International Fleet World February 2015

INTERNATIONAL

FLEETW RLD All that matters in the world of fleet February 2015

Small cars big ideas Opel’s model range welcomes New Corsa and KARL as the company focuses on global growth

plus...

Driven Volkswagen Passat Renault Twingo

To lease or not to lease Is operational leasing always the optimum solution?

The show-stoppers from LA and Detroit internationalfleetworld.com

THE NEW SEAT LEON X-PERIENCE WITH 4DRIVE DISCOVER NEW ROUTES FOR YOUR BUSINESS

TECHNOLOGY TO ENJOY

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NEW GENERATION INFOTAINMENT Now it’s easier than ever to manage your business, thanks to the touch screen and smartphone capabilities.

VERSATILE AND SPACIOUS The spacious 587-liters boot expands to a surprising 1470-liters to hold all the tools, equipment and products you need to push your business forward.

SEAT FOR BUSINESS

SE AT.COM/BUSINESS Average consumption: 4.8 - 6.8 l/100 km. Average CO2 mass emissions: 125 - 152 g/km.

INTERNATIONAL

FLEETW RLD All that matters in the world of fleet

February 2015

Small cars big ideas

Driven Volkswagen Passat Renault Twingo

To lease or not to lease Is operational leasing always the optimum solution?

Opel’s model range welcomes New Corsa and KARL as the company focuses on global growth

plus...

contents

The show-stoppers from LA and Detroit internationalfleetworld.com

Managing Editor Ross Durkin ross@fleetworldgroup.co.uk

16 Show-stoppers from LA and Detroit.

28 CO2 emissions reduction plans.

30 Interview: Adrian Porter of Hyundai.

44 Ingenious new Twingo 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

04 Fleet Review Editor John Kendall bids farewell to IFW publisher Ross Durkin.

Sales Executives Darren Brett darren@fleetworldgroup.co.uk

06 Inside Knowledge IHS Automotive on the key trends in the US market.

Claire Warman claire@fleetworldgroup.co.uk

08 News The biggest stories from a month in the international fleet world.

Circulation Tracy Howell tracy@fleetworldgroup.co.uk

16 Motor Show IFW selects the highlights from the LA and Detroit Motor Shows.

Dawn Mitchell dawn@fleetworldgroup.co.uk

18 RVs Why a dip in UK RVs could signal changes for the leasing industry.

Head of Production Luke Wikner luke@fleetworldgroup.co.uk

20 Leasing The difficulties of operational leasing in an international market.

Designers Tina Ries tina@fleetworldgroup.co.uk Samantha Hargreaves sam@fleetworldgroup.co.uk

24 Feature How a slew of new apps are transforming the telematics sector.

28 Management CO2 reductions and why manufacturers still have more to do.

30 Interview Adrian Porter on Hyundai’s new models & strategy for fleet growth.

32 Fleet Focus The demise of diesel & the most popular brands with French drivers.

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

38 International Fleet Academy Selection factors in fleet vehicle procurement.

40 Profile Opel’s strengthened small car line-up and plans for international growth.

44 Launch Report Renault Twingo / Audi A3 / VW Passat / Citroën Berlingo XTR+ 48 Global Fleet Forum A round-up of activity on the popular fleet forum.

50 Fleet in figures Breaking down the latest global vehicle sales by region.

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fleet review

This month, editor John Kendall assesses the ongoing impact of low crude oil prices, while bidding farewell to IFW’s founder...

Fuel prices

The rise of the computer

One enduring good news story seems to be the price of oil. Some commentators are predicting that low prices could be with us for the next two to three years, but predicting oil prices is a risky business.

I heard suggestions, mainly from around the Detroit Motor Show in the past week, that the motor industry might be encouraged to build thirstier cars again. Probably not in Western Europe though, where many countries have taxation regimes based on carbon dioxide emissions and the legislative programme will only demand more reductions. For many fleet customers, a respite from the high price of oil is an opportunity to claw back some profit, not send the savings down the nearest exhaust pipe.

It’s only a few years since there was no motor manufacturer attending the Consumer Electronics Show, held recently in Las Vegas. As recent motor show visitors know, the big new car story is now as much about the on-board systems as it is about the hardware. If we take the new VW Passat as an example, more people are likely to specify one of the many driver assist systems on offer than choose the range topping 240hp diesel engine. Ford used the CES Show to announce a smart mobility plan and 25 global mobility experiments. The VW Group also made announcements at the show, as did Jaguar Land Rover, MercedesBenz, Kia… Electronics is big business.

Declining diesel Reducing oil prices may or may not have anything to do with some emerging antidiesel discussions. Diesel for cars appears to be in decline, as we note in this month’s profile piece on France, whose cars were once almost exclusively powered by the oily fuel. The rise of downsized petrol engines and hybrids is almost certainly the cause of the decline in Western European diesel popularity, with diesel absent from most city cars.

Against that, VW announced that it would not be selling petrol versions of the new Passat in the UK, because the market demand for petrol models had slipped to around 1%. With continuing pressure on carbon dioxide emissions, diesel is not likely to disappear soon.

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Farewell Ross Ross Durkin, the man who launched this magazine, along with sister titles Fleet World and VAN Fleet World in the UK, took us all by surprise recently by announcing that he was taking early retirement. Ross has clocked up over 30 years in and around the fleet business and his knowledge of it is vast. Having worked for him for the past 10 years, I can only say it has been a privilege. This magazine and the other Fleet World titles are his legacy. He will not be disappearing completely, I am pleased to say, but I wish him a long and happy retirement and look forward to working with him on some projects still to come.

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SIMPLY CLEVER

N O I T N E T T A G N

I L A E T S

The new ŠKODA Fabia. For your economical and stylish fleet.

The new ŠKODA Fabia will become the highlight of your fleet. And not only thanks to its dynamic design. Its new generation of economical engines will bring you low running costs as well as the great feeling of environmental friendliness. The car’s exceptional spaciousness will ensure comfort for all aboard. Its advanced systems, such as the ESC (Electronic Stability Control) with the multi-collision brake will take care of your maximum safety. In addition, you can choose from an endless variety of exterior and interior colour combinations for complete car customisation.

In convenient: contact us, we will prepare a special offer fit to your needs. At the same time we will most gladly introduce you to other ŠKODA car models. skoda-auto.com/fleet

facebook.com/skoda

Combined fuel consumption and CO2 emissions for the Fabia model: 3.4–4.8 l/100 km, 88–110 g/km

inside knowledge

Dare to be different The 2015 North American International Auto Show delivered on the expectations for focus on trucks and performance, with some surprise concepts, says IHS Automotive.

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he US auto market just closed its best year of second-generation Volt, which features more range and sales since before the recession. With the recova more refined look, as well as the Bolt BEV. The Bolt ery seemingly out of the way, and consumers concept previews a 2017 entry, promising 200 mile feeling more optimistic, timing is right for introducing range. While EVs have been slow to take off so far, offerings that address the non-core products. For automakers need to continue to evolve the technology NAIAS, this meant that supercars, high-powered as one of the tools in the kit for meeting increasingly sedans and new convertibles difficult regulations. As more were much more liberally mixed come to market, the pace of “The US auto market in with trucks and utilities. acceptance has some potential to Largely missing in action were perk up. Honda announced that it has closed its best year mainstream introductions. will add a BEV and a PHEV by The past few years of intro2018, but didn’t show the vehicles. of sales since before ductions had focused on practiAlternative powertrain products the recession.” cal offerings. Now companies made less of a splash for their techare again able to take a look at nology this year, as the propulsion the fun side of automotive life. IHS Automotive foreoption evolves from a novelty to simply another facet of casts US sales in 2015 to reach 16.9 million units, a 2.5% the industry. Fuel cell vehicles, however, remain a growth over 2014. novelty, and will continue to do so until network effects The 2015 North American International Auto Show come into play enough for infrastructure investments. brought out truck reveals, an emphasis on performOutlook and implications ance and further exploration of alternative powertrain The US auto market has closed its best year of sales since options—in some cases, several themes were evident before the recession. Despite the difficulty of those years, on the same vehicle. automakers have largely come out stronger, able to be Sporty and performance introductions profitable at lower volumes and having shed excess The 2015 NAIAS saw a rejuvenation in exciting prodcapacity. With the most difficult work seemingly out of uct from supercars to sports coupes and convertibles. the way and consumers feeling more optimistic, timing Show attendees were simply wowed by the stunning is right for introducing offerings that address the nonFord GT, and it tended to overshadow the equally core products. Notably missing this year are mainstream impressive Acura NSX for a time. sedans, of any size or price point. This is in part a reflection of the industry’s current rush toward filling every Alternative powertrains: Just part of the landscape? inch of SUV space, as well as product lifecycles. IHS AutoAlternative powertrain vehicle introductions had less motive forecasts 12 updated sedans will see sales start impact than in previous years. Chevrolet showed the over the course of 2015, compared with 19 in 2016.

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manufacturer news

Leon opens doors for SEAT with major corporate fleets

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EAT’s new Leon has been credited with opening several new doors for the company, with special importance placed on those major corporates where the company has hitherto made little impression.

Speaking in Austria at the fleet launch of the new Leon X-PERIENCE, SEAT’s head of international fleet sales, Giuseppe Tommaso, told International Fleet World that the company’s sales to fleets in 2014 were up a massive 30%, with sales of Leon up 55% in the same period.

With a sales strategy underpinned by aggressive fleet marketing, development of key account relationships and a new fleet dealer programme, SEAT has used its Ibiza and Leon models to get a foot in the door of some major household name fleets. These include a deal for up to 2,000 units with the Italian police.

According to Mr Tommaso, the new fleet dealer programme has been particularly successful. Over 160 dealers are already enrolled in Germany, France, UK, Belgium, Spain and Italy, accounting collectively for over 9,000 units in 2014.

And with a further six countries coming on board soon the momentum already gained seems set to gather pace.

Euro NCAP announces Best-in-Class Cars of 2014 uro NCAP has named its 2014 Best-in-Class Cars, E which saw the Mercedes C-Class, Nissan Qashqai, Volkswagen Golf Sportsvan, Land Rover Discovery Sport and Skoda Fabia listed.

The vehicles have been recognised for not only achieving the organisation’s five-star maximum rating but for also achieving the highest overall scores in their respective categories. This includes Euro NCAP’s new focus on autonomous emergency braking (AEB) and increased emphasis on ‘Safety Assist’ technologies.

08 / internationalfleetworld.com

Jaguar confirms F-PACE crossover for 2016 launch aguar will launch a performance crossover called J the F-PACE in 2016, sharing its aluminium platform with the XE compact executive saloon.

Announced at the Detroit Motor Show, the F-PACE is the production version of the C-X17 concept and will enable Jaguar to challenge the Audi Q5, BMW X3 and X4, Lexus NX and Porsche Macan in what will be a vital sector for its growing fleet presence.

Technical details and the production-ready design will be revealed later this year, but Jaguar has confirmed that it will have five seats and feature the All Surface Progress Control function, which enables the XE to gain traction on uneven surfaces.

Expect a similar engine range to the XE, likely to include a two-wheel drive version using the new 2.0-litre Ingenium four-cylinder diesel and a supercharged V6 petrol at the top of the range. Production will take place at Jaguar’s factory in Solihull in the UK.

Opel KARL to get world premiere at Geneva pel has announced that its KARL five-door entry-level model will make its world O premiere at Geneva before going on sale in Europe from the summer priced from under €10k.

At just 3.68m long and 1.48m high, the new model will become Opel’s entry-level model while it also completes the small car trio next to the ADAM family and new Corsa.

Just one engine will be available: a new 75hp 1.0-litre three-cylinder Ecotec engine developed especially for the model and mated to a fivespeed transmission. Equipped with the ecoFlex package, consisting of an aerodynamically optimised front spoiler lip and roof spoiler along with low rolling resistance tyres, the KARL emits 99g/km with fuel economy of 4.3l/100km.

For the latest news, visit internationalfleetworld.com

Ghosn: next Nissan LEAF will have 320km range issan is aiming for a 320km range from the next Nissan LEAF, as it goes N head-to-head with the forthcoming Chevrolet Bolt, Renault-Nissan president and CEO Carlos Ghosn has revealed.

Speaking at a media round table at the Detroit Motor Show, Ghosn said electric vehicles were best compared to mobile phones and, as an emerging technology, it’s likely to develop quickly over the coming years.

“With the amount of investment we’re doing with our suppliers to make EV more affordable, much more convenient, much less heavy to charge etcetera, we will be competing with the 320km car,” he said.

Ghosn also said Nissan welcomes additional competition in the sector, and that brands like Tesla are helping Nissan to familiarise people with the technology: “EV represents such a small part of the market that we shouldn’t worry about who we are competing with. We should worry about increasing the share of the market. That’s our main concern – who can help us increase impact of the electric car on the market,” he explained.

Updated 1 Series gets MINI engines MW has heavily updated the 1 Series as part of a range-wide spring B update, adding new MINI-sourced three-cylinder engines with fuel consumption from 3.4l/100km and CO emissions of 89g/km.

2

The hatchback’s redesign brings it closer in style to the 2 Series Coupe and Convertible launched last year, and sees it gain more generous standard equipment and new optional technology including radar-based cruise control and a more advanced parking assistance system.

It also benefits from 1.5-litre, three-cylinder petrol and diesel engines shared with the MINI. These comprise a 109hp 118i petrol which consumes 5.0l/100km and emits 113g/km, and a 116d with consumption down to 3.4l/100km and 89g/km CO2 emissions for the EfficientDynamics version. Updates for the four-cylinder, 2.0-litre diesel now mean this emits as little as 97g/km CO2.

Mid-life engine changes are found across most of the range. BMW is introducing an entry-level 115PS diesel to the 3 Series, which consumes 3.9l/100km and emits 102g/km, while the 4 Series gains a 148bhp 18d and a more powerful version of the 20d with 190hp, both of which consume 4.0l/100km with CO2 emissions of 106g/km. In the 2 Series, the Coupe and Convertible gain a new entry-level petrol engine, while the Active Tourer line-up will include a 99g/km 214d variant with 95hp.

fleetweet a few soundbites from a month in fleet

@zap_map Official Twiiter account for charging and electric vehicles site, Zap Map

@NissanLEAF sits at the top of the #EV sales chart for fourth year running @NissanEV_UK #uk

@pburgess123 Peter Burgess, motoring journalist, Motoring Research Ltd

Scheduled the aircon in my Audi A3 #e-tron last night.

Came out at 6.30 to defrosted and thoroughly warm car.

How good is that?

@PaulWardGover Paul Gover, editor-at-large, Carsguide in Australia

Nissan Qashqai tops Euro NCAP testing for small cars in 2014. Joins X-Trail and Pulsar with 5 stars.

@AM_Capparella Joey Capparella, associate web editor, automobilemag

#VW to focus on four core models for NA market: Jetta, Passat (refresh coming this year), new three-row SUV, and Tiguan replacement.

@teorichards Tom Richards, PR at PFPR Communications

The Ford GT has left me with a conundrum: will my wife mind if I put up a poster of it in our room? #10YearsOldAgain.

@robhalloway Rob Halloway, communications and events director, Mercedes-Benz UK

The new ForTwo’s just as short as its predecessors (2.69m) but an extra 10cm width helps give lots more inner space.

internationalfleetworld.com / 09

A Daimler Brand

Fuel consumption combined: 10.5–3.6 l/100 km; combined CO₂ emissions: 246–94 g/km.

Provider: Daimler AG, Mercedesstraße 137, 70327 Stuttgart

Let the cars for your team be the cars of their dreams.

Fleet vehicles from Mercedes-Benz.

Your personal Mercedes-Benz representative opens up many possibilities: after analyzing your individual needs, we tailor vehicle fleet solutions to suit you. In addition to that, we are available 24-7 as a reliable partner at your side – a service that others can only dream of. www.mercedes-benz.com/fleet

environmental news

Toyota offers royalty-free access to its fuel cell patents

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oyota is making thousands of its hydrogen fuel cell patents available to the rest of the automotive industry, in a move aimed at increasing the pace of development for the technology.

Announced at the Consumer Electronics Show (CES) in Las Vegas in January, the carmaker will enable interested parties to use 5,680 fuel cell vehicle patent licences and applications royalty-free, until 2020.

By doing so, the company hopes others will be able to skip time-consuming development processes and the sector will benefit from shared expertise, in turn improving the technology for consumers and broadening its appeal.

In addition to vehicle technology, the patents include 70 related to hydrogen filling stations, which will be available indefinitely, aiding the roll-out of refuelling infrastructure. Toyota has traditionally made its intellectual property available to others for a usage fee.

“Today’s announcement on patents has less to do with the hydrogen fuel cell car than it does about the cultural growth of a hydrogen society,” said Bob Carter, senior vice president, Toyota Motor Sales.

“Traditionally intellectual properties are iercely guarded because they have great monetary value. By eliminating traditional corporate boundaries we can speed the metabolism of R&D ... and move into the future of mobility quicker, more effectively, and more economically. It is indeed a turning point in automotive history.”

Already on sale in Japan, priced at 6.7m Yen (€45,900) the Toyota Mirai hydrogen fuel cell vehicle will launch in North America and selected European markets this Autumn. Powered by an electric motor, its fuel cell stack generates electricity while driving using a reaction between hydrogen and oxygen, with water as the only by-product. Refuelling takes less than five minutes, offering a 500km range.

EV uptake closely linked to tax schemes, report finds

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he methods used by EU governments to tax cars have had a considerable impact on the uptake of fuel-efficient vehicles, according to a report by environmental NGO Transport and Environment (T&E).

Published in December, ‘How Clean are Europe’s Cars 2014’ found that countries with the lowest average CO2 output for new cars tend to also have registration and company car taxes based on carbon emissions, showing a direct influence on buyers’ choices.

The report pointed out that the Netherlands, which has one of the lowest average emissions at 109g/km, offers steeply differentiated registration tax to encourage efficient

12 / internationalfleetworld.com

vehicle sales, including plug-in models. Benefit in Kind taxation on company cars, further revised downwards in 2012, are also continuing to incentivise the lowestemitting models.

Germany, the largest European car market with almost three million registrations in 2013, does not have a significant registration tax. It also has only a weak graduation of circulation tax based on CO 2 emissions, while Benefit in Kind taxation for company vehicles is a flat 12% per year, and is not differentiated by CO2. This is reflected in average CO 2 emissions of 136g/km, the second highest behind Poland, the report said.

For the latest EV news, visit evfleetworld.com

Range and charging upgrades for Tesla T

esla Motors is developing new technology for its electric vehicles, which will enable existing owners to charge faster and travel further.

A new upgrade package for the Roadster, based on knowledge gained with the Model S, is claimed to increase the range to 400 miles, including a higher capacity battery within the same space, an aerodynamic bodykit and reduced rolling resistance.

The focus for the Model S is on charging. Co-founder and CEO, Elon Musk, tweeted to say the company is developing a charging cable which reaches out to find the car ‘like a solid metal snake’ – though there is no specific timeframe for this technology as yet.

In the meantime, the electric luxury saloon will be used to test battery swap stations, exchanging depleted units for fully charged ones in three minutes. The trial is underway with a station in California, aiming to assess demand before the carmaker decides whether to invest in the technology. Unlike the Tesla Supercharger charging station network, battery swaps will incur a fee.

Bolloré to double French charging network

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rench investment company Bolloré has proposed a network of 16,000 electric vehicle charging points across France, to be installed over a four-year process.

The company, which manages the Autolib electric car sharing service in Paris and the Source London charging point scheme in the UK, presented its plans to French Ministry for the Economy and Finance in December.

A decision will be made by the end of January whether to waive the fees usually attached to installing on public property. Bolloré said it will invest €150m in the network, which will complement the 14,000 charging points already in place across France.

Emmanuel Macron, minister of economy, industrial renewal and information technology, said: “This marks a new step towards electromobility for France. In a public-private joint effort, we now give a boost to the deployment of a national network of charging stations.”

EV 93%

in brief BMW launches smart charging trial BMW Group and Paci ic Gas and Electric (PG&E) are inviting 100 Californian i3 drivers to take part in an 18-month smart charging trial in July, examining how it could reduce demand on the grid and increase the use of renewable energy.

PG&E will monitor and remotely control charging, staggering power delivery based on participants’ departure times, with an opt-out for short-notice journeys.

Outlander PHEV can power a house Mitsubishi has developed a system which enables the Outlander PHEV to function as an emergency electricity source during electrical blackouts. The Outlander’s battery has enough energy to power a house for a day, and could provide energy for ten days using the engine as a generator.

Daimler invests to meet growing battery demand Daimler AG is to invest €100m in its battery subsidiary Deutsche ACCUmotive, recognising “continued growth in demand” from the industry. Already manufacturing batteries for Mercedes hybrids and electric Smarts, its new building opening in mid-2015 will give it quadruple the loor space available when it launched in 2011.

EVtweet of the month @NissanUKPR #Nissan & NASA partner to jointly develop and deploy autonomous drive vehicles by end of year.

British LEAF drivers who said they use it as their main car.

in numbers

320km Range of the Chevrolet Bolt electric vehicle.

SOURCE: California Nissan

SOURCE: General Motors

internationalfleetworld.com / 13

business news

Business Lease Group expands

B

usiness Lease Group has acquired Fleet Management Services in Romania in a move to consolidate its position in Central and Eastern Europe.

Harm Nijlunsing, CEO of Business Lease Group, said: “The takeover is part of our strategy of expanding further into Central and Eastern Europe, where the market is developing rapidly. Working with FMS, a company with a good reputation and solid customer portfolio filled with both international and local blue-chip companies, we can continue our growth curve. In addition, this expansion gives us an opportunity to further improve the quality and continuity of our services in Central and Eastern Europe.”

Fleet Logistics launches QuickScan benchmarking service for large fleets

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leet Logistics has launched a free-of-charge benchmarking and consultation facility for large international fleet operators for a limited period, aimed at optimising their fleet spend.

Called QuickScan, the product has been developed in response to requests from large fleet operators to discuss how their fleets compared with others of similar size and profile.

QuickScan is available to all fleet operators with a minimum fleet size of 1,000 cars, and offers them the opportunity to benchmark their fleets against those of their peers. The facility then goes on to identify areas of potential cost and efficiency optimisation, helping fleet operators to run their fleets more efficiently.

Sofico plans further business investment global fleet software provider Sofico has announced BThiselgium-based plans to invest in the business in 2015 following a successful 2014. year has seen a number of new go-lives for the company’s Miles

system, multiple ongoing implementation projects and the strategic acquisition of Car Systems in France.

MD Gémar Hompes said: “2015 will see further investment in our business, including product innovation around rental and truck markets.

In June, we will also invite our customers to our forum in Ghent where they will be able to share and discuss with us their strategic needs and receive an update on our development road map for Miles.”

in brief Clean Fleets targets European public sector fleets To help European public sector leets, the Clean Fleets project has developed a guide on how to procure clean and energy-ef icient vehicles and an accompanying free Life-Cycle Cost tool.

The new guide is designed to assist public authorities and public transport operators in purchasing clean and energy ef icient vehicles in full compliance with European legislation – in particular the Clean Vehicles Directive.

West European car market grows 4.7% in 2014 The West European car market expanded by 4.7% in 2014 taking it to 12.1 million units, the best result since 2011 and the irst year of growth since 2009, according to LMC Automotive.

All Big Five markets in the region improved on their 2013 totals (though, in the case of France, it was a close call); however, the evolution of some market selling rates in recent months has disappointed, according to the firm.

Volkswagen announces milestone sales The Volkswagen Group has reported that it delivered 10.14 million units from January to December 2014, marking a rise of 4.2% and the first time the group has exceeded the 10million vehicle milestone.

Dollar Thrifty adds extra 116 rental branches in Germany

Grant Thornton UK LLP & CRIF join Leaseurope easeurope has announced that Grant Thornton UK LLP and CRIF, L a global company specialising in the development and management of credit reporting, business information and decision support systems, have joined as its latest associate members.

Leaseurope’s chair Enrico Duranti said: “The coming on board of CRIF and Grant Thornton UK LLP as associate members is fully in line with Leaseurope’s road map, especially when it comes to developing special partnerships with players active in the leasing and automotive rental ecosystem. I believe these new partnerships will translate into more value added for our Federation and its members.”

14 / internationalfleetworld.com

Dollar Thrifty Automotive Group has expanded its existing network in Germany with 116 additional locations throughout the country. The move forms part of the international growth strategy of Dollar and Thrifty, which was announced in February 2013 and has seen openings in Belgium, France, Luxemburg, Netherlands and Spain.

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H O

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F L E S T I S K R A P N E V E IT

The new Corsa.

With Advanced Park Assist and Rear View Camera.

The new Corsa makes parking a piece of cake. Advanced Park Assist1 steers your car in on its own.

It uses sensors to check what’s in front and behind while the Rear View Camera1 keeps you in the picture. For more about the new Corsa and how it makes driving easier,visit opel.com 1

Available as an option at extra cost.

Fuel consumption combined 6,0–3,2 l/100 km; CO2 emissions combined 140–85 g/km (according to R (EC) No. 715/2007).

MOTOR SHOWS LA & Detroit

USA shows the way The end of the year brings a stream of shows in North America, starting with the Los Angeles Show, followed by the North American International Auto Show in Detroit in January. IFW picks out the highlights.

Audi Prologue Prologue, unveiled at the LA Show is said to show a new design direction for Audi. Inside the two-door coupe, the instrument panel is a large touch screen display. 605hp is available from the 4.0-litre TFSI V8 and the car features four-wheel-steering as well as four-wheel-drive. The large coupe is slightly shorter than the current A8.

Infiniti Q60 Infiniti also premiered a two-door coupe concept at Detroit in the shape of the Q60. Expect a sports coupe in 2016 influenced by the Q60. Aluminium and carbon fibre feature in the construction. Exterior lighting is by LED. Power comes from a front mounted V6 3.0-litre gasoline engine driving the rear or all wheels through a sevenspeed automatic transmission.

Buick Avenir Buick’s Avenir concept made its debut at the Detroit Show in January, said to be a flagship saloon model exploring new levels of design. Features include personal seating for four, LED exterior lighting, 21-inch wheels, a new directinjection V6 petrol engine with cylinder deactivation and Stop/Start, a nine-speed automatic transmission, allwheel-drive and mobile device wireless charging.

16 / internationalfleetworld.com

Lexus GS F Lexus announced its rival for the BMW M5 ahead of the Detroit Show, adding a sports saloon to the large executive car. It’s powered by a 473hp 5.0-litre V8 gasoline engine driving through an eight-speed automatic transmission. Standard equipment will include Lexus Torque Vectoring Differential with three operating modes, as used on the RC F.

Mazda CX-3 Mazda debuted the CX-3 crossover at the LA Show. The compact crossover will be powered by a SKYACTIV 2.0litre petrol engine in North America and will also be available with the latest version of Mazda’s all-wheel-drive system. A six-speed automatic transmission will be standard. Global sales are due to start with Japan this Spring.

Volvo S60 Cross Country Volvo introduced the V60 Cross Country at the LA Show and followed it up with the S60 Cross Country at Detroit, powered by a 254hp T5 petrol engine. Ride height is increased by 65mm and the car has all-wheel drive, European buyers will have a front-wheel-drive option too. Sales are expected to begin this Summer.

Scion iM concept Toyota division Scion revealed the iM concept at the LA Show and indicated that the car will become available in North America this year, priced below $20,000. Pitched at younger drivers, the five-door hatchback promises fuel efficiency and performance. The concept was equipped with 19-inch alloy wheels, height-adjustable suspension and four-piston front brake callipers.

Volkswagen Cross Coupe GTE Volkswagen’s Cross Coupe GTE follows similar thinking to the Volvo S60 Cross Country in delivering an all-wheel-drive coupe SUV, but the Volkswagen is larger and powered by a plug-in hybrid drivetrain. It features a 276hp 3.6-litre V6 direct injection petrol engine with two electric drive motors.

Production is due to begin at the end of 2016 in the US.

internationalfleetworld.com / 17

RVs

Analysing leasing and residual value confidence in the Eurozone and beyond...

UK RVs dip after upbeat year RVs in the UK rose by 5% in 2014 but went into decline in the last quarter.

Does this signal changes ahead? Experteye looks at the evidence.

T

he UK contract hire and leasing sector saw a dip in optimism in the quarter to November 2014. The forecasted residual values built into contract hire rentals fell by -1.9% between September and November 2014, after a strong 12 month period in which they had risen by +5%.

As a result, UK leet operators felt a +0.2% rise in their average rental rates, having enjoyed a year in which prices fell by -1.8%.

The igures 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.

In Portugal, forecasted residual values rose by +5.7% in the last 12 months, with a +1.9% climb in the three months to the end of November 2014, making it the most con ident in the future economy and used vehicle market. In Italy, RVs have gone up by +2.7% since December 2013, and by +0.5% during the quarter. Spain saw a +2.1% annual increase and +1% for the quarter. In Germany RVs rose by +1% for the year and +0.3% for the three months. Yet, pessimistically, French leasing companies reduced their forecasted residual values by -0.5% for the year and -0.9% for the quarter.

Market summaries – 3 and 12 months to November 2014

FRANCE: A -0.9% reduction in forecasted residual values, and a +2% rise in servicing, maintenance and repair (SMR) budgets contributed towards French fleet operators suffering a +4.2% increase in rental costs during the last quarter. This follows a year that saw monthly leasing costs fall by -0.9%, with forecasted RVs dropping by -0.5% and SMR rising by +4% since December 2013.

GERMANY: Germany has enjoyed a period of sustained stability with no dramatic movement across its budgets or costs. During the last 12 months forecasted RVs have moved up by +1%, with a +0.3% increase in the last quarter. SMR budgets rose by +1.1% since December 2013 and by +0.3% since September this year. Rental rates have gone up by +0.8% for the year and +0.3% for the quarter.

ITALY: SMR budgets have dropped significantly in Italy in the last 12 months, falling by -10.9%; by far the biggest reduction of all nations surveyed. Yet they have recently stabilised with a small -0.2% fall for the quarter. Forecasted RVs went up by +2.7% for the year and +0.5% for the quarter, and rental rates have crept up by +0.4% since September 2014 after a year that saw them fall by -3.3%.

PORTUGAL: Portugal has seen some big shifts in its forecasts, budgets and pricing. In the last 12 months, forecasted RVs have gone up by +5.7%, SMR budgets have fallen by -5.9% and rental rates have dropped by -6.7%. Since September 2014 the picture is less dramatic, however RVs have moved by +1.9% SMR by -1.6% and rentals have fallen by -1.7%.

SPAIN: After a year in which rental costs fell by -3.4%, Spanish fleet operators have seen a +0.4% increase in the last quarter. SMR budgets went up by +0.7% for the year and +0.6% for the quarter and forecasted RVs improved by +1% after a year in which they went up by +2.1%.

UK: The UK has been enjoying a very upbeat period, with forecasted RVs improving by +5% since December 2013. However, with RVs dropping by -1.9% in the last quarter, there has been a recent dip in optimism. SMR budgets went up by +0.4% in the last quarter having remained static for the last 12 months (0% change). Average rentals had been coming down, with a -1.8% reduction for the year, but went up by a slight +0.2% in the last three months.

CHANGES IN RV FORECASTS, SMR COST FORECASTS AND LEASE RENTALS Forecast Residual Values

France Germany Italy Portugal Spain UK

Forecast Service, Maintenance and Repair Costs

Current Rental Rates

3-month change 12-month change 3-month change 12-month change 3-month change 12-month change -0.9% -0.5% +2.0% +4.0% +4.2% -0.9% +0.3% +1.0% +0.3% +1.1% +0.3% +0.8% +0.5% +2.7% -0.2% -10.9% +0.4% -3.3% +1.9% +5.7% -1.6% -5.9% -1.7% -6.7% +1.0% +2.1% +0.6% +0.7% +0.4% -3.4% -1.9% +5.0% +0.4% +0.0% +0.2% -1.8%

Notes: • The comparisons are for vehicles with a contract duration of 36 months/90,000km.

• Twelve-month comparisons show change since December 2013.

• Three-month comparisons show change since September 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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Target groups: International Fleet Managers / International Fleet Procurement Managers Capacity max. 130 people Access only with admission ticket and an official ticket for the press day.

Registration and additional information: www.internationalfleetmeeting.com Limited number of participants.

Timetable: From 09:00 Welcome Desk opened 11:00 Start of the event / networking 11:30 Top Speaker (in English) – Prof. Dr. Stefan Reindl, Institut für Automobilwirtschaft Presentation results Study «Corporate Mobility 2020» 12:00 Panel discussion – Ralph M. Meunzel, Publishing Director Springer Automotive Media and Editor in Chief AUTOHAUS 12:30 Lunch buffet and networking 13:30 End of the official event 14:00 – 18:00 Lounge-service for sponsors, media partners and guests (only with admission ticket) Contact: aboutFLEET / A&W Verlag AG • Mrs. Jasmin Eichner • Riedstrasse 10 • CH-8953 Dietikon Phone +41 (0)43 499 18 60 • Fax +41 (0)43 499 18 61 • Mobile +41 (0)79 766 99 00 • je@auto-wirtschaft.ch • www.aboutfleet.ch fleetcompetence europe GmbH • Mr. Balz Eggenberger • Alte Landstrasse 106 • CH-9445 Rebstein Phone +41 (0)71 777 15 32 • Fax +41 (0)71 777 15 31 • balz.eggenberger@fleetcompetence.com • www.fleetcompetence.com Please note this programme may be subject to change

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FEATURE Operational Leasing

To lease or not to lease?

Operational leasing may be widely accepted in Western Europe, but it is not always the best solution elsewhere, as Steve Banner reports.

O

perational leasing has almost become part of the furniture so far as leets in the leading economies of the West are concerned.

“In the mature markets of Europe and North America the debate over whether it makes sense for leets to use operational leasing to obtain the vehicles they need ended a long time ago,” says LeasePlan International managing director, Jose Luis Criado (right).

“Companies have realised that by using operational leasing they are outsourcing leet acquisition and support to experts who can do the job more ef iciently than they can, allowing them more time to focus on their core business.”

The situation is different in less-mature markets, however, he says: “Remember that leasing is a sophisticated type of service and requires an infrastructure to

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support it,” Criado points out. What he means by that is that it needs everything from comprehensive dealer networks to an appropriate taxation structure.

“If a country does not have such facilities then leasing companies may ind it more dif icult to convince potential clients that leasing is more ef icient than outright purchase,” he continues. “The same applies in markets that have a history of inancial instability with interest rates that regularly rise dramatically only to plummet unexpectedly again.”

Some markets may have currency restrictions in place that can make it dif icult for irms operating in them to repatriate all of their earning to their home countries. If they manage to do so then they may ind that their home country taxes them heavily on their overseas earnings.

“If you’ve got cash trapped in this way then you may decide to buy your cars outright in the market

“Companies have realised that by using operational leasing they are outsourcing fleet acquisition and support to experts who can do the job more efficiently.”

LeasePlan International managing director, Jose Luis Criado

concerned and use a management company to help you run your leet,” says ALD Automotive chief executive of icer, Mike Masterson (right). “We have some global clients who operate in over 30 countries and do something along those lines in perhaps a couple of them.

“On the subject of tax, bear in mind that some markets tax CO2 emissions particularly harshly and that that the Bene it-in-Kind tax leet drivers have to pay can differ from one country to another,” he continues. “Some markets impose a wealth tax on more expensive cars while others tax all new cars heavily; Denmark is a good example.

“As a consequence new vehicle prices are not consistent, even across the European Union,” he continues.

“In Denmark the basic price of new cars is in fact quite low, but the taxes imposed on them are high.”

Because government policies vary so much it can take longer for a leasing company to put together an agreement covering a number of different countries than a client might suppose, he says.

“Some customers believe it can be done in no more than three or four weeks,” he observes. “In reality however, legal, contractual and taxation differences can mean that it takes more like three or four months.”

A key advantage of dealing with the major leasing companies is their sheer purchasing power, Masterson says: “Businesses like ours buy a lot of cars, tyres, workshop hours and so on,” he says. As a consequence they can obtain them at far more advantageous rates than a small leet can ever hope to; and can pass on the bene its accordingly.

“We can get stuff far cheaper than a irm only running a few hundred cars can ever hope to do,” says Hitachi Capital Vehicle Solutions chief executive, Simon Oliphant (right).

“The scale on which we operate keeps the per-vehicle cost of management low and gives us the ability to invest in innovative web-based systems,” says Masterson.

Masterson goes on to highlight some of the morewidely-understood advantages of operational leasing, not the least of them being that the lessor shoulders the residual value risk.

“Your costs are ixed, you’re using somebody else’s money, you’re not using cash that might be better employed elsewhere in your business to acquire depreciating assets and you’re reducing the cost of funding the vehicles you need,” says Oliphant.

“If whatever you are looking for costs £100,000 for the sake of argument then you may only be funding half of that because it will still be worth, say, £50,000 in ive years time when it goes back to the lessor,” he continues.

“Admittedly there is interest to pay but it still works out a lot cheaper than hire purchase.”

Furthermore, the payments the client makes are usually tax-deductible, although the rules can differ from country to country. “If VAT is in force then it may not be possible to recover it fully if there is an element of private usage of the vehicle by the driver,” he points out.

There are some countries that impose restrictions on the use of an operating lease says Oliphant.

“In Turkey for example, you can’t use one to inance the acquisition of a truck,” he says. “The thinking is that irms that lease their trucks are doing so because they haven’t got the money to purchase them and if they are short of cash then they may not be able to afford to maintain them properly.”

There are exceptions to the rule. “If you are a leet operator than you may be allowed to put a proportion of your trucks on a lease but you need a licence to do so,” he says.

“In some countries you can also face situations where all the vehicles are owned by a leet operator and managed in-house because that’s always been the case and there is a reluctance to change,” says Masterson. “And strict labour laws may make it dif icult for a leet to get rid of existing staff.”

Anybody opting for operational leasing will have to answer a number of pertinent questions posed by the lessor. Aside from demonstrating their creditworthiness they will have to be able to tell the lessor exactly what their requirements are.

“If a customer wants to acquire a van leet for example then a lot of the discussion will be about fuel ef iciency and minimising downtime,” Criado says. “If however they are looking to obtain cars that will be used as perks for senior executives, then personal support for the individual using the vehicle may be the paramount concern.”

In some markets – China and India for example – that may involve providing a chauffeur. In others – Mexico and Brazil for instance – the lessor may have to arrange for the vehicle to be armoured to protect the executives inside it from attack.

Minimising the leet’s carbon footprint may be a key issue. “Even though CO2 igures may not always be published outside the more mature markets, multinational companies may insist that the same standards must be adhered to regardless of which country they are in,” Criado observes.

“We also need to know basic things such as the make and model of the cars the customer requires, the duration of the contract, the nature of their business and the likely annual mileage,” says Masterson.

“While you should try to ensure that your mileage igure is accurate, a reputable operational leasing company will tell you if it is being exceeded,” says Oliphant.

internationalfleetworld.com / 21

¡

FEATURE Operational Leasing

To lease or not to lease? clients may of course be looking for a mobil¡ ity“Some package,” says Masterson. That can include a combination of things; a small car – possibly an electric one – plus a bicycle or maybe a rail season ticket.

Lessees should be careful not to include items in a lease that they do not really need.

“Replacement vehicles used to be included regularly, but they incur a cost and how often do you really need one?”, wonders Oliphant. “On the other hand if you are, say, maintaining railway tracks and only have access to them between 2am and 5am then the prompt provision of a replacement vehicle may be absolutely vital.”

No matter where in the world they are, businesses looking to pursue the operational leasing route would be well advised to ask a few questions of their own before they sign on the dotted line. That is especially the case when it comes to return conditions and any penalties that may be incurred if the agreement is terminated early.

“We make it absolutely clear to customers at the start what sort of damage will be classed as normal wear and tear when the vehicle comes back to us and what will attract a charge,” Criado says. “Unfortunately it is still the case with some leasing companies in certain markets that a low front-end price may mean that they will get their money back by taking a tough line on the condition the vehicle is returned in.

“So far as early termination is concerned, we really don’t want to charge anybody but we don’t want to lose out either because the vehicle has not been fully depreciated,” he continues.

“This is where our open calculation approach comes in useful,” he adds. “By using it we can demonstrate to the client that any charges we may have to impose are reasonable rather than excessive.”

Something all leets should enquire about is the availability of data on the operation of their vehicles from the leasing company in an easily digestible form.

“In the past it was quite typical to go into a leet manager’s of ice and see a pile of print-outs that had clearly never been looked at because the manager hadn’t had time, gathering dust in a cardboard box in the corner,” Oliphant says. What clearly makes more sense is to give the manager a readily comprehensive overview of what is going on plus the ability to drill down into the data if that is what is required.

“One facility we can offer is a leet ef iciency index,” he continues. “We analyse the data of all of our customers using 27 KPIs, remove the names of all of the leets concerned, then publish the data to our clients so they can see how well or how poorly they are performing in comparison with other operators.

22 / internationalfleetworld.com

“The KPIs cover areas such as operating costs, environmental impact and safety.”

The debate over how leases should be treated in company balance sheets rumbles on, but Criado is relaxed about it.

“We are of course interested in the eventual outcome but we are not afraid of it,” he says. “Whatever happens, remember that if you buy your cars you will always show more assets on your balance sheet than you will if you lease them.”

Not that the accountancy treatment of leased vehicles is a huge issue for the vast majority of companies that LeasePlan deals with anyway, he stresses. They are far more interested in leveraging LeasePlan’s substantial buying power when it comes to purchasing vehicles and related services; and tapping into its expertise.

“There are some circumstances under which you may be obliged to show assets on your balance sheet,” says Oliphant. “If you operate in a regulated sector of industry for instance then this may be something that the regulator looks for.”

Keeping the regulator happy is likely to take precedence over balance-sheet concerns; because if the regulator is unhappy, the operator may end up losing a substantial slice of business.

“Some clients may of course be looking for a mobility package.”

Mike Masterson, chief executive officer, ALD Automotive

FEATURE Telematics apps

P l a ne t o f the apps Telematics has been liberated from a black box in your vehicle to finding a place among the apps on your smartphone, as Steve Banner finds out. press photographer took a picture of the inauguration of Pope Benedict XVI in 2005.

A In 2013 he photographed the inauguration of Pope Francis from exactly the same spot.

In the second photograph, almost everybody was waving a smartphone with a camera. In the first, nobody was.

The difference between the two shots illustrates the speed with which smartphone use has spread and the impact it is having on society.

It is having an impact on fleet operators and their drivers too, with the use of smartphone apps continuing to spread.

AppDrive Why go to the expense of installing a driver behaviour monitoring system in a van or car when you can glean at least some of the benefits it can deliver at a lower cost by using a phone app instead? In Germany TomTom has just announced a deal with insurer Signal Iduna, which involves doing precisely that.

AppDrive powered by TomTom provides data from the latter’s LINK 100 device on, for example harsh acceleration and braking and wayward steering, to the driver's smartphone. Such behaviour will affect the premium discount available giving the driver every incentive to behave sensibly.

Admittedly this is aimed at young drivers insured under private policies rather than fleets. However, the general principle remains the same.

LINK 100 is plugged into the car’s diagnostics point and does not transmit the vehicle’s position.

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ProfiDriver ZF has come up with an app designed to improve driving style called Pro i Driver. It allows drivers to check their performance in comparison with the average results across the leet on an Android display.

Fleet managers can analyse the driving styles of their employees on a web portal and receive the results in the guise of a graph, a table or a ranking.

The manager can set threshold values in terms of speed, engine idling time, acceleration and braking force. The driver is warned every time he or she deviates from these standards.

“As a consequence Profi Driver significantly contributes to reducing the fleet's fuel consumption, wear and tear on vehicles and maintenance costs,” says a company spokesman.

It was being showcased at the IAA Hanover Commercial Vehicle Show alongside an app aimed at truck drivers. Driving Times displays current information about how long an individual may drive in a day, a week or a fortnight without breaking the law.

Drivers are less likely to fall foul of legislation as a consequence and the traffic office will know how many hours each one has available at any given time. That will help it determine which drivers should be allocated to which jobs.

Zonar Elsewhere, GreenRoad and US-based telematics provider Zonar have signed a deal that means GreenRoad’s driver behaviour feedback and monitoring package is being offered on the 2020 tablet. “Fleets using the 2020 are expanding the use of the mobile platform to streamline and improve a variety of driver functions,” says Zonar chief operating officer, Vikas Jain.

Toyota Link In Australia, Toyota owners can now access a new suite of apps directly from their car dashboard with the launch of Toyota Link developed by Intelematics. It does everything from finding service stations and comparing the prices they charge for fuel to giving the weather forecast for any location drivers find themselves in.

SYNC 2 MyLink/OnStar Other manufacturers are following a similar path. GM offers Intellilink or MyLink (for Chevrolet and Holden brands), which enables drivers to connect a mobile phone via Bluetooth and control on-line services via apps installed on the system. GM’s OnStar services are integrated in Intellilink, which includes Advanced Automatic Collision Notification, roadside assistance, diagnostics information and on-board navigation. For Europe, Intellilink first appeared in the Opel/Vauxhall ADAM and is being rolled out across the European model range.

Ford offers the latest generation of its SYNC system, SYNC 2, which made its debut in Europe on the new Ford Focus recently and has been available in North America since 2012. This builds on the functions that Ford introduced with SYNC in 2007 and offers similar features to GM’s Intellilink in integrating mobile phone connectivity and offering apps covering areas such as navigation and vehicle tracking. The system is available on a range of cars and light commercial vehicles. SYNC 2 offers voice activation for many of the functions.

ParkRight CarPlay The new Volvo XC90 unveiled at the recent Paris Show showed Volvo’s thinking regarding apps and connectivity with a large eight-inch touchscreen at the heart of the system, using Apple’s CarPlay or Android Auto systems to integrate Apple and Android devices and functionality.

Volvo is one of several manufacturers who have signed up to offer Apple’s CarPlay. Apple’s Maps system offers in-car navigation while using Apple’s Siri voice activated system, Apple Messages can be dictated and sent or received. Not surprisingly, Android Auto offers similar phone and app connectivity, with Google Maps and voice activation among the functions for users of Android devices and will be supported by most major car brands. For both CarPlay and Android Auto, development is just beginning and we can expect to see many more apps, including those for leet users, to become available as development continues.

In the UK, Westminster Council has launched the ParkRight smartphone app to make it easier for drivers to ind a parking space in central London. Sensors have been installed in 3,000 roadside spaces that show if they are vacant so that motorists do not have to keep driving around looking for an empty one, adding to traf ic queues and pollution.

“Part of the answer to the congestion conundrum lies in investing in technology like advanced parking services,” says Matt Simmons, European director at real-time traffic, transportation analytics and connected driver services provider INRIX. “They will become increasingly important as electric car use becomes more widespread because drivers will have a critical need to pinpoint available charging bays when batteries are running low.”

This need not involve parking bay sensors however, he adds. “We can already determine where available onstreet parking is located without having to go to the expense of installing and maintaining them,” he says.

internationalfleetworld.com / 25

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MANAGEMENT CO2 emissions

CO2

Average emissions in Europe in 2013 dropped below the EU 2015 target.

JATO Dynamics vice president of data Brian Walters reckons that car manufacturers are nearing the finish line where average CO2 emissions are concerne.d.

W

ith the irst of the EU’s deadlines for average emissions levels now looming large, the most recent analysis from JATO Dynamic’s annual CO2 report suggests that 2013 can be considered a watershed year for the industry. In that year, average CO2 emissions for new cars dropped below the 2015 target of 130g/km for the irst time. The overall drop in CO2 re lects technological advances that have made cars more ef icient, as well as a shift in consumer tastes towards lower emission models.

The data show that the industry as a whole has continued to build on the signi icant improvements it has made over the last 10 years. This was apparent from the overall average reduction of 5.5g/km - the greatest year-on-year drop for the last four years - with all model segments achieving average falls in CO2 emissions. In 2013, almost half (49.12%) of new cars sold had CO2 emissions of less than 120g/km; seven times the share of cars from a decade previously. The Netherlands led the way with the largest year-on-year drop in emissions in 2013, making them the irst country to reduce average emissions below 110g/km.

However, there is still some work to be done within the industry, as some manufacturers are behind on the reductions needed to hit the 2015 targets.

28 / internationalfleetworld.com

“The Netherlands led the way with the largest year-on-year drop in emissions in 2013.”

Driving the change Some of the improvements can be traced back to the impact of broader economic factors, such as higher fuel prices and the introduction of incentive schemes (tax breaks, for example) within individual markets, which continue to play a signi icant role in bringing CO2 emissions down. The European Commission will greet the impact of these policies with enthusiasm, and governments will highlight the part they played. The UK Government, for example, ran the ‘Go Ultra Low’ campaign last January, backed by BMW, Renault, Toyota and Vauxhall/Opel. Although many different groups are playing a role in reducing CO2, the industry has led the way through continued innovation in both engineering and car design, especially the manufacturers that hit the targets ahead of schedule in 2013.

Changes in fuel preference played a part as ‘pure’ diesel engines lost market share to ‘pure’ petrol. Advances in engineering make this less of an issue than in the past however, as there is now only 0.3g/km difference, on paper, between the average emissions of both fuel types. A surge in the popularity of plug-in cars (both electric vehicles and range extended electric vehicles/plug-in hybrids) has also brought down emissions. These models more than doubled their market share in 2013, to 0.49%.

These sales are part of a broader trend towards smaller and more efficient cars, driven by more environmentally conscious consumers, which has also contributed to the overall reduction in average emissions.

Consumers have also demonstrated a preference for models with improved powertrains. This has meant that larger models that tend to emit larger amounts of CO2 have also seen notable improvements.

Leading the way

Not quite there yet

The 2013 data shows that nine manufacturing groups met the 2015 target two years ahead of schedule. Mitsubishi was the lowest-emitting group overall, while PSA was the best performer out of the high-volume manufacturing groups.

Maserati is the most improved manufacturer, with average CO2 emissions for its leet down by 60.2g/km compared with the previous year.

Some manufacturers will need to make further improvements if they hope to meet the 2015 targets. Subaru and Tata Motors are under pressure after failing to meet 2013 targets and both will have to make the biggest improvements overall in order to bring their average leet emissions down to 130g/km before the deadline. Since both are medium-volume brands they could choose the alternative 25% target, which would make this more manageable and put Subaru already ahead of its equivalent 2015 target.

Tata’s Jaguar Land Rover division has new models, including hybrids, coming soon, so they should also achieve the 25% target by 2015.

The good news is that the 2015 target is in reach for the vast majority of manufacturers. This will require some work for Mazda, Honda and Suzuki, but it should still be achievable nonetheless. It is also encouraging that very few brands went in the wrong direction in 2013, and of those that did, some, like MINI and Kia, saw minimal increases of less than 1g/km. One exception to this was Ferrari – average emissions were up 20.4g/km year-on-year for 2013, bucking the general trend seen in the S (sports) segment.

Renault was the lowest emitting of the high-volume brands. However, improvements were seen across the majority of volume brands, and average emissions for the top six volume brands fell below 120g/km for the irst time. In initi’s Q50 was the most improved model, cutting average emissions by an impressive 111.4g/km compared with its 2012 Gseries predecessor, following the launch of diesel and hybrid models with the Q50 launch in 2013. For the second year running, the Lexus CT was the lowestemitting model without a plug-in version, with average emissions of 93.2g/km.

Conclusion Overall, 2013 was a good news year for manufacturers, regulators and the environment as the industry made another big step towards the 130g/km target which now looms large. Since the 2015 targets were set, the industry made signi icant progress in car emissions thanks to technological innovations and has seen a further boost thanks to economic and consumer trends in recent years.

Although many manufacturers have met their targets (provided, of course, that they have not slipped backwards in 2014) and many others are nearly there, we would expect to see further improvements between now and the 2015 deadline.

One main reason for this is that the 2015 target is just the end of the beginning.

Manufacturers will already be looking ahead and planning how they are going to make further reductions to CO2 emissions levels in order to meet the next round of European Commission targets. Politicians, manufacturers and consumers can all be proud of the part they played in the progress to date, but it will take continued innovation, technological improvement and sustained demand for low-emission vehicles to meet the next challenge that lies ahead.

For more information about JATO Consult’s Report 2013 – ‘A Review of New Car CO2 Emissions across Europe,’ visit www.jato.com.

internationalfleetworld.com / 29

INTERVIEW Adrian Porter, Hyundai Motor Europe

New models, new possibilities Hyundai starts 2015 with a clutch of revised models. John Kendall asks how this will help the company’s European fleet business.

H

yundai announced a raft of detail changes to its model line-up in early December 2014, introducing the new Generation i20 coupe, revised i30 and i40 – all at the core of Hyundai’s European fleet range. European fleet sales and remarketing director Adrian Porter was also on hand to bring us up to date with the company’s European fleet business, and we started by asking him how he thought the revised models would impact Hyundai’s fleet business in 2015.

“The reduced CO2 emissions from i40 and i30 and the refreshed design of these key fleet vehicles will be very good for us,” he suggests, “One vehicle that I think will give us a new element is the new i20.

The old i20 was very much seen as a value-for-money vehicle, but was not necessarily seen as a strong fleet contender. The new car is a more mature vehicle, it is slightly more spacious and we are positioning that in a way that we think will be extremely attractive to the large fleets.”

Porter joined Hyundai in January 2014 and is clear that Hyundai’s fleet profile in Europe was not as strong as it could have been when he joined the company, “One of the challenges I had coming into this role at the beginning of 2014 was that from a fleet perspective, Hyundai was relatively immature,” he says, “There was a big focus on the private sector and Hyundai recognised the importance of the fleet sector and that it needed to raise its game, so hence the creation of my position.”

Hyundai’s European volume was relatively static in 2014, “Final figures will be above 2013, but there won’t be any major growth,” continues Porter, “So it has given me the opportunity to develop

30 / internationalflfeetworld.com

a number of programmes to improve the qualitative process – the way we approach the market.

“One of those major elements ties in very much with our new approach to our dealer network. Improving the quality of our dealer network will be emphasised in our fleet business centres across Europe. We currently have 425 and will probably finish 2015 with around the same number. However, we are going to roll out a brand new training programme, with brand new key performance indicators for those business centres. We will be able to offer much higher service quality through training and infrastructure developments in order to support fleet customers, whether those are small and medium-sized businesses (SMEs) or major leasing and rental companies.”

Hyundai will be focusing its fleet business across the whole fleet spectrum, “We have historically been very strong among SMEs,” Porter acknowledges, “We recognise that we have to improve the quality of our infrastructure to support them. Fleet business, like the retail business is becoming more sophisticated.

Fleet customers are demanding a higher level of service and sophistication, including finance products, maintenance products and they generally expect a dealer to be a service point, a ‘One-StopShop’, rather than just a place where you have your car serviced. So we will be rolling that out from the first quarter of 2015 to ensure that we meet that growing demand.”

The ‘Big Five’ fleet markets in Europe – France, Germany, Italy, Spain and the UK – are not surprisingly among the most important for Hyundai, “We grew quite significantly in the UK this year. Our

approach to the market through our ‘White Label’ programme Hyundai Leasing was extremely successful, far exceeding our targets,” says Porter.

“In 2015, Germany is, I believe, the only fleet sector where forecasts are predicting there will be a slight decline.”

This is being attributed to an overall change in buying processes, while the significant market growth in 2014 is expected to see a levelling off in the German fleet sector in 2015. “It will grow again in 2016 and 2017, but it also gives us the opportunity to improve the quality of our business and also our network in Germany and how we approach the fleet business here,” reckons Porter.

Hyundai has its European head office at Frankfurt in Germany.

“In Italy, we have grown our ‘True Fleet’ or corporate volume by a significant 80-85% in 2014,” he adds, attributing this mostly to a change in how the company has done business in the country, both in how the market has been approached and how business has been carried out.

In Spain, the PIVE (Programa de Incentivos al Vehículo Eficiente) scrappage scheme has continued to stimulate retail car sales and the scheme, as PIVE 7, is being continued in 2015. The Spanish Government has allocated €175 million for the scheme this year. This will normally give €2,000 towards the cost of a new car, or €3,000 for families with more than three children. Half of each grant consists of a government subsidy while the remaining 50% is a manufacturer discount.

So much for the retail sector in Spain, has Porter seen a beneficial effect for the fleet sector too? “We have seen growth, not quite the level of growth we would

“We think new i20 will be extremely attractive to the large fleets.”

like.” As he points out, the scrappage scheme means that manufacturers must choose how to allocate their resources to deliver the most sales, either by backing the scrappage scheme or backing other sales. “We have been focusing on our processes and our route to market. As we enter 2015, we are in a much stronger position to continue that growth.”

Hyundai has also experienced fleet growth outside the ‘Big Five’: “We’ve seen growth in Eastern European markets, the Czech Republic and Poland,” he says.

It seems that police forces have found Hyundai particularly attractive, “The number of police tenders we were requested to answer in 2014 was surprising for me,” explains Porter, “It seems that the police forces quite like our cars. We won some significant deals in 2014 and we are hoping to continue that.

“From my perspective, I want to encourage that kind of business. It gives us high visibility and also it is excellent from an aftersales point of view as well.”

Porter says that the growth in police business has been across Europe.

Markets with indigenous manufacturers do not provide many opportunities but otherwise he believes that Hyundai’s total cost of ownership proposition and reputation for reliability and durability has helped to win police business.

SUV fleet sales are also a growth area, “In 2014 alone, the fleet share of ix35 has grown by 37%, which was a surprise for us. Part of that is driven by a change in mind set from fleet purchasers. Where 4x4s and SUVs were previously prohibited, there’s now an opening up and now from a fuel point of view and the snowy winters and this kind of thing, there’s a higher level of acceptance.”

internationalfleetworld.com / 31

FLEET FOCUS France

Diesel decline The French car market picked up in 2014, but is the long French love affair with diesel power coming to an end?

John Kendall finds out.

014 looks as though it might have been the year when the 2 vehicle market in France turned an important corner, after the years following the 2008 financial crisis. Passenger car sales rose by 0.3% compared with 2013 to 1,795,913. Renault registered the greatest number of cars during the year, reaching a total of 353,906, an increase of 4.8% compared with 2013. Peugeot took second place with 305,015, an increase of 5.3% compared with 2013. Not surprisingly, Citroën took third place with a total of 199,385, up 2.4% on 2013. Overall PSA Peugeot Citroën was the largest group on the French car market with a share of 29.9% totalling 536,146 registrations, not helped by a fall in DS registrations of -27.2% to 31,746. Dacia saw registrations rise in 2014 by 14.1% to 102,519.

The two French groups carved up the top 10 best selling cars between them. The Renault Clio was the best seller in 2014 with 105,182 registrations and a 5.9% market share.

The Clio had a comfortable lead over the second placed Peugeot 208 with 83,965 registrations and a 4.7% market share.

The Renault Captur edged the Peugeot 308 into fourth place with 62,985 registrations for the Captur. Dacia broke into the top 10 with the Sandero in 10th place with 44,357 registrations and a 2.5% market share. The Volkswagen Polo was the highest placed foreign car, taking 11th place with 40,407 registrations and a 2.2% market share.

BEST SELLING CARS IN FRANCE 2014 Model

Volume

Market share %

105,182

5.9

Peugeot 208

83,965

4.7

Renault Captur

62,985

3.5

Peugeot 308

60,842

3.4

Citroën C3

59,627

3.3

Peugeot 2008

54,161

3.0

Renault Scenic

49,068

2.7

Citroën C4 Picasso

45,339

2.5

Renault Megane

44,791

2.5

Dacia Sandero

44,357

2.5

Renault Clio

Source CCFA/AAA Data

32 / internationalfleetworld.com

France is predominantly a small car market, with CCFA/AAA data showing that 54% of the cars sold in 2014 were small, 44% were medium sized models with luxury models making up the remaining 5%. Saloons and hatchbacks account for around 53% of the 2014 market, with SUVs taking 23%.

Data also shows that the French are taking to low emitting cars in a decisive way. The market for cars emitting less than 90g/km CO2 has grown from 3.2% of the total market in 2012 to 7.7% in 2014. Similarly, cars emitting between 91 g/km and 130g/km have grown in share from 61.8% in 2012 to 75% in 2014. At the same time, the market for cars emitting above 131g/km CO2 has fallen from 34.9% in 2012 to 17.3% in 2014. That partly reflects the greater number of lower emitting cars that are now available.

FULL SERVICE LEASING ALD manages some 335,000 vehicles in France, representing 22.5% of the country’s full service leasing and fleet management market according to Guillaume Maureau, director general of ALD France. He estimates the total vehicle parc in France at around 38 million vehicles and of these, he suggests that around 5.0m are used for professional purposes.

Of these, he estimates that some 1.5m are operated under full service leasing, or by leet management companies. Alphabet puts the igure slightly lower at around 1.1m, while Citroën’s data was based on the market to the end of November 2014, by which time the company says that 789,800 cars had been registered in France during the course of the year. That would probably bring the inal total, based on those igures to around 860,000. So there is some variation in the estimates, but as we say, it all depends on how the market is calculated.

Overall some 44% of registrations are for business use.

Guillaume Maureau at ALD reckons the business market is made up as follows: “Full service leasing and companies which purchase cars outright, 20%, car rental 9% and direct sales from manufacturers 15%.”

LOYALTY OF FRENCH CUSTOMERS Given that France has an active motor manufacturing industry with The PSA Peugeot Citroën Group representing Peugeot, Citroën and DS, while the Renault Group includes Renault and Dacia, it is not surprising that French manufacturers dominate the French domestic market, with some 75% of business cars being of French origin. Altogether there are some 34 assembly and production plants in France, matching the UK and Russia,

according to data from the European motor manufacturers association ACEA. Besides the French manufacturers, Daimler, Iveco, Toyota and Volkswagen also have plants in France.

Choice of business vehicles tends to follow the general pattern for vehicle sales in France. According to data from the Syndicat National des Loueurs de Voitures Longue Durée (SNLVLD), the trade body representing long term car rental suppliers, in the third part of 2014, the Renault Clio was the best selling lease vehicle, followed by the Peugeot 208, Citroën C3, Citroën C4 and Picasso, with the Renault Kangoo in fifth place.

Among business car users, the SUV is gaining popularity, “The SUV trend is now very strong,” says Guillaume Maureau, “Even in car policies with new models like the Renault Captur.

The Captur is doing very well in fleets, even in large fleets.

This is quite a surprise for us and for Renault. It is doing very well as is the Peugeot 2008. We can see the same trend with the Nissan Qashqai and the Opel Mokka.”

FALLING POPULARITY OF DIESEL France used to have one of the highest penetrations of diesel car registrations in Europe, reaching an average of 73% of the car market in 2012. Since then the mix has changed quite sharply, possibly due to the strength of the small car market in the country and the shift to petrol powered cars among small models. For 2014, the diesel mix had fallen to 64% of the market. That is reflected in the fleet sector too with the diesel share falling and the petrol share rising. According to Guillaume Maureau at ALD, the petrol share has grown from 7.4% in 2012 to 11.7% in 2014.

INCREASED UPTAKE OF EVS & HYBRIDS How much has the market for electric and hybrid models grown? According to Alphabet, in Q3 2014, the leasing market accounted for 16% of electric cars and 13% of the hybrid cars registered and in November, sales of hybrid and electric cars took a 3.5% market share. Citroën suggests that for the January to November period, hybrids took a 1.93% share of the market, while electric cars took 0.64%. “If we speak about full electric,” says ALD’s Guillaume Maureau, “the fleet market has grown from 0.2% market share in 2012 to 0.4% in 2014 having grown to a 0.6% share in 2013. At the same time the share for hybrids has grown from 1.7% in 2012 to 4.0% in 2014.

“The trend is that diesel is going down, petrol is going up and hybrid is doing quite well,” says Maureau. “Electric was doing quite well, but only in the public sectors.”

internationalfleetworld.com / 33

¡

FLEET FOCUS France

Overall PSA Peugeot Citroën was the largest group on the French car market with a share of 29.9% totalling 536,146 registrations

BEST SELLING LIGHT CVS IN FRANCE 2014 Model

Volume

Market share %

Renault Kangoo

33,391

9.0

Renault Clio

26,705

7.2

Renault Master

26,028

7.0

Citroën Berlingo

25,596

6.9

Fiat Ducato

25,596

5.9

Renault Trafic

20,272

5.4

Peugeot Partner

17,448

4.7

Peugeot 208

16,805

4.5

Citroën C3

11,744

3.2

Mercedes-Benz Sprinter

10,313

2.8

Source CCFA/AAA Data

¡

Renault dominated the light CV sector registering 117,823 vehicles in 2014, an increase of 1.3%. Citroën took the 2nd place with a total of 63,233 registrations, up 2.6% compared with 2013. Overall the market rose 1.3% during the year with a total of 372,065 registrations, with PSA Peugeot Citroën taking a 33.1% share of the market and the Renault Group close behind with a share of 32.6%. Even so, Renault had by far the largest slice of the market with 31.7%.

POTENTIAL FOR CAR SHARING “There are no official figures for the French market”, says Alphabet of car sharing schemes in France, “Yet some studies show that this solution should increase strongly in the coming years in Europe: Frost & Sullivan expects that from now to 2018-2020, 80 000 vehicles will be car-shared in European companies. The number of providers should move from 13 to 30 from now to 2020. The number of European companies providing a car sharing solution to their employees should move from 200 in 2013 to 4,000 in 2020. This will represent 0.5 % of the global European business fleets (0.01% in 2013).”

Autolib’ is one of the growing car sharing schemes operating in France with most cars operating in Paris, while the

34 / internationalfleetworld.com

scheme has also expanded to other cities. The scheme uses only electric cars, predominantly the Bolloré Bluecar. Over 2,000 are already in use. Citroën suggests that several large companies are already using car-sharing schemes, such as L’Oréal, Michelin, Airbus and Safran.

Like many other European countries, business cars attract a tax, TVS (“Taxe sur les Véhicules de Société”) calculated according to the carbon dioxide emissions. From 2013, this has been supplemented with an additional component, intended to reflect the atmospheric pollutant effects. This tax is applied differently to petrol, diesel, diesel hybrid, electric vehicles and light CVs. A scale of charges operates to reflect not only the power source but also the age of the vehicle and therefore the emissions from it. Alphabet supplied the following tables to explain the taxes.

FINANCING OPTIONS Alphabet also offers some data on how business cars are inanced.

“Big companies are using long term rental as a major way of financing their fleets: externalising the management of their company cars has been a reality for years now.

“Smaller companies still behave as individuals and finance their vehicles like they would do for their own cars. The market of small companies represents a big opportunity of development for long-term rental!”

CO2 emissions (g/km)

Amount of the Tax in 2014 (applicable per gram of CO2)

Up to 50 g/km

€0

From 51 to 100 g/km

€2

From 101 to 120 g/km

€4

From 121 to 140 g/km

€5.5

From 141 to 160 g/km

€11.5

From 161 to 200 g/km

€18

From 201 to 250 g/km

€21.5

From 251 g/km

€27

IAM REPORT France

Tour de France The Institute of Advanced Motorists offers advice and information for drivers visiting France.

W

hile drivers will no doubt enjoy the wide, smooth roads and largely clear motorways, there are some aspects of driving in France that can catch out the unwary – and the pace of life as a motorist in Paris could be a bit of a shock.

UK drivers must remember to drive on the right and get familiar with the language. A re-commencement of ‘Priorité à Droite’ means ‘You no longer have priority over traffic from the right’ and ‘Priorité à Droite’ means ‘Give priority to traffic on the right.’

The traditional rule that you must give way to any traffic joining the road from the right hand side still applies in urban areas if there is no road sign at a crossing.

This can catch out unwary drivers, and if you collide with traffic joining from the right where there was no road sign, you will be at fault. This ‘priority to the right’ could also be marked with a red triangle sign with a black cross on a white background so if you see these signs you know that the next junction coming up on your right has priority.

To confuse things further, France is slowly moving away from the Priorité à Droite rule and on the open road and town bypasses you will often now see a yellow diamond sign signifying that you have the priority. Conversely on entering a town or village you will see a yellow diamond with a black line through it – signalling the re-commencement of Priorité à Droite so take extra care again. If in doubt, be wary at all road junctions in France. Other important phrases include ‘Cedez Le Passage’ (Give Way) and ‘Vous n’avez pas la prioritié’ (You do not have the priority).

It is also very important to be aware of the speed limit and speed camera situation. There is a two-tier set of speed limits, one set for normal driving conditions and a

second lower set which applies in wet weather conditions – not just when it’s raining, but also when the road surface is wet. They are: motorways – 130km/h or 110km/h if wet; dual carriageways – 110km/h or 100km/h if wet; other roads – 90km/h or 80km/h if wet; built-up areas and towns – 50km/h or as signposted.

Speed cameras are becoming a familiar sight across France and if you’re caught, it means an on-the-spot ine. If you do not have enough money, the gendarme will drive you to the nearest cash dispenser so you can pay up there and then.

For those taking a UK-based vehicle to France, headlamp beam adaptors/converters are compulsory. Even if you only drive in daylight you must correct your headlamps.

Otherwise the vehicle could be deemed unfit for the road and your insurance will be invalid.

A warning triangle must be carried by law in the car, and if you break down or are involved in an accident, the triangle must be placed between 50 and 150metres behind your vehicle to warn other traffic.

High-visibility reflective jackets that comply with EU Standard EN 471 must be carried in your vehicle, and must be easily accessible – so not in your boot. This requirement was made law in France in 2008, and you could face a €90 fine if you don’t comply.

Since 2012, drivers are required to carry an unused single-use breathalyser in the car at all times. The breathalyser must have the NF logo (to show compliance with French regulations), and as the breathalyser must be unused it is a good idea to carry a pack of two.

Finally, radar detectors are strictly forbidden in France. Even possessing such a device in your vehicle, whether in use or not, is illegal and penalties can include a ine of up to €3,000.

internationalfleetworld.com / 35

REMARKETING France

La Revolution Pierre Emmanuel Beau, director Autorola France, says the French car market is showing signs of a mini revolution.

T

he French new car market remained static in 2014 with sales at 1.79m, just below the 1.8m mark for the second year running. Short term rental and company car sales rose 7% and 6% respectively, while private sales fell 2% to 939,000.

The market is still dominated by Renault, Peugeot and Citroën who all reported sales increases in 2014, but Dacia also made its mark rising to the third biggest car brand in France with 9.3% market share, outselling Volkswagen into the bargain.

The Dacia success story also shows signs of a quiet revolution among French car buyers as they are showing signs of evaluating which brand of new car they want to buy, but also reviewing the most effective route to sell their used car.

In 2014 there were three major We Buy Any Car (WBAC) type businesses set up to encourage the private used car seller to dispose of their car directly to a third party trade provider. Autorola has also entered this market. Country volumes of this sector are an estimated 30/40,000 in 2014, well down on the WBAC volumes of 500,000 in the UK, but this remarketing channel is set to grow quickly in France as French used car buyers look to optimise the price for their used car without taking the route of classifieds that doesn’t involve just selling it to a local franchised dealer.

Typically Autorola, in partnership with French automotive valuation leader and media business L’Argus is charging €30 for a detailed car valuation, and selling a consumer’s car through its online tender portal in just three days. Just as importantly, Autorola manage all the paperwork and the collection and delivery of the car to its new owner which is helping the appeal of online selling.

What this signals is an increased confidence by the French buyer in selling used cars online. The seven day, 24 hour approach that comes with online remarketing fits into a busy lifestyle of a driver that does not have the time to spend travelling round dealers trying to secure the best price.

French buyers are also looking at an alternative to selling their used car through the classified sections of magazines or newspapers and with online providers like Autorola they are able to tap into a pan-European buyer base which helps with the speed at which the car is sold and the price.

In 2014 70% of used car sold by Autorola France were exported and 19% of those volumes went to Portugal and Spain. Those two markets were hit hard by the 2009 recession and new car sales reached rock bottom for a number of

36 / internationalfleetworld.com

years, but the improvement in the economy and available finance to private buyers has saw a huge and continuing demand for used cars in this region from early 2013 that the country could not meet.

Autorola is seeing the Portuguese and Spanish market buy predominantly two to four year old used cars from 80150,000km. Station wagons are popular and the Megane size of car is in high demand with this market, set to be big for Autorola in the coming two years as the availability of used cars starts to improve. Other popular export destinations include Poland, Austria, Germany, Holland and Italy.

While the consumer market is predicted as one for growth in 2015, the short-term and long-term rental market are both enjoying increased prices in France caused by a general shortage of used cars. The major manufacturers who are supplying cars into the short-term market are reporting as many as 9095% of stock going back directly into their franchised dealer network such is the demand for good quality used cars.

The increased interest in selling used cars online is prevalent with many OEMs now selling their used cars directly to their dealer networks, generally bypassing physical auction.

Online gives the control and the prices that the OEMs require, and with a reduction in used stock car makers and their dealer networks are only using physical auction as a means to dispose of part exchange stock that they cannot sell within the network.

Keep an eye on the French market as its mini revolution sets to continue in 2015 and beyond.

AUTOROLA 2014 SALES SPLIT BY COUNTRY France 30% Portugal 12% Germany 9% Netherlands 7% Spain 7% Italy 6% Poland 6% Austria 4% Slovakia 3% Belgium 3% Hungary 3% Romania 3% Czech Republic 2% Denmark 2% Others 4%

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ADVICE best practice for running your fleet

NAFA International Fleet Academy

Natural selection 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 9

Fleet vehicle procurement Selecting the most appropriate vehicle is one of the most important functions of a leet manager, and that is why it is imperative to have a good understanding of how to get started. This chapter looks at vehicle selection, including options, pricing and categories of vehicle expenses.

38 / internationalfleetworld.com

Satisfying vehicle requirements There is a difference between meeting the transportation needs of an organisation and satisfying a requirement for a vehicle. In North America, a transportation requirement usually translates into the need to own or lease a vehicle, while in many other countries, alternatives such as public transportation or taxis are preferred. In China, for example, leets are relatively small and even sales personnel rely on public transportation rather than a company-provided vehicle. Still, there is always a need to satisfy vehicle requirements and this can be accomplished in three ways: employeeprovided, company-owned, or company-leased.

A irm must evaluate all factors of each approach and determine which method is best for the company. Differences such as job functions, cargo and terrain are just a few of the considerations that a leet manager must take into account.

In a global environment, the leet manager should also consider government legislation regarding leasing and the availability of vehicles for purchase.

Taxes must also be taken into account and may have a negative impact in countries such as Germany, or a positive one in countries like Mexico.

The main vehicle selection criterion should always be to minimise overall lifecycle costs by looking at the big picture and objectively comparing all options. The question that must be answered is, “How can I reduce the total transportation costs to my organisation?”

Vehicle pricing The price organisations pay for leased or purchased vehicles is subject to many variables, and leet vehicle pricing is different to retail pricing. Fleet managers should understand how to read a dealer invoice as well as differences between ordering from the factory and selecting from dealer stock. The negotiation of discounts from the OEM, leet management company, or dealer also impacts the ultimate vehicle cost.

Pricing terminology differs from country to country and it is very important to clarify the meaning of terms up-front when entering into negotiations. Terms commonly used in North America such as ‘dealer holdback’ or ‘triple net’ may not be well-understood overseas. Not only might terms be different, but the overall complexity of pricing structures differs by territory.

Readers can review the full article – and much more – by purchasing the Global Guide through the NAFA website: www.nafa.org/

Selection factors Function In order to determine Environment Warranties which vehicle is the best option, the following steps need to be followed: Identify Safety Maintainability selection criteria, rank the criteria, FACTORS weight the criteria and score each Image Cost vehicle option.

By following this process, it is possible to tailor an organiMorale Remarketing sation’s vehicle selection to its needs. The analysis Availability might produce the following selection matrix where the weight, or importance, of each criterion is multiplied by a rank given to each item to come up with a score.

The result would be the acquisition of Car B with a total score of 17 and with key advantages in safety, lifecycle costs and driver morale.

Vehicle expense categories In general, vehicle expenses fall into one of three categories: ixed, operating, or incidental.

“In many cases, depreciation will be by far the largest expense.”

Fixed costs: These expenses occur just from having a vehicle. These costs would occur even if you let a vehicle sit in the parking lot and rust. Included in ixed costs are administrative overheads, leet management overheads, licenses and taxes, insurance and depreciation.

In many cases depreciation will be by far the largest expense. It must be noted, however, that this does not apply in all countries. In the cases of Poland and Brazil, to name only two, depreciation is not the largest expense of vehicle operation. Insurance premiums, or subrogation, and other administrative costs for self-insured organisations are also ixed expenses.

Operating costs: These expenses are easier to understand and measure, and include the cost of things consumed as vehicles are used. The more vehicles an organisation has, the more fuel, oil, tires, and mechanical and crash repair costs will be incurred.

Incidental costs: This category of expenses is used for costs that do not it into the other two categories. This includes the cost of washing and parking the vehicles, tolls and other miscellaneous charges.

Next month...

We look at timing vehicle replacement and the challenges of remarketing.

internationalfleetworld.com / 39

PROFILE Opel AG

Small is mighty With full availability of new Corsa and the launch of KARL in 2015, Opel presents its most impressive small car line-up to date.

Alongside a greater focus on its European operation the brand is also targeting global growth through co-operation with Buick, resulting in a positive sales outlook both at home and away‌

“Having a global presence means finding the best fit for different brands in different countries.�

40 / internationalfleetworld.com

Manufacturer Opel Total sales 2014 1,076m Headquarters Rüsselsheim, Germany EU market share 9% No. of models 14

view

from the top

Strengthening European operation

Ian Hucker, director European

According to preliminary igures, Opel achieved its highest end-of-year sales igure since 2011 last year, recording 1,076m vehicle sales in Europe alone. The brand achieved its largest year-on-year sales volume increases in Poland (+ 42%), Ireland (+ 33%) and Portugal (+ 28%), with the Vauxhall brand acting as a cornerstone of Opel’s European sales success.

The launches of Mokka, ADAM and Cascada in 2013 helped drive this sales success as models became more widely available in 2014. Corsa, Opel’s biggest selling car, contributed 84,275 registrations in the UK alone in 2013, ahead of Germany at around 50,000 units, and there were 42,285 new registrations during the irst half of 2014. The new Corsa arrived at dealerships last month, and is expected to contribute to a strong sales uplift in 2015.

“When we look back on 2014 we were just a shade under 10% growth in leet registrations year-over-year so it was a very good year for us,” commented Ian Hucker, director European leet. “Looking forward to 2015, that leet share growth is expected to continue. Full availability of Corsa in 2015 which will have a big impact, and we launched Vivaro at the back end of last year which will be important for our commercial vehicle growth strategy with more conversions and options becoming available. We are investing in our B2B sales forces across all our European markets to help develop our approach to the small business sector.”

Opel announced in September 2014 that its Russian operation would be scaled back due to the unstable economic and political situation. GM also con irmed that it will withdraw Opel from China in 2015, and will invest in Europe to boost the German car brand’s sales in its home region. The carmaker has targeted a market share of 8% in Europe by 2022.

ADAM and Mokka will be introduced to South Africa this year as part of a product and export offensive by Opel, which will see the brand introduce 27 new vehicles and 17 engines in applicable markets by 2018. Opel has seen resurgence in South Africa, with vehicle sales up 54% in the irst seven months of 2014.

GM CEO Mary Barra announced a €245m investment at the Rüusselsheim manufacturing plant last year to enable Opel to move to the next stage of its powertrain offensive, providing funding to develop fuel ef icient engines and transmissions.

GM has also outlined plans to develop greater synergies between the Opel/Vauxhall and Buick brands. “Greater synergy between the brands gives us a broader global footprint for the platforms and vehicles,” Mr Hucker added. “Under the Buick brand, Insignia is rapidly becoming a global vehicle, particularly in America, and we’ve recently announced plans to launch Insignia in Australia under the Holden brand.

‘This is an important part of the strategy going forward, and having a global presence doesn’t really mean taking an Opel product and selling it all over the world; it means inding the most appropriate distribution strategy for the product and inding the best it for different brands in different countries.”

fleet, on Opel’s fleet appeal and the revival of an iconic name.

Opel AG European sales, by country 2012-2013* Territory UK Germany Italy Russia France Total sales

Sales 2012 258,852 224,468 82,806 81,242 78,923 1,049,897

Sales 2013 289,279 217,648 74,242 81,421 65,024 1,040,707

*2014 country-by-country figures TBC. Total sales in 2014: 1,076m.

% change +11% -3% -10% -0.2% -19% -1%

How has Mokka been received by fleet customers?

We are at over 330,000 orders for Mokkas now and still can’t build them quickly enough. We have moved production to Zaragoza in Spain to shorten that logistics chain to be able to deliver them more quickly to customers and Mokka has done particularly well, certainly in 2014, as a user-chooser vehicle. Although SUVs have historically been dif icult to place in leet policy, when you get down to the Mokka and the TCO advantages for a vehicle of Mokka’s size and the powertrains we can offer, it’s a tremendous proposition and we are delighted with the response.

Have new variants of the Insignia broadened its appeal?

We are delighted with how the new Insignia has performed since we relaunched it Q4 2013, and in terms of its segment share we have seen a 40% increase year-over-year in leet for Europe as a whole. We are up to 155,000 orders since launch. Right from its debut, the Country Tourer variant increased awareness of the four-wheel drive on Insignia and broadened understanding of the technical capabilities of the model.

Why has KARL been named Viva for its UK launch?

Building off the positive reaction to the ADAM’s name, for all our Opel markets KARL is the direction we wanted to head in. For the UK, however, Viva has such a strong awareness and recognition that it seemed right to revive it for this particular model and give the Vauxhall Viva a standing start in that segment. Like Opel, for which the KARL name is emphasising its German heritage, it made sense to emphasise the Britishness of the Vauxhall brand and revive this historic name from Vauxhall’s past.

¡

internationalfleetworld.com / 41

PROFILE Opel AG

¡

Where are they made?

Manufacturing plant locations 1

FIN fleet in numbers

85,000 Number of pre-orders for new Corsa by December 2014.

99g/km

CO2 emissions of Opel KARL.

6.5m

Number of customers using OnStar Connectivity worldwide.

42 / internationalfleetworld.com

Rüsselsheim, Germany – Insignia (Sedan, Hatchback and Sports Tourer), Astra 5dr

2

Eisenach, Germany – Corsa, ADAM

3

Gliwice, Poland – Astra Classic, Zafira Family, Astra

4

St. Petersburg, Russia – Astra

5

Figueruelas, Zaragoza, Spain – Corsa, Meriva

6

Ellesmere Port, Cheshire, UK – Astra, Astra Sports Tourer

7

Luton, Bedfordshire, UK – Vivaro

4 6 7 2

3

1

5

Model and powertrain offensive...

Opel recently announced details of its KARL ive-door entry-level model, which goes on sale in Europe this summer. Named after the son of the company founder, the model joins ADAM and Corsa in Opel’s small car line-up and will offer a range of safety and comfort features.

Only one engine will be offered at launch; a new 75hp 1.0-litre three-cylinder ECOTEC engine developed for the model. The Opel IntelliLink infotainment system will also be available, which allows seamless integration of Apple iOS and Android devices.

Towards the end of the year, possibly at the Frankfurt Motor Show, a new British-built Astra will be unveiled ahead of its planned launch in 2016. Previous test models have been spotted performance testing at the Nürburgring and three new engine families (which include 13 individual petrol and diesel units) will be available by the time the new Astra reaches production.

Mokka gains the new 1.6-litre ‘Whisper Diesel’ engine in 2015, bringing CO2 emissions down to 109g/km with 4.1l/100km fuel economy. Already available in the Astra, Meriva and Za ira Tourer ranges, the new engine is gradually replacing the 1.7-litre CDTi across the range, and will be offered in the more powerful 138hp form in the Mokka. It brings the crossover’s CO2 igure closer to key rival – the Nissan Juke – as well as slashing running costs.

GM CEO Mary Barra announced in November 2014 that the Opel plant in Rüsselsheim will produce the brand’s forthcoming new SUV – its second lagship model alongside the Insignia – due to launch in 2020. Based on a Cadillac platform, industry insiders expect the new SUV to be similar under the bonnet to the next generation Cadillac SRX. A new electric vehicle is also under development to replace the existing Ampera range. “We will have a replacement electric vehicle in the range in the future; we are committed to retaining that type of technology in the Opel/Vauxhall portfolio,” con irmed Mr Hucker.

Already a familiar feature in North America, Canada, Mexico and China, GM will bring OnStar Connectivity to Europe in 2015. The system is being built in as standard on every new Opel car except entry-level models, bringing 4G internet access and eCall emergency services to customers. OnStar will also offer vehicle diagnosis reports and telematics features, and will be heavily promoted as part of the company’s leet growth objectives for the year.

Opel fleet model range

ADAM

ADAM ROCKS

Corsa

Variants: 3dr hatchback Markets: Europe, Africa, South America Fuel: 4.2-5.9l/100km CO2: 99-139g/km

Variants: Crossover Markets: Europe Fuel: 4.5-5.3l/100km CO2: 105-125g/km

Variants: 3/5dr hatchback Markets: Europe, Africa, South America Fuel: 3.2-6.0l/100km CO2: 85-140g/km

Meriva

Mokka

Astra

Variants: MPV Markets: Europe, Asia, Africa, South America Fuel: 4.0-7.1l/100km CO2: 105-166g/km

Variants: : Crossover Markets: Europe, Africa, South America Fuel: 4.1-10.7l/100km CO2: 109-257g/km

Variants: 5dr hatchback, 4dr saloon, wagon Markets: Europe, Asia, Africa, South America Fuel: 3.7-7.2l/100km CO2: 97-169g/km

Astra GTC

Cascada

Ampera

Variants: 3dr hatchback Markets: Europe, Asia, Africa, South America Fuel: 4.1-7.8l/100km CO2: 109-184g/km

Variants: Cabriolet Markets: Europe, South America Fuel: 5.2-6.7l/100km CO2: 138-158g/km

Variants: 5dr hatchback Markets: Europe Fuel: 1.2l/100km CO2: 27g/km

Zafira

Zafira Tourer

Insignia

Variants: MPV Markets: Europe Fuel: 5.1-7.2l/100km CO2: 134-187g/km

Variants: MPV Markets: Europe, Asia Fuel: 4.1-7.0l/100km CO2: 119-182g/km

Variants: 5dr hatchback, 4dr saloon, wagon Markets: Europe, Asia, Africa, South America Fuel: 3.7-11.0l/100km CO2: 98-259g/km

coming soon

KARL / Viva Variants: 5dr hatchback Markets: Europe Fuel: 4.3l/100km CO2: 99g/km

Insignia Country Tourer

Antara

Variants: Crossover Markets: Europe, Asia, Africa, South America Fuel: 4.5-8.4l/100km CO2: 119-197g/km

Variants: SUV Markets: Europe, Asia, South America Fuel: 6.1-9.3l/100km CO2: 160-216g/km

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Renault Twingo The Twingo has chic on its side, but is that enough? John Kendall reports.

SECTOR Supermini PRICE €10,800–€15,700 (approx) FUEL 4.2–4.5l/100km CO2 95–105g/km

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enault had a long tradition of producing rearcity streets, this would be a real advantage. engined rear-wheel drive cars, starting with the Renault has opted for a softer appearance than the prepost war 4CV in 1947 and continuing until the vious model, which makes the Twingo look like a slightly early 1970s. The third generation Twingo takes Renault taller Fiat 500. Since the wheelbase has been extended by back to a similar design. Since the Twingo is a city car, the 120mm, there is also more space inside the car than rear engine layout has allowed Renault to shorten the car before, providing more rear seat space too. by 100mm, compared with its predecessor. It shares the Renault offers two engines, both petrol. Most models same platform as the Smart ForFour model and is built will be powered by a 999cc three-cylinder engine producin the same plant in Slovenia, so Renault benefits from ing 70hp – similar to most rivals. There will also be the Daimler’s expertise in building rear engined, rear-wheeloption of a smaller 898cc turbocharged three-cylinder drive city cars too. engine producing 90hp. Despite the additional power, the Renault has also brought its own smart turbo engine returns lower fuel conthinking to the project. Any modern city sumption than the 70hp engine without car needs to be a hatchback and the Stop/Start – 4.3l/100km compared Twingo has been neatly packaged as such with 4.5l/100km with corresponding with the rear engine layout. The two rear CO2 emissions of 99 and 105g/km respectively. With Stop/Start the 999cc seats can be folded to provide a flat load engine returns 4.2l/100km and 95g/km area at the back, while luggage space can on the combined cycle. be increased further by folding the front Our test car was powered by the passenger seat down, extending the same standard 70hp 999cc engine, which flat floor further forward. Renault claims benefits from producing maximum that with the front seat folded, the torque of 91Nm at 2,850rpm, so the Twingo will accommodate a double bass, engine does not need high revs to pull or loads up to 2,310mm long. away, unlike some city car rivals, which The rear engine also permits a much also helps to keep engine noise down. tighter turning circle than a front-wheelWe liked Twingo’s That said, the refinement of the engine drive layout, because the turn angle of cheeky character, and was disappointing. While Renault’s turthe front wheels is not restricted by the the tight turning circle bocharged three-cylinder engine is one limitations of having to power the front of the smoothest, that can’t be said of wheels too. Renault claims the tightest is a real bonus. Not so the 1.0-litre engine, which would make turning circle in class at 8.59m and it is good was the engine the whole car vibrate at tick over. That certainly impressive. I was able to park vibration, or the light is out of keeping with other naturally the car in a tight parking space on my steering at speed. aspirated three-cylinder engines in this drive, where I would not normally be class, such as the Volkswagen up! able to park at all. For anyone parking in

what we think

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Audi A3 e-tron 1.4 TFSI S tronic Audi’s A3 e-tron is impressive, but does it have fleet appeal, asks John Kendall?

SECTOR Lower medium PRICE €36,700 (approx) FUEL 1.5l/100km CO2 35g/km

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fully charged battery, which takes around four hours to ne of the advantages of the Volkswagen Group platre-charge from a household charging point. Using a wallform architecture such as MQB is that when new box or higher charging rate public charging point could models are planned, alternative drive systems are bring that down to around 2 hours 15 minutes, says Audi. designed into the architecture from the outset. Then when Use Audi’s e-tron app and you can monitor the car’s the economics look right, it is comparatively easy to bring charging status from a smartphone. those drive systems to market.

On the road the A3 e-tron offers three hybrid modes as It also means that once one of the Volkswagen Group well as pure electric drive. The hybrid auto mode selects brands has announced a drive technology, then it should electric drive whenever possible, while hybrid hold mode be simple for other group brands using the same archisaves the battery for use later. The hybrid charge mode tecture to introduce the technology too. So Audi has got uses the engine to re-charge the batteries. in first with plug-in hybrid technology in the shape of the All the information relating to charge Audi A3 e-tron, and Volkswagen will foland range is displayed in the instrument low in 2015 with the Golf GTE, using the cluster with energy flows displayed in same architecture. the MMI navigation monitor screen. Audi The end result is a petrol electric quotes an unladen weight of 1,540kg for hybrid, using technology that is fairly the five-door hatchback, so the car does familiar already from cars such as the not carry a great weight penalty for the Mitsubishi Outlander PHEV. In the electric motor, batteries and control syscase of the Audi, the car is powered tems. Boot space is reduced to 280 litres by a modified 150hp version of the with the back seats in place, though.

Volkswagen Group 1.4-litre TFSI turOn the road, the A3 e-tron drives like bocharged, direct-injection petrol any other A3 equipped with the 1.4-litre engine paired with a 75kW electric TFSI engine and S tronic transmission. motor, which has been integrated into a The car will be attractive to users where specially developed variant of the S there are tax advantages for low CO2 tronic six-speed twin-clutch automated The A3 e-tron is a good emissions and in low emissions zones transmission. Using the EC standard for if expensive option for and also where there are Benefit-inplug-in hybrids, the official combined drivers who mostly Kind tax advantages for the driver. But fuel consumption is 1.5l/100km with drivers covering long motorway disCO2 emissions of 35g/km. How many cover commuting tances are likely to be better off with a drivers are likely to get anywhere near distances. Using diesel still. The e-tron will show its the fuel consumption figure? Probably electric power will advantage for drivers who usually cover not many, but we recorded fuel conbenefit running costs. short distances where the electric drive sumption similar to diesel models. system can be used most of the time.

Audi quotes a range of 50km on a

what we think

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Volkswagen Passat An enduring fleet favourite just gets better, reckons John Kendall.

SECTOR Upper medium PRICE From €25,875 (approx) FUEL 4.0–5.4l/100km CO2 106–140g/km

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evealed in Potsdam last July, before going on sale in car then automatically steers the car the right way.

Germany in November 2014, is the eighth generaTrafficJamAssist and Emergency Assist both use the tion Passat. It looks like a Passat inside and out and autonomous emergency braking capability to automatidrives like one, but there’s no doubt that a great deal of cally drive in traffic, speeding up and stopping automatiwork has gone into its development. Just sitting behind the cally. Emergency Assist monitors driver behaviour and if wheel for a few minutes shows that build quality would he or she starts to respond in a way that suggests a mednot shame an Audi model. ical emergency, the system brings the car to a halt and As Volkswagen reminded us, the car is completely new. alerts other drivers to a possible problem. MirrorLink can Although some engines are carried over, they are all engireproduce a connected smartphone on the Passat’s display neered to meet Euro 6 emissions limits. These include 1.4screen and allow selected apps to be used on the move. litre and 2.0-litre TSI petrol engines, with power outputs We drove a range of diesel powered Passats at the launch. of 125hp, 150hp, 180hp, 220hp and As we said, it behaves as you would 280hp. There will also be a plug-in expect a Passat to behave, with refined hybrid GTE model with 1.4-litre TSI and responsive power units. Volkswaengine. Diesel options will include gen’s suggestion that interior space is 120hp 1.6 and 2.0-litre TDI engines improved seems to be true. It might be with 150hp and 190hp, as well as a new lower, but there is plenty of room inside 2.0-litre bi-turbo TDI diesel developing and interior space feels generous. The 240hp, available only with 4motion new 240hp bi-turbo is particularly four-wheel drive and DSG transmission. refined and well suited to the standard Overall, the saloon is around 2mm DSG transmission. It’s a good car for shorter than the previous model at those who want performance and han4,767mm. The wheelbase has been dling, but want to keep a low profile. lengthened by 79mm to 2,791mm, benTrailerAssist will be welcomed by anyefitting interior space. It is also 14mm one who tows regularly but finds reverslower and 12mm wider. Despite that, ing a trailer difficult. The system really The latest Passat Volkswagen claims that there is more does take the difficulty out of reversing. is the best to date, interior space, with better leg and headThe new Passat is up to 85kg lighter offering a quality car room, as well as more luggage space. than its predecessor, helping to reduce The car comes with a host of technology fuel consumption along with a range of that’s enjoyable to options, including CarNet connectivity via measures including reduced friction in the drive or be driven in. smartphone or on-board SIM card. Trailengines. Fleet drivers will probably beneNo fleet driver would erAssist makes reversing a trailer simple, fit from the flexible service option, which be disappointed. by using the mirror adjustment control to extends service intervals to between select which way you want to reverse, the 15,000km to 30,000km approximately.

what we think

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Citroën Berlingo XTR+ The Berlingo XTR+ offers enhanced traction, without four-wheel drive complexity, reckons John Kendall.

SECTOR Small panel van PRICE €18,200 (approx) FUEL 5.0l/100km CO2 132g/km

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than many users are likely to need. The locking differential itroën was the first van manufacturer to recognise gives the Berlingo off-road capability that comes close to that while relatively few light CV operators need the four-wheel drive models, although ultimately the lack of cost and complexity of four-wheel drive models, there low ratio gears and a second driven axle would limit it. are fleets that need enhanced traction capability. This might Power comes from the jointly developed PSA/Ford be because their vehicles occasionally need to be driven on 1,560cc common rail, four-cylinder diesel engine develun-surfaced roads, or need to maintain traction in places oping 90hp with 215Nm of torque, developed at a usefully where there is occasional snow and poor weather. Fleets that low 1,500rpm. Even in XTR+ guise, the van recorded may need these capabilities include those operating in the 5.0l/100km on the EU combined cycle and recorded CO2 utilities, forestry, construction or agricultural sectors. emissions of 132g/km.

The XTR+ enhanced traction option was first launched As well as impressive off-road ability, the XTR+ offers a with the previous Berlingo model. It is based on the braked towing weight of 1,050kg. On the shorter L1 model with the lower payroad, it is difficult to detect any differload option, giving a gross payload of ence between the XTR+ and the standard 661kg. Modifications include a limited L1 Berlingo. The 90hp 1.6 HDi diesel slip differential to help maintain tracengine provides adequate performance, tion, 30mm raised ground clearance although the lack of a standard fit fullwith heavy duty suspension, revised height bulkhead means that noise enters steering geometry and comprehensive the cab from the load area, which would under-body protection to prevent be tiresome for long distance use. That against damage when used off-road. said, a specialist user of the XTR+ is These consist of a sump guard and two unlikely to travel too far in the vehicle. longitudinal skid plates to protect comOne advantage of the standard bulkponents such as the brake and fuel lines. head arrangement is that longer loads Up to 75% of drive torque can be transcan be accommodated with the folding mitted to the wheel with the most grip passenger seat, which folds down to by the limited slip differential. Specially The Berlingo XTR+ has form an extension to the load area. The selected tyres and 15-inch wheels make no rival this side of a standard load area length is 1,800mm up the final part of the specification.

4x4 vehicle but offers a but narrower items such as ladders up None of this is visible from the drivto 3,000mm long can be carried with ing seat. There are no additional concheaper, less complex the passenger seat folded. trols in the cab to suggest that this alternative for those Citroën is no longer the only van maker Berlingo is any different from any other. who need occasional to offer a dual passenger seat for this size Experience with the model on a preoff-road capability. of van but for short journeys it gives the pared off-road course shows that its offoption of carrying a second passenger. road capabilities are probably better

what we think

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MANAGEMENT Global Fleet Forum

global

Join the

connecting the international fleet community

The sweet smell of cartel: why truck makers oppose cleaner and safer lorries Jos Dings, Director, Transport & Environment

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:

theglobalfleetforum.com

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Margrethe Vestager, European competition commissioner, has announced that she is stepping up the anti-trust and cartel investigation against EU truck makers. The Commission suspects several truck makers of price fixing and anti-competitive behaviour.

Formal charge sheets have been sent to several manufacturers that the Commission suspects of price fixing, marking the next phase of a complex investigation that began with raids on a number of companies’ headquarters back in January 2011.

Companies could be fined up to 10% of their annual revenue if the Commission concludes that there is sufficient evidence of an infringement of EU rules barring cartels and the abuse of market dominance.

The Commission move did not come as a surprise to T&E. There’s something fishy about the world of truck manufacturing with only four major groups in Europe (Daimler, Volvo-Renault, MAN-Scania, DAF and, to a lesser extent, Iveco) and no competition from the US or Japan.

Take, for example, the fact that fuel economy has stagnated for the last 20 years. In a business where fuel costs amount to one-third of operating costs of a haulier you would expect cut-throat competition to deliver the most fuel-efficient models.

But new truck fuel economy is very similar for all brands (as are prices). Industry tests show the difference between comparable models is very limited.

And then there’s the discussion about new truck design rules. In 2013, the Commission proposed that truck makers should be permitted, but not required, to build slightly longer, curvy cabs that are more fuel efficient, emit less CO2 and are safer by providing much improved direct vision.

The proposal would allow cabins with a rounded shape and for the use of aerodynamic flaps at the back the trailer.

The Commission claimed that these changes could save approximately €5,000 per year in fuel costs for a typical longdistance lorry covering 100,000km. This represents a 7-10%

debate...

in association with

Meet the experts...

Antonio Avenoso, Executive Director, European Transport Safety Council cut in greenhouse gas emissions (or 7.8 tonnes of CO2 for the same long-distance lorry covering 100,000 km).

Commission vice-president, Siim Kallas, said: “A brick is the least aerodynamic shape you can imagine, that's why we need to improve the shape of the lorries on our roads. These changes make road transport cleaner and safer. They will reduce hauliers' fuel bills and give European manufacturers a head-start in designing the truck of the future, a greener truck for the global market.”

But truck makers want to retain ‘competitive neutrality’. They fear that one of them would benefit more from the new opportunity so they’ve collectively decided that no-one should benefit for at least another decade. Could you imagine any other industry opposing the freedom (not obligation) to innovate?

The truck makers’ position that we need a 10-year moratorium smells of cartel.

It’s good news that all of this comes to the surface now.

The new Commission is thinking about how to reduce truck CO2 emissions and Parliament and Council are in the final stage of negotiations on truck design rules.

On truck CO2 the message is quite clear. The previous Commission’s assumption that better information will solve the problem is no longer credible. It’s not that hauliers don’t choose the most efficient vehicles – the problem is that the truck makers don’t provide sufficient choice. So the EU should follow the example of the US and introduce CO2 standards as soon as possible.

On the truck design rules the picture is even clearer.

Prohibiting safer and cleaner designs to maintain ‘competitive neutrality,’ as ACEA wants, is absurd and anti-competitive. France and Sweden, the primary cheerleaders of the truck industry in Council, need to rethink their position. And if they don’t, the Commission, Parliament and other Member States should outvote them.

It’s time for a breath of fresh air and the new truck design rules can provide just that.

Antonio is currently executive director of the ETSC, where he has been working since 2001. Founded in 1993, the ETSC is a non-profit organisation based in Brussels and dedicated to reducing the number of deaths and injuries caused by road accidents in Europe.

Within the ETSC, he has managed several international research projects and road safety programs.

Alex Grant, Deputy Editor, Fleet World Group Trained on Cardiff University's renowned Postgraduate Diploma in Motoring Magazine Journalism in Wales, Alex is an award-winning motoring journalist with eight years' experience across b2b and consumer titles. A life-long car enthusiast with a fascination for new technology and future drivetrains, he joined Fleet World Group as a motoring editor in April 2011, contributing across the magazine and website portfolio and editing the EV Fleet World website. He was appointed deputy editor in 2013.

Dean Bowkett, Technical Director and Chief Editor, Eurotax Glass’s Group Dean is responsible for the consistency and quality of residual values across the Eurotax Glass’s Group.

He has also been a keen advocate for the closer integration of data and information across markets to provide a more rounded view of the industry and thus enable better informed decisions to be made.

He is a Fellow of the Association of Chartered Certified Accountants and has over 23 years’ experience within the automotive industry.

internationalfleetworld.com / 49

fleet in figures

Global sales forge ahead Global light vehicle sales had a good year in 2014, but economic difficulties around the world are expected to limit growth in 2015, reports John Kendall.

US trucks The light truck sector is the backbone of the US light vehicle market with sales reaching 8.7m during the year.

2

014 appears to have been a good year for the motor industry around the world. Western European car sales grew overall, North American sales increased, sales in Japan experienced an uplift and sales in China grew strongly.

Even so, most commentators are expressing caution. Growth in 2015 is not expected to be as strong.

Western Europe Data from the European motor vehicle manufacturers association ACEA shows

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that for 2014, passenger car sales in the EU grew by 5.7% compared with 2013 to 12,550,771. As ACEA points out, this is the first time since 2007 that new car registrations have increased and for the previous six years, car registrations across the EU have been in decline. Percentage growth was greatest in Spain where registrations grew by 18.4% to 855,308. The Spanish PIVE scrappage scheme has helped to accelerate new car sales and the scheme will continue in 2015.

Commenting on the results, LMCA Automotive said: “The 2014 result still leaves the market 2.7m units below the 2007 result, highlighting the scale of the contraction in new car sales in the region since the start of the financial crisis. All Big Five markets in the region improved on their 2013 totals (though, in the case of France, it was a close call); however, the evolution of some market selling rates in recent months has disappointed. West European registrations in the region grew 3.6% in December,

though many markets had the added benefit of an additional selling day versus December 2013. With the economic and political picture looking far from rosy, we forecast somewhat slower growth for the region for 2015.”

The UK market’s consistent performance was noted by LMCA, “The UK market has been the star performer in Western Europe this year, adding over 200,000 units to the 2013 result. The last few months have seen the selling rate continue to climb, indicating a strong start to 2015 too and while we do not forecast growth to continue at the same pace this year, OEMs could well continue to look to the UK as a source of relief from tougher market conditions elsewhere in Europe.”

As we have noted, the Spanish market performed particularly strongly, although it had suffered some of the sharpest declines in the earlier years of the European financial crisis, “Spain continued to pick up well through last year, and selling rates above 900,000 units/year in recent months bode well for the start of 2015,” comments LMCA. “The on-going use of the PIVE scheme will be key to supporting market volumes.”

Germany suffered a small decline in the market in 2013 and both France and Italy have been among the larger casualties where new car sales are concerned, through the crisis years. “In Germany, registrations grew well last year, though selling rates in recent months have been a little disappointing,” says LMCA, “The run in at the end of 2014 was also weaker for France where consumer confidence continues to struggle. With a lack of economic growth, the Italian market remains at very low levels by historical standards – little improvement is expected this year as the economy continues to stall.”

Canada Both the Canadian and US light vehicle markets closed the year with strong sales, according to data from Scotiabank.

The bank reports that in Canada, Decem-

ber sales rose 16% compared with December 2013. This saw the 2014 Canadian light vehicle market close on a total of 1,851,000, with Chrysler, Ford and GM all experiencing gains over 30% compared with December 2013.

USA Light vehicle sales totalled some 16.4 million in the US during 2014, up from 15.5m in 2013. As usual, the light truck sector is the backbone of the US light vehicle market with sales reaching 8.7m during the year compared with 7.7m for passenger cars. Commenting on the December sales, Scotiabank said, “Importantly, volumes closed 2014 on a high and did not weaken significantly from the promotion-induced level of the previous month.”

Scotiabank is forecasting another strong year for both Canada and the US, with sales expected to reach 1.85m in Canada and 17.0m in the US. The bank notes, “Buying activity continues to be buoyed by improving economic fundamentals, including a strengthening labour market, low interest rates and the recent sharp slide in gasoline prices. Last month’s solid performance lifted full-year sales to the highest level since 2006 and further gains are expected over the coming year alongside rising pent-up demand. In fact, 2015 will represent an unprecedented sixth consecutive annual gain for the U.S. auto market, with sales totalling 17m units – the highest level since 2001.”

2014 to 4,699,590, according to data from the Japanese Automotive trade organisation JAMA. Commenting on the result, LMCA said, “In Japan, the selling rate surged to a robust 6.2m units/year in December, the highest rate since January 2014 (before the April consumption tax hike). Winter bonuses among large corporations increased for the second successive year in 2014, which, along with the rising Tokyo stock market, helped boost sales.”

South Korea Light vehicle sales were strong in South Korea too. According to LMCA sales exceeded 1.6m units for the first time since 2002.

Russia Russian vehicle sales were affected by both the falling price of oil and European sanctions over Ukraine. The Association of European Businesses Automotive Manufacturers Committee held its annual press conference in January and AMC Chairman, Joerg Schreiber, announced the AMC forecast for 2015: “2014 ended with a strong finish, but with a cumulative volume loss of 10%, remains a disappointing year for the Russian car market. In the face of the looming recession, expectations for 2015 are even lower: Our forecast for the total market of PC and LCV next year is 1.89m units, equivalent to a -24% contraction of the market on a year-on-year basis.”

China

South America

LMCA suggests that preliminary data for China indicates a strong end to 2014, with light vehicle sales reaching 23.7m units, up 8.3% on 2013 and representing the highest ever sales in the country.

Passenger cars were the winner, says LMCA, with light CV sales falling for the fourth consecutive year.

South America has also faced economic difficulties, which have had an impact on the market in Brazil and Argentina.

Data from LMCA shows that for the two markets combined, light vehicle sales fell by -11.3% in 2014 to 3,972,534.

This represented a second year of decline for Brazil. Commenting on Argentina, LMCA said, “The market shrunk by nearly 30% in 2014 and is showing little sign of recovery.”

Japan Passenger car registrations rose 3.0% in

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The New Generation Hyundai i20

A boost for your fleet.

A brake on your costs.

Our New Generation i20 combines a wealth of virtues that are rare in this class of car. Within its surprisingly spacious interior, drivers will appreciate the availability of large car features like the wide-opening sunroof, Lane Departure Warning System, heated steering wheel - even cornering lights. And you will welcome the comfortably low cost of ownership together with our reassuring 5-year unlimited mileage warranty. The Hyundai i20. Inspiration. Engineered.

Combined Fuel Consumption: 3.2 - 6.7 l/100 km, Combined CO2 Emissions 109 - 155 g/km. The 5-year unlimited mileage warranty is valid in all EU member states + EFTA. Warranty is subject to local terms and conditions. For taxi or rental usage model specific restrictions apply. For more information, visit www.hyundai.com/eu