.7/6.0–4.3 l/100 km; combined CO₂ emissions: 140–108 g/km. Provider: Daimler AG, Mercedesstraße 137, 70327 Stuttgart, Germany
Efficiency class: B–A+.
environmental news
Mitsubishi to expand Outlander PHEV sales by 66%
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itsubishi Motors is to increase production of the Outlander PHEV from 30,000 units in the 2013 financial year to 50,000 in 2014, following much greater than expected global demand. The carmaker had initially planned for 21,000 units at the Nagoya Works Okazaki plant, located in Aichi Prefecture, Japan, but supply was outstripped in its domestic market shortly after launch. This financial year, Mitsubishi is expecting to exceed that figure by 138%, and the PHEV will account for 37% of all global Outlander production, website Car Watch reports. With sales of the conventional Outlander and ASX growing, the plant’s output will grow 22% from 174,000 to 212,000 during the 2014 financial year, and PHEV production will be streamlined. Electric drivetrain components, which have been manufactured separately, will be integrated into the main production line as part of wider upgrades on site. Demand has been so strong globally that the car has
yet to launch in North America and has only recently arrived in Australia. Most of the early European volume was sold to the Netherlands, where high incentives for plug-in hybrids meant it accounted for almost all Outlander volume. European volume is continuing to grow as it reaches new markets. The Outlander PHEV launched in the UK in April, and figures from the Society of Motor Manufacturers and Traders (SMMT) show it already accounts for 35.8% of all plug-in hybrid and range extender sales for the first six months of 2014, or 542 units. Priced the same as the equivalent 2.2-litre diesel with an automatic gearbox, Mitsubishi Motors UK anticipates 62% of Outlander volume will be the PHEV, and will increase its company car sales volume by 184% this year. Fleet demand is so strong that new company car specialists are being appointed across the UK dealer network, around 60% already have them.
California extends carpool lane access for plug-in hybrids
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he State of California has extended its carpool lane access programme for plug-in hybrids, after the initial run of 40,000 stickers ran out in just over two years. Clean Air stickers, available in green for plug-in hybrids and white for CNG or battery-electric vehicles, allow drivers to use California’s High Occupancy Vehicle (HOV) lanes without having two or more passengers. Introduced in February 2012, the scheme was originally due to issue a limited run of 40,000 plug-in hybrid stickers
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but has been very popular with consumers. The California Air Resources Board ran out before the start of May, but the State will now issue an additional 15,000 stickers to the first applicants. Its replacement is proving similarly popular, with 40% of Chevrolet Volts sold in California alone, and recent legislation extended its original 30 September 2017 expiry date to the 1 January 2019. HOV lane access is said to cut the average commuting time by a third – or 36 minutes.
For the latest EV news, visit evfleetworld.com
Beach sand could triple EV battery range R
esearchers in California have discovered a way to triple the service life and energy density of lithium-ion battery cells using beach sand. The team, based at the University of California, Riverside’s Bourns College of Engineering were investigating ways to produce high performance nano-silicons, which can be used to replace the graphite used in the anode (negative) side of most lithium-ion batteries to date. Sand contains high qualities of quartz, in turn composed of silicon and oxygen. Once purified, heat, salt and magnesium can be used to separate the oxygen from the silicon, producing a nanoscale silicon with a porous, sponge-like consistency said to be ideal for high-performance applications. The advantage is that this also uses cheap and abundant materials needed for high-volume production. So far this has been used in a coin-sized battery, but ongoing research will develop pouch-type cells for mobile phones and electric vehicles. Increased energy density could cut costs and dramatically improve the performance and durability of future applications.
Daimler and BMW form wireless charging partnership
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aimler and the BMW Group have signed an agreement to develop a standardised inductive charging system for electric and plug-in hybrid vehicles. The technology transfers energy via a magnetic field, allowing a vehicle to be recharged without physically plugging it in, and is familiar from electric toothbrush charging stands. Under the agreement, the two companies will co-develop vehicle and ground-mounted coils, plus data sharing to help drivers align the two via the dashboard display. Once positioned correctly, these will be able to charge at 3.6kW with 90% energy efficiency, capable of charging most plug-in hybrids in less than three hours, or the BMW i8 in less than two. The technology is unaffected by bad weather, shuts off automatically if it detects a foreign object and is claimed to emit little ambient radiation. There is also the possibility to double the charging rate and add smartphone controls in the future, the carmakers have said.
EV
The distance recently driven by two Norwegian eco enthusiasts in a Hyundai ix35 Fuel Cell, on one tank of hydrogen.
in numbers
in brief Tesla takes International Engine of the Year prize Tesla has won the Green Engine title at the International Engine of the Year Awards for the Model S’s drivetrain, the first time an all-electric unit has won at the event. It beat the range extended and fully electric versions of the i3, plus Ford’s 1.0-litre EcoBoost petrol, to take category honours.
China to remove EV purchase tax The State Council of China is to waive the substantial purchase taxes on ultra-low emission vehicles, aimed at nurturing its domestic industry, improving air quality and reducing its energy dependency. All plug-in hybrid, electric and hydrogen fuel cell vehicles will be exempt between September 2014 and the end of 2015.
Toyota announces fuel cell pricing Toyota’s irst hydrogen fuel cell car, unveiled recently in production form, will be priced at ¥7m (€50,000) in Japan, the carmaker has con irmed. Selected markets in Europe and North America will get the car during summer 2015, and prices for these have yet to be announced.
EVtweet of the month @DylanS_CAP Dylan Setterfield, Senior Forecasting Editor at CAP
Nearly 40% of premium brand drivers would buy, or seriously consider, an electric car with 300 mile range. 60% not even willing to consider!
60g/km CO2 emissions for the 400PS Volvo XC90 SUV, launching at the end of the year.
700km
SOURCE: Hyundai
SOURCE: Volvo Cars
internationalfleetworld.com / 13
manufacturer news
UK air quality to breach EU levels until at least 2030 T
he UK is to break nitrogen dioxide limits until at least 2030 – more than 20 years after the original deadline – EU judges have been told, despite the fact that the Government previously said that limits would be met by 2025. The data, which suggests that three of Britain’s cities – London, Birmingham and Leeds – will exceed the European air pollution limits, comes as the UK faces legal action for its failure to meet the legal limits.
Fleet Logistics expands into Turkey leet Logistics has opened new operations in Turkey to support F the fast-growing fleet market as part of its continued expansion across mainland Europe and the Near East. Launched to service new and existing fleet customers, the new Fleet Logistics venture in Turkey is located in the capital Istanbul, based at the local headquarters of its parent company, TÜV SÜD.
Europcar to recruit new CEO as part of new phase of development uropcar has announced plans to search for a E new CEO as it announces measures aimed at preparing the company for the “ambitious next phase of its development.” The firm announced that current CEO Roland Keppler will end his term of office as of 31 July 2014 by mutual agreement with the Board of Directors and shareholders of Europcar Group.
ALD’s Christophe Duprat becomes new chair for Leaseurope Automotive Steering Group has announced the appointment of Christophe Duprat LTheeaseurope as the new chair of its Automotive Steering Group (ASG). ASG is responsible for developing arguments and positions on EU regulatory and legislative issues in the automotive sector. Mr Duprat is currently director of strategy at ALD International after joining the firm in 2006 following six years of strategy and management consulting.
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in brief Vehicle sales plummet in Russia Sales of new cars and light commercial vehicles plummeted in June, leading the AEB (Association of European Businesses) to sharply cut its 2014 forecast. Figures from the AEB show that sales dropped by 17.3% compared with June 2013 to reach a total of 199,398 cars. The AEB is adjusting its 2014 full year forecast for the Russian PC and LCV market to 2.45 million units, down 335 thousand units or 12% from the market result in 2013.
Enterprise Rent-A-Car expands into Iceland Enterprise Rent-A-Car is continuing its European expansion programme with the appointment of Reykjavik Excursions as a franchise partner in Iceland. The latest agreement follows the recent news that the car hire specialist has opened operations in the new markets of Belgium, Czech Republic, Cyprus, Bosnia Herzegovina and Macedonia as part of its phased expansion programme. The firm also said that it would become operational in additional countries throughout Europe in the coming months.
Sofico acquires Car Systems in France Belgium-based Sofico, a privately owned provider of global fleet, leasing and mobility software, has acquired French IT solutions company Car Systems. Sofico said that the acquisition fits perfectly with its growth strategy and broadens its market coverage to include short-term car, van and truck rental. It also provides a solid foothold in the French and southern European fleet markets, where Sofico already has a number of customers.
STRATEGY Operational Leasing
Car leasing goes gl bal The biggest leasing companies are getting bigger as they extend their global footprints to new markets, reports Steve Banner. Arval sets up China JV
Long-term outlook for Russia encouraging?
Champagne corks were merrily popping in Shanghai, China back in June as Arval, a subsidiary of French banking giant BNP Paribas, signed a joint-venture deal with Shanghai Ba-shi Car Rental Service. With a 5,000-strong fleet of vehicles leased to businesses of all sizes, the latter is said to be the city’s biggest full-service leasing operation. “We want to ally the strengths of the two companies to create an enterprise that will become the leader in fullservice leasing in China,” Arval chief executive officer, Philippe Bismut says. “This partnership is another key milestone in the group's development plan so far as the Asia Pacific region and China in particular are concerned,” says BNP Paribas Asia Pacific chief executive officer, Eric Raynaud. “China represents a key market for us.” Active in China for two years, Arval signed a partnership agreement with the Bank of Nanjing in 2013. At present the Chinese contribution to Arval’s coffers is comparatively modest, but Bismut, Raynaud and their colleagues are clearly convinced that this will not always be the case. Car registrations in China, now the world's largest car market, rose by 12.3% in the irst half of 2014. Fellow French group PSA Peugeot Citroën saw its unit sales rise by 28% thanks to the positive performance of joint ventures Dongfeng Peugeot Citroën Automobile and Changan PSA Automobile. China is not the only global market outside Europe with growth potential so far as Arval is concerned. With its own operations in 25 countries and present in 14 more through partnerships, the company leases almost 700,000 vehicles to customers worldwide and manages an additional 40,000. Last year saw its activities in Turkey expand by 28%, in Brazil by 11% and in Russia by 8%. All three are countries with a variety of political, economic and social problems; but such difficulties do not necessarily mean that demand for vehicles acquired under operating leases is always choked off.
Viewed by many as a global pariah in the wake of its annexation of Crimea, suspended from the G8 group of industrialised nations and facing existing sanctions that may be followed by others of worsening severity, Russia was already suffering an economic slowdown prior to the Ukrainian crisis. Subsequent events have not helped. “Add to this the prospect of increased constraints on access to foreign funding and one would expect extra downward pressure on the leasing industry and increased negative sentiment among independent lessors,” says Peter Kainradl, managing director, Austria and Germany, at White Clarke Group. “Yet a period of stasis in the economy could actually work in favour of alternative methods of finance as it forces businesses to be more discerning with resources and encourages them to diversify sources of funding. “Russian lessors are realistic in their view that the shortterm prospects are lacklustre but have grounds for optimism for a return to growth,” he adds. “And while auto leasing, especially of passenger cars, is low, with bank loans being the primary source of finance, the fleet segment is seeing signs of growth in leasing with increasing prospects for operating leases.”
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New markets attractive for leasing majors The fact that leasing remains a novel concept in a number of major global economies and the growth possibilities they offer when compared with more mature markets is one reason why companies such as ALD (now responsible for over 1m cars), Arval, and LeasePlan are eager to expand into them. Active in over 40 countries from Algeria to the USA on its own account and through partnerships, ALD saw its activities grow by 67% in Mexico, 43% in Brazil, and 33% in China in 2013. “Whereas in the UK or the Netherlands full-service leasing accounts for over 50% of the corporate car parc, in China or Russia it’s single digits, with massive growth potential,” says chief executive officer, Mike Masterson.
12 months ago LeasePlan set up an offshoot in Russia. “With the leasing market still relatively new there we intend to play our role in bringing innovation and value-added leasing services to clients in the market,” says chairman and chief executive officer, Vahid Daemi.
Southern Europe – challenging economies Another reason behind the enthusiasm for going global is the sluggish performance of the economies of some of those countries where Arval – now celebrating its 25th anniversary – and its competitors are more irmly established. “The situation remains challenging for Europe’s Mediterranean region – Spain and Greece in particular – which continue to suffer from the economic crisis,” the company observes. At the same time however its Belgian subsidiary grew by 10% in 2013; evidence perhaps that not all of the European Union (EU) is in the doldrums. None of the foregoing should be taken to imply that the big leasing groups are neglecting more familiar markets in the dash for worldwide growth.
LeasePlan – new Canada operation complements US Last January saw LeasePlan set up shop in Canada. Along with its existing operations in the USA and Mexico that means it can offer complete North American coverage, and its US and Canadian operations are working closely together. “They’ve partnered to create a regional fleet management solution that includes consolidated data and one-point-ofcontact account management which means we can provide our regional clients with an integrated service offering,” says LeasePlan USA chief sales and marketing officer, Jon Toups. The current rate of growth achieved by some emerging fleet markets should not be exaggerated warned Volkswagen AG head of international fleet sales, Martin Jahn, in a recent interview with IFW. “Fleet business is still small in India, and while we all have high hopes for China I have to say we are a bit disappointed
by the current level of development of fleet business there,” he observed.
How can leasing companies remain competitive? No matter whether they operate in Austria or Australia, a key question for many leasing companies is what sort of packages they will have to deliver over the next few years to attract and retain customers. Arval is attempting to cover all bases at present with the introduction of 60-month leases back in March and the subsequent launch at the other end of the time scale of what it refers to as Mid-Term Rental in selected markets such as France, Spain and the Netherlands. Still referred to as a lease, Mid-Term Rental is perhaps something of a misnomer given that the duration of the agreements written under it starts at as little as one month with a maximum of two years. The idea behind Mid-Term Rental is that it will aid businesses that have a short-term need for vehicles, possibly as the consequence of a seasonal surge in demand. It is a need that can also be satis ied by lexible long-term rental deals such as those offered by daily rental group Northgate in the UK. Arval is also looking at the increased provision of on-board telematics to lessees with an eye to persuading leet drivers to drive more responsibly. As a consequence they will hopefully burn less fuel, emit less CO2, in lict less wear and tear on their vehicles and have fewer accidents.
Mobility as a Service Lessors may have to start offering more alternatives to conventional leasing arrangements if Mobility as a Service (MaaS) starts to take hold, especially in urban areas. “It is arguably an idea that has already arrived via services such as car sharing and wider solutions involving multiple modes of transport booked through a single provider,” says KPMG’s Global Automotive Executive Survey 2014. “Respondents from the TRIAD nations (shorthand for North America, the European Union and Japan) are the most optimistic
In the first half of 2014, PSA Peugeot Citroën saw its unit sales rise by 28% in China.
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STRATEGY Operational Leasing
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about the potential for MaaS with a significant proportion forecasting that up to a quarter of city inhabitants will use these services by 2029 – a huge increase on the corresponding 2013 survey results,” it adds. The idea is less popular among the BRICs – Brazil, Russia, India and China – although they are not rejecting it entirely. “The likely penetration of MaaS in these key emerging markets is between 6% and 15% with the exception of Russia, where respondents have significantly higher expectations of the number of potential mobility customers in their country by 2029,” the survey observes. Hertz is among a number of major global rental groups expanding into MaaS, offering zero-emission and alternativefuel vehicles as well as car sharing as part of its Living Journey sustainability programme. Its latest move is to join Spain’s Zero Emissions Mobility to All (Zem2All) scheme under which it is offering Nissan's battery-powered LEAF for hire from selected locations in partnership with Spanish electricity and gas company Endesa. Not to be outdone, leasing and fleet management specialist Alphabet International, a division of BMW, offers a corporate car sharing programme under the AlphaCity banner as well as electric vehicles under its AlphaElectric branding. Now with approaching 540,000 vehicles of all makes on its books, Alphabet grew by 8% last year with especially strong growth in Germany, the UK and – despite its stagnant economy – France too.
European market to retain importance While Alphabet concedes that the demand for fleet management in countries such as China and Australia will expand over the next few years it is convinced that Europe will remain its most significant market for the foreseeable future. Operational leasing remains the cornerstone of Alphabet's business model but it recognises that there is increasing interest in flexible mobility solutions. “More and more of our customers are asking about them,” says Alphabet International head of marketing and business development, Carsten Kwirandt.
Car sharing and more In response the company has come up with Alphabet Mobility Budget, combining car sharing, cycling and public transport. It is now being offered in the Netherlands, and would seem to be an eminently practical solution for people living and working in cities such as Amsterdam, Rotterdam and Utrecht. “In the UK Daimler’s car2go point-to-point car-sharing scheme was successfully launched in parts of London and Birmingham in 2013 joining a number of other initiatives,” says John Leech, KPMG’s UK head of automotive. That success did not last however, with car2go pulling the plug on its British operation completely in May of this year citing the UK’s “strong culture and tradition of private vehicle ownership” as a key reason; evidence that car sharing is
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not quite the panacea its advocates suggest, although it seems highly doubtful that the UK is any more wedded to car ownership than the USA. Over there, upwards of 40,000 residents of Seattle alone have registered as car2go members.
Petrol, diesel or hybrid?
Despite all the interest in electric vehicles and hybrids, the odds are that most car acquisition packages will still revolve around the internal combustion engine, albeit in downsized form says the KPMG survey. Combustion engine optimisation and downsizing was a key issue for manufacturers to address, according to 76% of survey respondents. Engine downsizing is affecting light commercial manufacturers too. Also sold in rebadged guise as the Opel Vivaro, Renault’s new Tra ic panel van is equipped with a 1.6-litre diesel. Its predecessor was itted with a 2.0-litre. That is not to imply that vehicles powered by alternative fuels are unimportant; but it will be plug-in hybrids rather than pure electrics that will win out between now and 2019 the survey suggests. “Plug-ins are becoming the dominant e-technology and are expected to take an increasing market share in future,” says KPMG global head of automotive, Mathieu Meyer. September will see the launch by Mercedes-Benz of the S 500 Plug-in Hybrid. It will be capable of travelling 33km on battery power alone says the manufacturer and users will be able to recharge it using wireless technology; Daimler and BMW have agreed jointly to develop and implement a single common technology for wireless recharging.
Autonomous driving Another technological development – the driverless vehicle – could potentially make the need to acquire cars either outright or subject to a lease deal redundant in the long run. “The ability to order a car, have it arrive whenever you want it then have it take you wherever you want to go may make it unnecessary for you to actually own it,” Leech observes. Developing the driverless car and getting it into production may end up looking like the easy bit in a few years time. Devising a suitable regulatory framework plus insurance and funding packages to underpin its use could turn out to be a lot harder.
MANAGEMENT Leasing
Silverservice Arval celebrated 25 years in the leasing industry last month with the launch of several new customer solutions in Paris. To mark its anniversary, Arval is extending its leasing offering, simplifying its fleet management solutions and standardising its strategic offering worldwide, as Katie Beck reports… Mid-Term Rental Having launched its very-long-term offer – 60 month contracts in March, Arval is now deploying a medium-term lease offer to France, the UK, Spain and the Netherlands, with plans to roll out the offering to other territories on a country-bycountry basis. Arval’s new Mid-Term Rental solution covers contracts from one month to two years in length, and is designed to offer businesses seeking a lexible agreement a viable alternative. Arval believes the offering will be particularly popular with SME businesses, as Philippe Bismut, the organisation’s CEO, explains: “The way work labour is organised is changing as more and more people are self employed, or employed on a contract basis, so we need to be able to address this emerging movement. We believe that with our SME proposition and Mid-Term proposition combined together, we can address this trend.” “I think we are in a position where we can create new partnerships in the market by offering a new level of lexibility,” adds Philippe Noubel, Deputy CEO of Arval. “There is a grey area between three months and two years, so as you have noticed we have addressed that grey area with our proposal for one month to two years, which means that we intend to work in close partnership with the short term rental solution for the shorter part of the product. “We have also expanded into the UK, The Netherlands, and Italy next year. So the idea is to provide cars for companies that need more specialist lengths for rental agreements.” When pressed on the expected take-up for the new offering, Arval was understandably cautious, although Noubel suggested that leasing 10,000 cars in three years under the MidTerm rental agreement would be a “good result” for the brand.
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At the top Arval’s CEO, Philippe Bismut.
“Arval is an organisation that is customer orientated, and by standardising solutions you can provide an offering that is simpler, cheaper, more efficient and higher quality.” Philippe Noubel, Deputy CEO of Arval
Telematics Arval is also looking to increase its onboard telematics offering, with the aim of providing leets with an up-tothe minute overview of driver activity and encourage employees to behave more responsibly on the road. Following on from the Arval Smart Experience launched in France in 2013, which offers interactive multimedia tools and is currently being deployed in all group countries, telematics has become a strategic topic for Arval over the past two years. The company has invested in several of its international operations over recent years, using them as laboratories to test different telematicsbased solutions. “Our offering aims to, irst of all, provide real-time information about the way the vehicle behaves or where it is located in order to provide shortterm services, for example the need for an urgent repair or detecting automatically the location of the nearest suitable service point,” Bismut explains. “The second use is to monitor permanently the behaviour of the vehicle to ind trends about the way it is used, and ways this behaviour could be improved to achieve best value for money and improve safety, and generally speaking, reduce the risk to the asset. We genuinely believe this is an opportunity for us to improve our service proposition for leet managers.” The telematics solution will be launched in all territories by the end of the year in a primary format that will include components such as antitheft, real-time location and fuel consumption monitoring. The full service, including leet report functionality, is expected to be operational within 18 months. Driver Solutions Designed to help leet managers cope with the increasingly diverse demands of their jobs, Arval’s Driver Solutions offers a catalogue of uniformly struc-
tured products and services in the form of packages, with the option to add additional services as required. Now available in Arval’s main markets, Driver Solutions aims to take care of the day-to-day direct relationship with drivers, and offer leet management solutions to help tackle administrative tasks and support the management of leets in the ield. Each Arval subsidiary will devise its own packages according to the local needs of its customers, and basic standards will be monitored by the One Arval misison to maintain operational excellence: “Arval is an organisation that is customer orientated, and by standardising solutions you can provide an offering that is simpler, cheaper, more ef icient and higher quality,” Noubel says. New challenges So, with a quarter of a century’s worth of experience now behind it, what’s next for Arval and are there any regions that have the potential to be the next operational centre? “Organic growth in our existing geographies, for the foreseeable future, is our number one focus,” Bismut explains. “However, BRIC territories, particularly China, offer absolutely huge potential. Of course, there are new markets that we could consider entering and that is something we review regularly to make sure that the market has the potential, the maturity, and that we could manage it internally also. There also needs to be a used car market that is fluid enough to make this proposition viable. “Those are the prerequisites for the full-service proposition to enter the market. We believe there are a few markets that combine this, for example in Latin America we could probably identify a few countries, and Latin America is probably the next new frontier for Arval.”
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FEATURE Eco Driving
Transit Eco Marathon What fuel consumption can you expect from a new Ford Transit 2-tonne ECOnetic? John Kendall drove over 2,000km to find out.
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ord recently launched the new Transit “2-tonne”, replacing the large Transit van irst launched in 2000 and updated in 2006. The new Transit 2-tonne ECOnetic offers EU combined fuel consumption of 6.9l/100km, with CO2 emissions of 179g/km. How close could we get to that over a route of around 2,000km? A furniture collection and delivery to the west of Ireland gave us an opportunity to ind out. Low emission ECOnetic Fuel consumption is a priority for most fleets and like its predecessor, the latest Transit ECOnetic offers a range of fuel consumption reduction technologies. Acceleration Control, first launched on the Transit Custom, limits acceleration to that of a 50% loaded van. Others include engine Stop/Start, smart regenerative charging and Ford’s battery management system. Then there’s an “ECO”mode – which is activated automatically but can be switched off by the driver. This limits top speed to 110km/h, helping to cut motorway fuel consumption. European Transits are powered by versions of the existing Transit 2.2-litre diesel engine, driving either front or rear wheels through a six-speed gearbox. Sister publication VAN Fleet World is currently running a Transit ECOnetic. The 125hp 350 L3 H2 front-wheel-drive model features UK base speci ication. That means electric windows, but manual adjustment for the large door mirrors, remote central deadlocking and a full-steel bulkhead. Other equipment includes an adjustable driver’s seat, reach and rake adjustable steering column, storage space under the dual
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passenger seat, Bluetooth enabled radio with USB connectivity and remote controls. The route Starting from Bath in the UK, I drove 132km south to Hayling Island near Portsmouth for the first collection. From there, I headed 351km north east to Hingham in Norfolk, where I collected more furniture and a second driver. The final stage on day 1 was a 221km drive to Banbury to collect more furniture and a third driver. From here we set off 365km north, early on day 2 for the Stena Line fast ferry to Dublin from Holyhead in north-west Wales. Then on arrival in Dublin, we crossed Ireland to our inal destination near Clifden in County Galway, some 317km away. For the return journey, we reversed our route across Ireland and back to Banbury, before I returned the van to the Van Fleet World offices at St Albans north of London, the following day. Altogether we covered 2,173km on road. Loading The Transit’s side loading door, standard in UK speci ication, is wide enough to load a Europallet and the load area is 1,784mm wide at the widest point, able to accommodate two Europallets side by side. Ford has moved most of the substantial tie-down eyes from the loor to the body sides. Our mixed load came nowhere near challenging the Transit’s 1,479kg payload. The relocated lashing points proved their worth, ensuring the strapped down load didn’t move for the entire journey and making it easier to slide items across the load loor.
On the road... The latest Transit is not alone in demonstrating low engine noise levels, but it makes a big difference on a long journey like this. Exploring the economy potential of the van meant we used the default “ECO” setting. Acceleration control and the gear change indicator helped us to make the best use of the Transit’s 350Nm of torque between 1,450 and 2,000rpm. The high sixth gear gives under 2,000rpm at the limited speed.
“Fuel consumption is a priority for most fleets and Transit ECOnetic offers a range of fuel saving technologies.”
OUTBOUND Day 1 Day 1 proved to be the hottest day of the year to date in the UK with temperatures reaching an indicated 30°C. Air conditioning would have helped, but with just me in the cab, it was tolerable. With three aboard, the centre passenger could do with a bit more legroom, but regular driver changes made sure no-one sat in the middle for too long. Our route to Hayling Island is half motorway, while to Norfolk it is mostly motorway and fast road. A serious accident on the A11 in Suffolk brought traf ic to a standstill while the road was closed. Fortunately, by the time we had loaded up at Hingham, the road had been re-opened in our direction. This and traffic delays on the M25 around London slowed our progress and it was 5:00pm before we left Hingham for Banbury. With no motorway on our route and a good proportion of single carriageway road, it helped to keep our fuel consumption down, finishing the day after 689km with an average of 7.2l/100km, a good result, considering the windy conditions in the afternoon and evening.
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FEATURE Eco Driving
Transit Eco Marathon ¡
Day 2 We were up early to make the 10:30am Stena Line crossing from Holyhead. Today would not be so kind to fuel consumption. Having joined the M40 motorway north, the rest of the UK route was motorway followed by fast roads all the way to the ferry terminal. By the Knutsford Service Area in Cheshire on the M6 motorway, fuel consumption had dropped back to 7.7l/100km. Rain later did little to help and we reached the ferry terminal in good time. The last time we would be able to say that on this trip! The sea crossing was near perfect, ensuring that we docked on time. Getting through Dublin and heading west used to be a real challenge, because of the almost complete lack of signposts and the lack of good roads. Ireland did not have a motorway network 10 years ago. Not any more. Regular signposts in Dublin lead to the M50 motorway and out to the new motorway network. Then, it’s motorway and fast roads all the way to Galway city. It’s a different story west of Galway. Here the narrow, single carriageway N59 threads between mountain and lake – a spectacular sight in the prevailing good weather. By 6:00pm we were at our destination overlooking the Atlantic Ocean on a warm summer’s evening. 1,392km and fuel consumption had slipped back to 8.4l/100km.
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RETURN Day 1 It started so well, with a relaxed drive towards Galway in fine weather. It was only as we approached the city that I realised I had misread the ferry departure time. We were going to miss it. A hasty call to the Stena Line office in Dublin brought more bad news. The next crossing, from Dublin port was full and we would have to wait until 8:30pm for the next crossing. That meant a midnight arrival at Holyhead and a 4:00am arrival at Banbury. The upside of our late arrival in Wales was that the roads were clear, traf ic building gradually as we travelled further south, with a steady line of trucks on the M6. The sky lightened as we approached Banbury and we arrived as dawn was taking hold. Day 2 The return to St Albans, via a meeting in Luton seemed a bit quiet. 2,173km at an average of 8.4l/100km may be short of the claimed fuel figures, but the van was new, with less than 2,000km on the clock at the start. The amount of motorway driving also worked against better fuel economy and those on more mixed driving cycles should expect better. What did my co-drivers think? They were both impressed by the all-round visibility from the large door mirrors with the wide-angle lower sections. They were also impressed with the low engine noise levels, comfortable seats and generous storage. Ride comfort also scored well. We all agreed air conditioning would have been welcome as well as more legroom for the middle passenger, but overall, the 2-tonne Transit has made a good start.
REMARKETING Brazil
Used car sales boom Autorola Brazil’s country manager, Marly Fialho Kierulf, looks at how the used vehicle market is booming, supported by an acceptance of online buying and selling.
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s the World Cup came to a close in Brazil, the country’s overall car market continued to develop, although new car sales have been no more impressive than the national team’s World Cup performance. The new car market has been buoyant in previous years, although it was down -10.2% from January to June 2014, compared with 2013. Perhaps the World Cup drew Brazilians away from car buying in June as the monthly data showed new car sales down -19.3%, compared with June 2013. In fact it was the worst June sales performance since 2010, according to website, focus2move. At the same time, the used market has continued to go from strength to strength. In the first five months of 2014 the number of used car transactions grew year on year by 6.2% to 5.1 million vehicles. This figure includes cars, light commercials, heavy trucks and motorcycles. One of the main reasons for growth is the improved access to finance being offered by Brazilian banks, aided by more sophisticated valuation data being made available when they underwrite a finance agreement. A number of providers now offer future used vehicle market valuation data and with used prices generally quite strong, pre-owned vehicles have become affordable on finance. Brazil comprises a market of around 200 million people, of which around 90 million is an emerging class of people who consider owning a car as giving them a higher status in society. This emerging class cannot afford to buy a new car and is
not eligible to finance a new one; therefore a used vehicle is the preferred choice. Industry statistics from Fenauto estimate that 40 million people already own a used car, which gives some idea of the size and potential of the Brazilian car market. The young and dynamic nature of the automotive industry has meant an immediate acceptance to buying or selling a vehicle online. Currently around 40-50% of cars from the corporate sector are being sold online compared to 50-60% of private cars, with industry experts expecting this to continue to grow. Autorola is set to bring a much more sophisticated transactional platform to the online sector with payment protection for the buyer and real time bidding that has been innovated from 13 years of systems development. “Autorola has worked in relatively young and fast growing car markets before and there is an immediate acceptance of online trading,” explained Marly Filaho, Autorola Brazil’s country manager. “Both buyers and sellers are content to use online, particularly those who are based in cities like Sao Paulo where driving to a meeting or visiting a physical auction a few miles away could take the best part of the day. “Brazil’s road and traffic management infrastructure has not kept pace with its population or economic growth so online buying and selling works across many industry sectors,” she added.
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RVs
Analysing leasing and residual value confidence in the Eurozone and beyond...
Rental rates fall Prices are coming down for fleet operators across Europe, with rental rates falling over the last 12 months according to Experteye.
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ompanies operating vehicle fleets in Italy have enjoyed the biggest saving, with rentals reducing by -4.8% since July 2013. In Portugal prices have dropped by -3.6%, in France and Spain they have come down by -1.6%, Germany -0.5% and the UK -0.4%. In the last quarter (since April 2014), prices have continued to fall in Italy, where there has been a -3.7% reduction, France (-2.3%), Portugal (-1.3%) and Germany (-0.6%), however rates in the UK remain unchanged in the last three months and in Spain they have crept up by +0.2%. The figures come from the Experteye European Leasing index survey, which tracks forecasted residual values (RV), servicing, maintenance and repair (SMR) costs and rental rates in six European countries using data supplied by major leasing companies. One eye-catching statistic is in Italy, where SMR budgets have fallen by a staggering -13% in the last year, and -7.1% for the quarter. Portugal has also seen a -6.7% drop in the servicing, maintenance and repair costs included in contract hire rentals in the last year, albeit the picture is relatively stable across the other nations surveyed.
Market summaries – 3 and 12 months to June 2014
FRANCE: French rental prices have dropped by -2.3% in the last quarter, following a year that saw a -1.6% saving for fleet operators. Residual value forecasts are fairly static, with a -0.1% reduction for the year and a -1% fall in the last three months. Servicing, maintenance and repair budgets went up by +1.3% in the last 12 months, and +0.1% since April 2014. GERMANY: Residual value forecasts improved by +2.2% in Germany last year, with a +0.9% rise since April 2014. SMR budgets went up by +0.2% in the last 3 months, following a year that saw them come down by -3%. Rental rates fell by -0.5% for the year and -0.6% for the quarter. ITALY: In Italy, SMR budgets have plummeted by an incredible -13% since July 2013; by far the biggest drop in SMR budgets across Europe. In the latest quarter they have come down by -7.1%, and with a +1.6% increase in annual RV forecasts, and a +1.9% rise since April, it comes as little surprise to see rental rates fall by the largest margin of all nations surveyed (-4.8% in the last year and -3.7% for the quarter). PORTUGAL: Portuguese SMR budgets are down by -6.7% in the last 12 months, although this has steadied to a smaller -1.3% reduction since April. Residual value forecasts have seen very little change, with a -0.1% shift since last July and no movement at all this quarter (0%). With a -3.6% fall in rental prices during the last year, Portuguese leet operators have enjoyed the second strongest price savings in the Experteye survey, and there has been a -1.3% reduction in the last quarter. SPAIN: SMR budgets are up by +2.7% in the last quarter, and by +1.6% for the year. This places Spain as reporting the highest increase in the servicing, maintenance and repair element of its contract hire rentals of all nations surveyed. Residual value forecasts are up by +2.5% since July 2013, and by +1% since April this year. After a year that saw rental prices come down by -1.6%, they crept up by +0.2% in the last quarter. UK: The UK is showing the greatest optimism in the future used vehicle market, with a +4.1% rise in residual value forecasts in the last 12 months; the largest across all nations surveyed. However, there has been a -2.9% downturn in RVs in the last quarter. SMR budgets remain relatively stable with a +0.5% increase for both the year and the quarter. Rental rates came down by -0.4% since July last year, and have remained unchanged for the quarter (0%).
CHANGES IN RV FORECASTS, SMR COST FORECASTS AND LEASE RENTALS Forecast Service, Maintenance Current Rental Rates and Repair Costs 3-month change 12-month change 3-month change 12-month change 3-month change 12-month change -1.0% -0.1% +0.1% +1.3% -2.3% -1.6% +0.9% +2.2% +0.2% -3.0% -0.6% -0.5% +1.9% +1.6% -7.1% -13.0% -3.7% -4.8% +0.0% -0.1% -1.3% -6.7% -1.3% -3.6% +1.0% +2.5% +2.7% +1.6% +0.2% -1.6% -2.9% +4.1% +0.5% +0.5% +0.0% -0.4% Forecast Residual Values
France Germany Italy Portugal Spain UK
Notes: • The comparisons are for vehicles with a contract duration of 36 months/90,000km. • Twelve-month comparisons show change since July 2013. • Three-month comparisons show change since April 2014.
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• Rental rate changes compare the rates in effect at the time of the survey with those in effect three or twelve months ago. • RV and SMR changes show the change in participating leasing companies’ forecasts of residual values and maintenance costs over the period.
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FLEET FOCUS Germany
Germany bounces back After a slow few years, the German fleet sector is picking up, reports John Kendall.
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t may be the fourth largest economy in the world, but Germany has been through a difficult time recently. Even so, this now appears to be a thing of the past. Peter Kainradl, managing director of White Clarke Group in Austria and Germany reports that; “The economy is back on a growth track, business confidence is at its highest since 2011; the DAX index of the 30 largest German companies closed above the enormously important 10,000 level for the first time in June and the MDAX index of the next 50 companies has been performing even better.”
Leasing: cars up, CVs down There are signs that the leasing sector showed a return to growth in Q1 2014 after a static period from 2011. In White Clarke’s recent Asset and Auto Finance Country Survey of Germany, data from the German national leasing association BDL, shows that at the end of 2013, cars and commercial vehicles accounted for 69% of leasing assets in Germany. According to the Association of Automobile Banks and Leasing Companies in Germany (AKA), new individual lease and financial contracts on cars grew 1% in 2013 to 557,950, while those on commercial vehicles fell -2% in the same period to 672,954. The total value of the new car leasing business was €10.85 billion and €19.25bn for commercial vehicles. According to the White Clarke survey, 78% of dealer customers in Germany use leasing or other finance deals instead of outright purchase, a proportion that has increased from 60% in 2009. Car registrations rise in 2014 According to data from the European Automobile Manufacturers Association (ACEA), registrations in Germany fell by -4.2% to 2,952,431 in 2013. Perhaps reflecting the upsurge in the economy, growth has returned in 2014 and ACEA data shows that for the first six months of the year, car registrations grew by 2.4% to 1,538,268, which suggests a full year market exceeding three million registrations this year. Volkswagen remains the best selling brand in Germany, while the Volkswagen Group is also the best selling in Europe. It’s perhaps not surprising that the success of Volkswagen and its related brands is reflected in the business car sector. “The Volkswagen brand has the biggest market share, both in the market overall and in the commercial and fleet sector,” says the CEO of Alphabet Germany, Marco Lessacher.
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German brands dominate “In the company car market 80% of the German fleet total distributes among the German brands Audi, BMW, Ford, Mercedes, Opel and Volkswagen. As Ford and Opel have major sites in Germany they are perceived as German brands as well,” reports LeasePlan. “In Germany the German automotive manufacturers absolutely dominate the market. Import brands hardly play a role.” Karsten Rösel, general manager at ALD Germany adds, “I would say there is a dominance of the Volkswagen Group, including Audi, Skoda, SEAT, Volkswagen.” He has a different view from LeasePlan regarding imported models; “Overall, I would say the importers are doing a pretty good job here. We have two brands that have recovered very strongly, Ford and to some extent Opel. Hyundai is growing and also Toyota. What is also interesting is that other brands are now seriously trying to enter the German market. Mainly In initi, also Hyundai with the Genesis, then Maserati with the Ghibli. For a long time we have not seen movement in this segment and now there is really a variety of cars. Ford is coming in with this full-size SUV. The importers are coming back to the high-end segment. The times for 5 Series, A6 and E-Class are getting a bit tougher.” Leasing growth expected There seems general agreement on the size of the business car market. “Passenger car registrations in the commercial and fleet segments amount to about 680,000 units per year. In 2013, passenger car registrations in the sector were 653,000 vehicles,” says Marco Lessacher of Alphabet. Karsten Rösel reckons that about 25% of the annual new passenger car sales are what he would describe as “true fleet.” “The German market as such is driven by lots of what we call ‘artificial’ registrations,” he says. “Of course it’s real registrations but big volumes of registrations are done through dealers, car manufacturers, car rental companies. That’s a big volume of the market that to some extent is cannibalising the true fleet registrations because you have the first registration on a dealer or a manufacturer. Then the used car, a nearly new car is sold. It’s not counted as a registration, it’s then counted as a used car.” These cars may be just one day old before they are sold again. “This is also to some extent influencing new car registrations in the fleet business, especially the smaller commercials. They like to go for bargains at the dealers and try to
get one of these heavily discounted almost new cars,” he reckons. He estimates the true fleet new registrations at around 650,000 to 700,000 a year, of which German manufacturers take around 500,000. C&D segment popular, SUVs rising Not surprisingly, diesel engines are popular among fleet drivers of both cars and light commercial vehicles. Among passenger cars, saloon cars and station wagons are especially popular, says LeasePlan. The company reckons that together these body styles contribute to a share of over 90% of company cars. “When it comes to body style, estate cars command the biggest share for business use,” says Marco Lessacher of Alphabet. “The best thing is a car with huge horsepower and very low consumption!” says Karsten Rösel of ALD. Most customers choose either C or D-segment models, typically Volkswagen Golf, Opel Astra, Ford Focus or Ford Mondeo, BMW 3 Series, Audi A4, Opel Insignia, Mercedes-Benz C-Class. He also notes popularity for mid-sized SUVs among drivers who don’t cover much distance on the Autobahn network. Popular amongst these, says Karsten, is the Hyundai Santa Fe; “A car that no-one had counted on but is selling very well.” The Ford Ranger pickup is also a popular choice, he reckons. German brands strong in light CV Predictably, the light CV segment is smaller. “Some 240,000 light commercial vehicles are registered in the
commercial and leet segments per year. Out of those, approximately 180,000 are registered as ‘commercial vehicles’ with the remainder being regarded as ‘passenger cars.’ “Volkswagen is the strongest brand with Mercedes being in second place. The two manufacturers make up half of the registrations,” says Marco Lessacher of Alphabet. LeasePlan reckons 1.7m light CVs were registered in 2013, with Ford, Citroën, Mercedes and Volkswagen among the popular brands. High leasing levels in large fleets As we’ve indicated, leasing is a popular option in Germany. “About 60% of all business vehicles are financed by leasing. In the big fleet segment the share is significantly higher. Generally it can be said that, the bigger a company is, the more leasing as a financing method is preferred. The full-service-leasing share for big fleets is about 75%,” reckons LeasePlan. “Three out of four passenger cars sold in the commercial and fleet segments are financed by operational lease contract.” Karsten Rösel reckons about 60% will be leased in 2014; “Because the interest rate is so low.” He also sees a trend to full service leasing among smaller companies. For the future, LeasePlan expects steady annual growth. “Analysing the market development continuously we expect an annual growth rate of 1.5% of the mature German fleet market. We see growth potential especially in the small fleets segment, in the segment of civil service fleets, that has special needs, as well as in the non leasing friendly segment.”
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NAFA International Fleet Academy
Reducing Total Cost of Ownership Reproduced with the kind permission of NAFA Fleet Management Association, this is the latest in a series of extracts from the International Fleet Academy Global Fleet Guide. CHAPTER 4
Global fleet and organisational strategy More global leet tenders are being issued and implemented than at any time in history, as multi-national companies look to reduce leet expenses. There is an increasing recognition that a properly managed leet can provide a competitive advantage by making employees and assets more productive. This chapter will provide an overview of some of the key points to consider to help improve the efficiency of international fleets.
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anaging vehicle leets spanning national and the development of the globalisation program to ensure that continental borders presents challenges all issues are brought to the table, and buy-in is achieved at beyond language and time zones. There are all levels. Value is also derived from a communications differences in regulations, privacy laws, accounting stanprogram that ensures that goals are understood and guidedards, cultures, business praclines are adhered to. tices, labour skills and technology levels. Employee Develop a comprehensive plan Increase expectations for vehicles may A comprehensive global fleet plan profit also differ. adapts, aligns, harmonises and Effective global leet managestandardises all aspects of the fleet ment can overcome many of operation to support the organisathese obstacles and reduce tion’s strategic goals. The fleet is a Total Cost of Ownership (TCO). business tool, and basic fleet Educate Characterised by the building Reduce management activities that Strategic personnel Emissions blocks of centralisation, improve fleet efficiency can support Goals harmonisation, and cost reduccorporate goals. tion, TCO can lead to success For each national or regional for both the leet operation and operation it is important to the corporation. maximise global potential in such areas as acquisition, maintenance, Enhance Aligning fleet with risk management, fuel management, Safety company goals tax and regulatory issues and corpoThrough baseline service stanrate image. dards, disparate global leets The best way to begin developing are being aligned with a singular mission focused on the plan is by looking at the most attractive inancing methsupporting the corporate strategic goals. In addition to ods and TCO in each operation. Having this information ready these higher-level corporate goals, the leet manager at the start helps to focus and de ine clear and deliverable must take into account the various lower-level decisionobjectives. A realistic set of objectives and strategies is then making departments involved with leet. developed by measuring the entire multi-national organisaNational or regional operations must contribute to tion and establishing benchmarks.
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“Evaluating and measuring risk, then developing strategies to control it, is more complex for global than national fleets.” Financing fleet Determining the best inancial approach for acquiring vehicles is as complicated as the number of countries that must be considered. Every country has different levels of business maturity and tax pros and cons that will impact your decisions. For instance, in the United Kingdom and Belgium, tax on company cars is based on CO2 emissions; France charges on fringe bene its and payment of corporate tax to the government; and The Netherlands places a luxury purchase tax on every new passenger car as a percentage of the list price. Customary methods of payment and inancing also vary widely. A mixture of inance leases, operating leases, or contract/hire are complemented by pure leases for Mexico, notated leases for Australia, and consecutive leases for New Zealand. Fleet policy must be detailed and cover a wide variety of information, including whether purchasing is permitted, the advantages and disadvantages of long-term rentals, how make and model availability differs from country to country and a vehicle selector list for the different occupational levels or budget/benchmarks per country.
Readers can review the full article – and much more – by purchasing the Global Guide through the NAFA website: www.nafa.org/
Global risk management The process of identifying, evaluating and measuring risk, then developing strategies to control it, is more complex for global than national leets. In addition to the typical concerns aligned with loss exposures faced by the organisation (property, liability, business income and personnel exposures), additional global risks include inancial or governmental collapse within a country, war, and corruption. Regardless of who is responsible for leet risk management (the leet department or the organisation’s risk management function), it is important to interact to identify additional risks by type, size, and frequency, then quantify their overall impact on the organisation and employ risk management techniques to minimise their impact on the organisation’s bottom line. Remarketing The topic of remarketing demands a thorough accounting, since the profit potential is so substantial and variations from country to country can be dramatic. Ongoing market analysis is essential to determine resale timing to achieve optimum residual values in each country or region. In some regions of the world, including most of Europe, remarketing is not an issue with which a leet manager needs to contend. This is because all leases are full service, closed calculation/operating type leases, so the risk of the residual value of the vehicle and the remarketing of that vehicle remains with the leasing company. When remarketing is the leet manager’s responsibility, however, it is more critical than ever to attain the maximum possible return. The North American leet manager should be aware that most parts of the world have limited market access and size. This can make offshore disposal of a large number of vehicles problematic and result in lower resale values. Staggering leet remarketing efforts to avoid looding a small market is one way to address this problem.
Next month... We look more closely at how to implement a global fleet strategy, and how to monitor the efficiency of an operation.
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PROFILE Lexus
“94% of all Lexus models sold in Western Europe last year were hybrid variants.”
Hybrid success story Few brands can claim to have entered the cultural lexicon as a synonym for luxury, but Lexus has managed just that. With popularity of its hybrid-drivetrain soaring in Europe and a targeted approach to international growth, Lexus hopes to see its profile rise still higher this year…
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view
Manufacturer Lexus Total sales 2013 523,277 Headquarters Nagoya, Japan Global market share 0.63% No. of models 9
from the top
IS 300h boosts European sales...
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exus’ premium petrol and hybrid-powered vehicles are now exported to over 70 territories worldwide, including Europe, Asia, Latin America and the newly rich nations of the Middle East – a territory that is fast becoming a key sales region for the brand. Recording 273,849 total sales in 2013, the USA remains Lexus’ dominant market, demonstrating the brand’s continued commitment to surpassing the expectations of American consumers (opinions differ, but the Lexus name supposedly comes from Luxury EXport US). The Lexus brand functions as a true status symbol in the USA, with celebrity owners including Steven Spielberg and Harrison Ford helping to perpetuate the manufacturer’s aspirational image of style and re inement. Recording 103,920 total sales in 2013, the RX 400h/450h SUV remained the top-selling Lexus model in the US market, while the IS compact executive sedan made strong gains with a +26.4% uplift over 2012 figures despite the new model launching during the summer. Engine options include rear-wheel and allwheel drive for the IS 250 and IS 350, and early indicators suggest a healthy uptake of the new marque. Currently Lexus has no plans to launch the IS 300h hybrid variant to the US market, focusing instead on its conventional petrolpowered offerings. In contrast, low-carbon alternatively fuelled vehicles tend to perform well in Europe due to tax incentives, and 94% of all Lexus models sold in Western Europe last year were hybrid variants. Its European presence has been fuelled by the addition of a four-cylinder 300h hybrid drivetrain, engineered for the region and introduced with the new IS. Lexus sold 7,562 IS sedans in Europe last year, tripling 2012's sales figure, and an incredible 5,984 (79%) featured the 300h drivetrain. The larger GS 300h, which launched at the end of the year, is also showing strong demand. Lexus retained its position as the number one luxury automotive brand in the Middle East last year, recording growth of 19% to 37,284 units. In contrast to its strong sales success in Europe, however, the new IS accounted for just 1,864 units, with Lexus’ entry-level sedan being outsold by the more luxurious LS, which increased 55% to 2,171 units sold. Domestic sales accounted for 46,742 units last year, with the launch of the new sedan boosting IS sales igures by +463% to become the brand’s best-seller in Japan, overtaking the LS. Lexus’ pursuit of to the Chinese market has been relatively subdued in comparison to other manufacturers, though Dirk De Man, general manager for Lexus’ sales operation in Europe, hinted to IFW that this may be about to change: “In 2013 our sales increased by 13% in China, and the irst half of this year the pace is even faster (+18%). There is a growing appetite of Chinese customers for our fuel-ef icient hybrid vehicles. So we see a great potential for the future.”
LEXUS Global sales, by territory Territory USA Canada Europe Japan Middle East Total
2013 273,849 15,949 43,281 46,742 37,284 523,277
2012 244,166 15,101 45,610 43,655 31,288 470,949
% change + 11% +5% -5% +7% +16% +10%
Dirk De Man, sales operations and network general manager at Lexus Europe, reveals where Lexus’ fleet proposition is particularly strong, and how the brand aims to capture sales with forthcoming NX. Where does Lexus perform most strongly in fleet in Europe? Our top markets in Europe in terms of leet sales are The Netherlands, where four out of ive Lexus go to B2B customers, and Poland and Belgium, where the proportion is at 75%. On average in Europe, B2B sales represent 60% of our sales. What makes the forthcoming NX stand out? We’ve given the NX a unique personality and positioning in the segment, combining an outspoken and edgy design with great functionality, numerous innovative technologies and of course very ef icient powertrains. The hybrid NX 300h is clearly leading the segment with CO2 emissions starting at 116g and total system output at 197 DIN hp. What share of the RC and NX models will take the four-cylinder hybrid in Europe? The NX 300h will represent more than 80% of sales in Europe as a whole, and we also aim at attracting about 80% of customers new to Lexus. Within the RC range, the proportion will be about two-thirds hybrid. What sorts of fleets are drawn to Lexus, and why do you think that is? We currently have a large share of small and medium-sized companies and self-employed customers. These type of customers are drawn to Lexus hybrid vehicles by three main drivers: the desire to choose vehicles that are clearly different from the others, the smooth and re ined driving experience, and of course the low costs of ownership, resulting from the high durability of the hybrid system and the lower replacement rate of some parts.
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PROFILE Lexus
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Where are they made?
6
5
4
3
1 2
Manufacturing plant locations
FIN fleet in numbers
60% Percentage of Lexus models sold in Europe that are B2B.
2005 The year that dealerships under the Lexus name were first seen in Japan.
116g/km Targeted CO2 emissions for the forthcoming NX 300h.
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1
Tahara, Japan – LS, GS, IS, GX
2
Kyushu, Japan – CT, HS, RX
3
Motomachi, Yokohama, Japan – LFA
4
Toyota City, Tsutsumi, Japan – LX
5
Susono, Japan – SC
6
Cambridge, Ontario, Canada – RX
New Lexus NX
NX 300h poised for launch...
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he NX luxury compact crossover launches to the European market in October 2014, representing Lexus’ irst foray into the hybrid crossover segment. It takes the carmaker into the growing and leet-heavy premium crossover sector, aiming to conquest sales from the similarly sized BMW X3 and Audi Q5, as well as smaller vehicles such as the Range Rover Evoque and Mercedes-Benz GLA. The NX 300h will be available with two and four-wheel drive. It uses the same 2.5-litre, four-cylinder petrol engine as the new IS and GS 300h, while the fourwheel drive system is the same as the RX 450h, using an additional electric motor to drive the rear wheels rather than a direct mechanical connection. Targeted CO2 emissions are less than 116g/km and over 5.2l/100km for the most ef icient model, and Lexus will use the same range structure as all of its latest models, starting with a launch price of €23,400 for the two-wheel drive S grade and rising to €34,000 for the Premier trim level, with four-wheel drive as standard. The 200t variant will launch to the US market in winter 2015, and, according to Dirk De Man of Lexus Europe, could hint at a growing role for small, ef icient engines for the brand; “The NX 200t features Lexus’ irst turbo engine. Developed in-house, this smooth and ef icient engine is a welcome addition in several European countries where there’s potential for a more performance-oriented model. We consider including this power train in other Lexus models in the future,” he said. Also available from autumn this year is the IS-based RC coupe, which made its European debut at the Geneva Motor Show in March. Aiming to take sales from rivals including the Audi A5, BMW 4 Series Coupe and Mercedes-Benz C-Class Coupe, drivetrains will include the 300h four-cylinder hybrid likely to account for the bulk of European sales, and possibly the 200t petrol turbo. As a halo model, the RC F will be the most powerful V8 performance car the brand has ever developed. It is powered by a new 5.0-litre engine that’s expected to deliver well in excess of 450bhp and more than 520Nm of torque. This is married up with a newly calibrated eight-speed transmission with a world-first installation of a Torque Vectoring Differential in a front engine/rearwheel drive sports coupe.
LEXUS fleet model range
COMIN
G SO O N
!
CT
RC (from Q4 2014)
IS
Variants: 5dr hatchback Markets: Europe, Asia, Africa, North America, South America, Oceania Fuel: 3.6-4.1l/100km CO2: 82-94g/km
Variants: Coupe Markets: Europe, Asia, North America, South America, Oceania Fuel: TBA CO2: TBA
Variants: Compact executive Markets: Europe, Asia, Africa, North America, South America, Oceania Fuel: 4.3-9.7l/100km CO2: 99-225g/km
ES
GS
LS
Variants: Compact executive Markets: Europe, Asia, Africa, N.America, S.America, Oceania Fuel: 5.4-9.5l/100km CO2: 127-224g/km
Variants: Executive saloon Markets: Europe, Asia, Africa, North America, South America, Oceania Fuel: 4.7-10.2l/100km CO2: 109-237g/km
Variants: Luxury saloon Markets: Europe, Asia, Africa, North America, South America, Oceania Fuel: 8.6-11.6l/100km CO2: 199-268g/km
COMIN
G SO O N
!
NX (from October)
RX
Variants: Crossover Markets: Europe, Asia, North America, South America, Oceania Fuel: 5.2-5.4l/100km (TBC) CO2: 120-125g/km (TBC)
Variants: Crossover Markets: Europe, Asia, Africa, North America, South America, Oceania Fuel: 6.0-10.6l/100km CO2: 140-250g/km
GX
LX
Variants: SUV Markets: Europe, Asia, North America, South America Fuel: 12.8l/100km CO2: 303g/km
Variants: : Large SUV Markets: Europe, Asia, Africa, North America, South America, Oceania Fuel: 14.6l/100km CO2: 350g/km
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Mercedes-Benz C-Class Is the C-Class better than its predecessor? John Kendall finds out. SECTOR Compact executive PRICE €27,140–€35,700 FUEL 4.0–5.3l/100km CO2 103–123g/km
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diesel engine and an additional 27hp from the electric he latest evolution of the Mercedes-Benz C-Class motor. Mercedes claims 3.9l/100km fuel consumption for needed to be a very good car to better its predethis model. A second plug-in hybrid model will combine cessor, which won many friends in the fleet sector. a petrol engine and electric motor with extended electric Mercedes would not try to do anything less, and it range. Paired with the engines is either a six-speed manstarts with a programme of weight reduction resulting ual or seven-speed automatic. in weight savings of up to 100kg. Most of this comes in Steel suspension with a new four-link independent front the bodyshell, where the use of aluminium is said to system will be the standard arrangement and there is an have risen from under 10% to 50%. option of three selective damping systems with this setup. Engines all feature Mercedes Stop/Start system with Alternatively Mercedes claims the C-Class is the first car claimed fuel consumption reductions of up to 20% in its class to be offered with air suspension, with a range compared with the outgoing models. At launch the of settings from ‘Comfort’ to ‘Sport+’. engine range includes a 1.6-litre petrol, The system is also self-levelling to autopowering the C180, a 2.0-litre engine matically compensate for load. powering the C200 and a 2.2-litre As you might expect there is a long diesel in the C220. list of driver assistance options from Soon to come will be a Renaultsafety systems such as the BAS PLUS Nissan sourced 1.6-litre diesel engine Brake Assist system to a 360° view producing 115hp or 136hp, with camera. There are new airbags, a new 280Nm or 320Nm of torque respecair conditioning system and a new infotively. As it stands, the 170hp C220 tainment system that can become BlueTEC generates CO 2 emissions of Internet connected via a smartphone. 103g/km, so it seems reasonable to suggest that the 1.6-litre engine will Luckily the C-Class is still a very fine car to drive, with either the AMG packoffer sub-100g/km emissions. Addiage and seven-speed automatic and air tional power ratings will be added to the C220 diesel between 115hp and suspension or the more ‘basic’ manual Mercedes has produced models offering what you would hope 204hp and all use SCR emissions conan excellent successor from a Mercedes. There’s a high degree trol technology using the AdBlue addito the outgoing C-Class tive to reach Euro 6 emissions limits. of comfort, low levels of wind and road noise and impressive handling characThe BlueDIRECT petrol engines with great fleet appeal. teristics. You might need to keep a feature direct petrol injection and New engines and multiple injections as well as multiple watchful eye on the speedometer. I hybrid drivetrains found that it took little time to propel ignition. Still to come is a hybrid option will only add to this. the C220 diesel well past motorway with the diesel engine, to be the C300 speed limits. BlueTEC HYBRID with 204hp from the
what we think
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Fiat 500L Trekking Part 500, part crossover, the Trekking should prove popular, says Alex Grant. SECTOR Small crossover PRICE €20,650–€26,700 FUEL 4.2–7.0l/100km CO2 109–163g/km
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ith the B-SUV segment continuing to grow, Eurosimilarly to the basic 500L. It feels more top-heavy and lacks pean buyers opting en masse into crossover the agility of the MINI Countryman and Nissan Juke, but products, and a growing presence in North feels considerably more spacious inside than either thanks America, the 500L Trekking couldn’t have come sooner for to its high roofline. All of the MPV interior flexibility is carFiat’s compact MPV family. ried forward, too, such as the rear bench which slides, folds Positioned at the top of the range, the Trekking will and tumbles to create a low, flat load area to the tailgate. allow Fiat to take on the ever-popular Nissan Juke as well Drop the passenger seat and loads up to 2.4 metres in as its closest possible competitor, the MINI Countryman. length will fit inside, and the boot floor can be raised or Crossover styling suits the 500L better than the scaled-up lowered to create a compartment underneath. chrome accents used on its MPV sibling. Most of the body panThe 0.9-litre TwinAir, 1.4 16v and 1.4 T-Jet petrol and 1.3 els are shared between the two cars, but the rugged-looking MultiJet diesel engines are shared with the 500L, and 1.6-litre plastic body cladding, raised suspension MultiJet is likely to be the choice for Euroand snowflake-like alloy wheels wrapped pean fleets. It produces 105PS, in line with in Mud & Snow tyres give the Trekking a C-segment and B-SUV norms, and fuel much more purposeful appearance. consumption has risen slightly from But the €500 price increase, which 4.5l/100km in the 500L to 4.7l/100km in with a single trim puts it above many of the crossover. It’s not the quietest or livelithis segment’s entry-level models, doesest engine at this size, but real-world fuel n’t only cover a cosmetic makeover. The efficiency settles at around 5.1l/100km Trekking features a similar traction conand power output is ample. trol system to the Peugeot 2008 and Most desirable options are included. At 3008, and the Renault Scenic XMOD, the top of the range, the 500L Trekking’s which brakes the wheel with the least standard specification includes cruise grip and moves power to the opposite control, air conditioning and Fiat’s smartcorner on loose surfaces. phone-like Uconnect infotainment sysWith the raised suspension and all-seatem, albeit without satellite navigation. The styling will polarise son tyres, Traction+ should allow drivers Perhaps the only trick Fiat has missed opinions, but 500L to cope with most low-grip conditions the here is the lack of a multi-trim model offers the best qualities car should face, without the weight or fuel range, which would allow the crossover economy sacrifice of four-wheel drive. to come down in price a little. If segment of a small MPV and a Besides, as the front-wheel drive sales norms are anything to go by, the 500L crossover in a fuelbias in this sector illustrates, it’s crossover Trekking’s ability to meet the styling efficient package. An styling rather than off-road ability which tastes of European buyers could make it a important global model. customers tend to be seeking. bigger-selling model than the MPV in On tarmac, the 500L Trekking drives some countries.
what we think
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Citroën C4 Cactus Distinctive, clever and affordable, the C4 Cactus is Citroën at its best, reckons Alex Grant. SECTOR Lower medium PRICE €13,950–€24,170 FUEL 3.1–4.6l/100km CO2 82–107g/km
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n 1948, Citroën unveiled its vision of a car for postseller, offering range-best fuel economy of 91.1mpg. war France. Cheap to buy and run, durable yet lightAggressive pricing, low insurance, tax and maintenance weight, compact but capable of carrying four adults costs due to its minimal power and weight, are all comin comfort, the loveable 2CV sold 3.8 million units ponents of a targeted 20% reduction in whole-life costs through a 42-year life cycle. compared to the segment benchmark. It’s not a quick car, Citroën hasn’t officially made the link between the two, even with the excellent new PureTech 110 petrol, but but the C4 Cactus feels like a modern interpretation of with its soft ride quality and light steering it’s an easy, the same design brief. Functional, affordable and stylish, relaxing drive. this stands to breathe new life into the manufacturer’s The cabin feels tuned to this. It’s as stylish as the exterior, C-segment offering and should be useful for capturing making up for widespread use of hard plastics with details buyers out of the growing crossover market too. such as the slightly pearlescent finish on its all-digital dashThere’s no retro pastiche styling here, board, leather straps for door handles and but it doesn’t take long to find shared the huge glovebox styled to look like a DNA. Where the 2CV featured rippled travel case, which all stop it feeling cheap. metal panels to resist low-speed impacts Versions with the ETG6 clutchless without adding much weight, the C4 Cacmanual gearbox get the best looking tus uses air-filled plastic sections called interior, with two individual front seats Airbumps in vulnerable areas to achieve styled to look like a bench and gear the same. Soft suspension and a high ride selector buttons on the dashboard, but height are also common features. the transmission itself is sluggish and Ruthless weight reduction is also a jerky to use. Had Citroën adopted a common factor. So the platform is a 2CV-like dashboard-mounted gearstick stretched version of the DS3’s, rather for manual models, it could’ve avoided than the modular architecture used in cutting the bench in half. the C4 Picasso. Using pop-out rear winThe pop-out rear windows leave room dows, a single-piece folding backrest for large door bins, and the roof-mounted Characterful, affordable and an aluminium bonnet mean the front airbags allow a generous glovebox, cars are what Citroën entry-level car weighs 965kg – 200kg but there's a high load lip under the taildoes best, and the C4 lighter than the equivalent C3. gate and the rear bench doesn’t fold easIt means Citroën has been able to align ily, or flat with the boot floor. Cactus is clever with it. engine options with smaller cars. There Citroën has hit the mark here, though. This deserves to be a real are four three-cylinder petrol engines Plentiful French design flair and a clever threat to the B-SUV and and two four-cylinder diesels to choose approach to saving money, make the C4 C-segment mainstream. from, and Citroën expects the Euro 6 Cactus as charming today as the 2CV compliant BlueHDI 100 to be the biggest was 66 years ago.
what we think
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Opel Astra 1.6 CDTi SRi Set to be core fleet choice, the ‘Whisper Diesel’ has plenty to shout about, says Alex Grant. SECTOR Lower medium PRICE £20,640–£26,700 FUEL 3.7–3.9l/100km CO2 97–104g/km
O
further improvements in the near future. pel has been subtly but effectively updating its CO2 emissions of less than 95g/km, at least for the core models for over a year now, and the Astra is 110PS version, would certainly be helpful with PSA’s the latest to get a small but important upgrade for Euro 6 compliant BlueHDI 120 offering more power its fleet presence, in the form of a new Euro 6 compliant (120hp) and CO2 emissions from 82g/km in the Astra1.6-litre diesel engine. rivalling Peugeot 308. Even the larger Insignia isn’t far off The 1.6 CDTi replaces GM’s long-running, hard-wearthe Astra, with 2.0 CDTi versions now down to 98g/km. ing 1.7-litre diesel range. So this single engine, which is But refinement is impressive for a small engine. GM already available in the Zafira Tourer and Meriva, and is calls this the ‘Whisper Diesel’ and, even from cold, it lives likely to be powering the Insignia in the near future, up to its nickname. There’s a barely audible whirr, but stands to be a staple of Opel’s future fleet presence. almost no rattle even when idling and the engine is pracIt’s a thoroughly modern unit, too. Opel has used a varitically silent while driving. It’s a huge able vane turbocharger to offer smooth change from the 1.7 CDTi, which was and progressive power delivery, a far from a noisy engine, but was startnew multiple injection common rail ing to fall behind rivals on NVH. system for a more efficient combustion Power delivery is strong and, even in cycle and fitted a NOx trap in the the more powerful version, it lacks a exhaust to meet Euro 6 requirements. mid-range spike which some downThe six-speed gearbox is also new. sized engines can suffer from. While Like its predecessor, the 1.6 CDTi the claimed economy isn’t the best in is available in two power outputs – this class, Opel has form for coming with 110hp and 136hp – and headline close to its published figures in realfuel economy figures have improved world use and a 1.6-litre engine is neiwith it. Likely to be the fleet ther overpowered nor overwhelmed in engine of choice, the 110PS version a car of this size, which should help. emits 97g/km CO 2 and consumes It’s also worth remembering that this 3.7l/100km, marginally less than the Refined and powerful, generation of Astra is close to retirement. 99g/km of the equivalent 1.7 CDTi. the 1.6 CDTi is a delight Spy shots have already shown its replaceUnfortunately, this wasn’t available to use, but Opel needs ment being tested under heavy camouto test. Instead, we spent some time flage, rumoured to launch during 2015. with the 136hp unit which, in its most to target further So while improvements to fuel economy efficient form, consumes 3.9l/100km reductions in CO2 are minor in this car, expect the Whisper and emits 104g/km CO 2. That’s and fuel consumption Diesel to have fuel economy to really actually slightly higher than the nearto stay ahead. shout about when it makes its way under est equivalent 1.7 CDTi, at 3.7l/100km the bonnet of this car’s replacement. and 99g/km, though Opel has hinted at
what we think
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The right to clean air Ross Durkin, Managing Editor, International Fleet World
Global Fleet Forum is International Fleet World’s new international network and digital forum, launched in March 2014. At the heart of the Global Fleet Forum is a team of fleet professionals who play a key role in the industry, either as fleet managers, consultants or fleet suppliers. These fleet experts provide a regular feed of information that is posted on the website forum in the form of discussion topics. Typical areas of interest include, but are not limited to: taxation, finance and accounting, legislation, environmental issues, fleet safety, insurance, fleet management, supply issues and security. Fleet suppliers are permitted to respond to queries if it is felt that their response represents honest and impartial advice. This aspect of the service is strictly moderated in order to ensure that the quality of information provided remains of the highest standard. We have already attracted a strong network of international fleet professionals, and our expert contributors have submitted a number of thought provoking discussion topics, a few of which are previewed to the right. We hope you will consider joining us in this exciting new venture into the world of fleet. To find out more about the Global Fleet Forum and request membership, please visit:
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There’s a saying in Britain that ‘it’s an ill wind that blows nobody good’. In other words, no matter how bad a situation appears to be, there’s going to be somebody somewhere that’s going to benefit in some obscure way. So news that the UK government is going to miss its target for nitrogen dioxide emissions in three major cities – London, Birmingham and Leeds – might appear to be bad news all round. But there’s no doubt that the case will give further ammunition to those who are arguing for tighter emissions rules in urban areas, especially the increased use of electric vehicles. You could argue that EVs use energy that was created in a coal or gas-fired power station. But at least this was probably well away from urban areas and thus far less harmful to health. Don’t be surprised if the electric vehicle manufacturers and their supporting lobbyists see this story as a good excuse to ramp up pressure on the UK government. Likewise, don’t be surprised if this little scene is played out in dozens of other European cities where emissions levels are equally high.
A fleet manager replied… It’s an interesting knock-on effect, of badly considered EU environmental policies. Focusing on low carbon vehicles, and incentivising them in the UK, has driven a much larger swing towards diesel sales. They’re great for reducing CO2 but disastrous for air quality, as anyone who has ever taken a deep breath in London will know. That’s a fire which has been further fanned by the lack of real-world benefits from systems designed to get around the Euro emissions regulations. Emissions Analytics and Imperial College London recently proved that plenty of Euro 5 cars aren’t meeting Euro 4 or even Euro 3 requirements on the road. Something which Euro 6 should help fix going forward, but it’s not enough. The problem is, we’ll still have a legacy of old ‘eco’ diesels which are fuel and tax efficient but are belching out all manner of unpleasant particulate matter and NOx – an issue that will take years to resolve.
debate...
in association with
Meet the experts... Ultimately, there’s still not enough being done to really promote switching to cars which are good for local air quality. Once diesel cars get under 75g/km CO2, they’ll be able to get into London again without paying the Congestion Charge. Why not limit this exemption to plug-ins, so drivers don’t have infrastructure worries when they leave the city limits? Perhaps even pure EVs to be really aggressive on air quality? Or why not follow the Norwegians’ lead, providing bus lane access during rush hours, plus extensive free or discounted parking and a charge when you get there – supplied by as much renewable energy as possible? If rapid change is needed, for health reasons, then it needs to become prohibitively expensive to take anything other than a 100% necessary ICE vehicle into towns and cities before people will take notice of the alternatives.
Food for thought… Natalie Middleton, Business Editor, International Fleet World New data released by Lytx Europe has found that eating and drinking while driving makes a driver 3.6 times more likely to be involved in a collision. This backs up research released earlier this year by UK road safety charity Brake in partnership with Direct Line, which found more than six in ten (62%) drivers have eaten at the wheel in the past year whilst one in 50 (2%) has narrowly avoided a crash in the past year as a result. It’s not an issue that’s going to go away but you could argue from the fleet point of view there’s not a lot you can do to prevent it, other than to make sure your fleet handbook spells out that this is not acceptable company practice. Of course, fleets can help play their part by ensuring that employees’ schedules aren’t so busy that they are forced to eat/drink whilst driving. And driver training can help drive home the need to avoid distractions too. But at the end of the day, surely there comes a point when we have to assume that our drivers, having passed their test and gone out and got a job, have enough sense to judge what is safe and what is not? Or is that never a given?
Peter Minchinton, Tax Specialist, Baker Tilly Peter joined Baker Tilly after leaving his role as senior consultant with Whitechapel, the employee car ownership arm of leading UK financial group, Lloyds TSB autolease. Prior to Whitechapel, Peter was an employment taxes specialist with multinational financial group PricewaterhouseCooper and Ersnt & Young. Peter also served as car benefit taxation team leader for Her Majesty’s Revenue and Customs (HMRC), advising on employee flexible benefits and expenses and salary sacrifice scheme design and implementation.
Martin Wilson, Fleet Director, Hyundai UK Martin has been fleet director of Hyundai UK since January 2013. His early career began at Lombard’s motor finance division in 1994, while still finding time to play as a contracted semi-professional rugby player for Newcastle Falcons. He moved to Jaguar in 1998, working up to corporate sales manager for Jaguar Land Rover. Martin moved to Hyundai in 2007, where he held several senior sales positions before being promoted to fleet director.
Steve Moody, Editor, Fleet World Steve has more than 15 years’ experience in fleet journalism. He has worked on a number of fleet publications and took over as editor of Fleet World in January 2010. A professionally trained journalist, he has an extensive knowledge of the motor industry around the world, which he combines with an in-depth understanding of how the fleet industry works and a highly effective network of fleet professional to provide information on key issues affecting the sector.
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fleet in figures
Renault makes strong European return China, North America and Western Europe are fuelling the growth in the global light vehicle market, while prospects look weak in Eastern Europe, reports John Kendall.
Renault Captur The Captur became the first small crossover to enter the top 10 sales chart in June, outselling the Nissan Qashqai.
Robust global sales Data for the first half (H1) of 2013 shows that global new light vehicle sales continued to grow. Data from LMC Automotive indicates that the global market remained above a seasonally adjusted 87 million units/year and that the improvements seen in China, the US, and Western Europe continued to offset weak performances in regions such as South America and Eastern Europe. The World Cup diverted buyers attention in Brazil, sending sales in Brazil and Argentina into a -19.5% decline in June
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compared with June 2013. LMCA predicts that sales will recover now the competition is over, but high inflation and tighter credit are having an effect. H1 2014 sales have fallen by -11.0% to 1,941,979 for the two countries.
US now recovered from recession LMCA reports that the light vehicle selling rate in the United States was close to 17m units/year and suggests this indicates that the market has now fully recovered from the 2009 recession. LMCA believes that it would be dif icult
to maintain this level of sales in H2 meaning that overall, 2014 is likely to close below 16.5m sales. H1 data shows the US market up 4.2% to 8,148,718, compared with 2013. The Canadian market also remains buoyant with H1 up 2.9% to 909,805 compared with 2013. The market appears to be on course for a full year total of 1.8m, says LMCA.
China emissions standard hits light CV sales The Chinese market climbed 9.9% in H1 according to LMCA, reaching
11,727,967 units in H1. LMCA suggests that the selling rate in June reached 24m units/year, similar to May. Although passenger vehicle sales remained strong, uncertainty surrounding the implementation of China’s IV emissions standards for light CVs has weakened demand. LMCA notes some monetary easing and mini fiscal stimulus measures may help to support the economy and vehicle sales, but falling property prices in many cities may cool consumer confidence.
Russia, Turkey and Ukraine slow Central and Eastern European growth In Eastern Europe, the economy and markets are suffering from the results of unrest in the Ukraine, which will not be helped by the recent Malaysia Airlines crash in the region, believed to have been caused by a missile strike. LMCA data shows that H1 light vehicle sales declined by -7% to 2,178,640 compared with 2013. Russia, Turkey and the Ukraine all remain weak according to LMCA. The increase in the consumption tax in Japan in April has not hit the market as hard as some expected. LMCA attributes this partly to back orders that were still eligible for the lower rate of tax. MINI vehicle sales, responsible for around 40% of the market in Japan, have continued to grow.
Western Europe gathers momentum The upward trend in Western European light vehicle sales continued in June, as EU car registrations increased by 4.5% compared with June 2013. This pushed June registrations to 1,189,143 in the 28 EU member states, but as the European Automobile Manufacturers Association (ACEA) points out, this is the second lowest level of registrations for June since ACEA started recording the data after the EU enlargement in 2003. H1 data shows that car registrations reached 6,622,996, a 6.5% increase on H1 2013. The only major EU market where registrations fell in June was Germany,
where registrations dipped by -1.9% to 277,614 compared with June 2013. As indicated in our pro ile of the German market on page 28 the overall trend for the German market is positive, with H1 registrations reaching 1,538,268 a 2.4% increase on H1 2013. Amongst the larger EU markets, registrations in Spain rose by 23.9% in June compared with June 2013 to 90,158, helped by a renewed scrappage scheme from the Spanish Government. This has helped Spanish registrations to rise by 17.8% in H1 to 454,942. The UK continues to see market growth, recording the biggest year to date increase in units sold in H1, according to JATO Dynamics. The UK market has risen by 10.6% to 1,287,265 compared with H1 2013. Only Austria, Belgium and the Netherlands have seen the market decline in H1. JATO believes that tax changes introduced at the start of the year have been holding the Dutch market back. It fell by -5.4% in H1 to 199,594. Among the medium sized markets, several recorded double digit growth in H1. These include the Czech Republic (16.4%), Portugal (37.7%) and Sweden (17.7%). Growth is holding up in both France and Italy, two of the largest markets in the EU, which suffered very badly in the recession. Volkswagen has retained its place as the
best selling brand, with Ford in second place, but both saw sales slip back in June – Volkswagen by -3.1% and Ford by -1.2% Opel/Vauxhall in third place has seen steady growth in 2014 with registrations up 8.3% in H1. JATO notes strong demand for the Mokka compact SUV and revised Insignia. Jeep (42.9%), Lexus (36.0%) and Dacia (36.2%) have been the fastest growing brands in H1. The Volkswagen Golf consolidated its lead in H1 with registrations up 14.2% to 270,462, according to JATO Dynamics. Launched mid-way through the irst half of 2013, the Renault Captur was the big winner in growth terms, with sales up 355.8% in H1. As JATO Dynamics points out, it is the irst small crossover to enter the top 10 sales chart. Renault has been the big European success story in 2014. Group registrations rose by 19.8% in H1, according to ACEA. Renault registrations rose by 14.1% and Dacia by 36.2%. Collectively sales have been driven by the Clio, the second best-selling car in H1 with registrations up 5.3% to 162,558. Then the Captur, Duster Phase 2 and Sandero. Renault has sold nearly 1.4m vehicles in H1 worldwide. The strong European performance helped Renault to offset the decline in Group sales outside Europe, which fell by 9% in H1.
Top 10 Models Make & Model
June ’14
June ‘13
% change June
June YtD ‘14
Jun YtD ‘13
% change YtD
Volkswagen Golf
43,960
40,883
+7.5%
270,462
236,902
+14.2%
Renault Clio
34,606
30,806
+12.3%
162,558
154,359
+5.3%
Ford Fiesta
27,523
25,909
+6.2%
167,941
153,715
+9.3%
Opel/Vauxhall Corsa
26,935
26,035
+3.5%
133,729
131,785
+1.5%
Volkswagen Polo
22,531
26,361
-14.5%
140,539
142,701
-1.5%
Ford Focus
21,712
22,382
-3.0%
121,570
122,661
-0.9%
20,893
9,673
+116.0%
87,410
19,178
+355.8%
Peugeot 208
19,373
22,774
-14.9%
119,686
136,774
-12.5%
Nissan Qashqai
19,271
18,364
+4.9%
110,474
113,726
-2.9%
19,063
19,663
-3.1%
97,336
104,248
-6.6%
Renault Captur
Opel/Vauxhall Astra Source - JATO Dynamics
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