International Fleet World May 2012 by Fleet World Group

MAY 2012

internationalfleetworld.com

INTERNATIONAL

FLEETW RLD Essential Business Information for International Fleet Decision Makers

inside Sub-100g/km fleet Dream or reality?

Multi-tasking Alphabet’s expansion

SWOT Hyundai i30

CLEANING UP How GM’s European operation is looking to cleaner cars and Eastern Europe for growth in the fleet sector

The new

Insignia BiTurbo

Tame your right foot. The best car we’ve ever built. Now with the powerful and frugal BiTurbo diesel engine. 400 Nm. 230 km/h. With 4.9 l consumption.

www.opel.com/insignia Official fuel consumption urban 8.6–6.1 l/100 km, extra-urban 5.4–4.2 l/100 km, combined 6.6–4.9 l/100 km; CO2 emissions combined 174–129 g/km (according to R (EC) No. 715/2007). Efficiency classes C–A

MAY 2012

internationalfleetworld.com

INTERNATIONAL

FLEETW RLD Essential Business Information for International Fleet Decision Makers

inside Sub-100g/km fleet

INTERNATIONAL

FLEETW RLD

Dream or reality?

internationalfleetworld.com

Multi-tasking Alphabet’s expansion

SWOT Hyundai i30

CLEANING UP How GM’s European operation is looking to cleaner cars and Eastern Europe for growth in the fleet sector

Publisher Ross Durkin ross@fleetworldgroup.co.uk Editor John Kendall john@fleetworldgroup.co.uk Deputy Editor Natalie Wallis natalie@fleetworldgroup.co.uk Motoring Editor Alex Grant alex@fleetworldgroup.co.uk Sales Director Anne Dopson anne@fleetworldgroup.co.uk Sales Executive Darren Brett darren@fleetworldgroup.co.uk Circulation Manager Tracy Howell tracy@fleetworldgroup.co.uk Production Manager Luke Wikner luke@fleetworldgroup.co.uk Designers Tina Ries tina@fleetworldgroup.co.uk Samantha Hargreaves sam@fleetworldgroup.co.uk Internet Editor Luke Durkin durks@fleetworldgroup.co.uk

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 fleetworldgroup.co.uk

STAG Publications

VIEWPOINT

CONTENTS

It’s not that difficult to dismiss electric vehicles as niche or inadequate. I attended a light commercial vehicle round table event at the end of last year where industry and fleet players dismissed them in less than a minute. The arguments were familiar – range was inadequate for most fleets, re-charging times too long and cost is too high. So it was interesting to hear Dr Paul Nieuwenhuis of Cardiff Business School describe ‘range anxiety’ as something of a red herring – that its importance is overstated. Why? Because there are fleet operators for whom electric vehicles would work fine and these users would not spend money on EVs if range were a problem for them. These could be delivery operators whose vehicles are on ‘back-to-base’ duty cycles – whose daily distances are within the range that EVs offer. Then there are those who commute over short distances and stay in one place for the working day, somewhere where re-charging points could be easily installed. The long-awaited launch of the Renault Twizy could provide an answer for them - a vehicle that could be re-charged during the working day and whose size is ideally suited to commuter use. Then there’s the series hybrid or range extender like the Chevrolet Volt and Opel Ampera which uses an internal combustion engine just to drive a generator and produce electricity, overcoming the range anxiety issue. Where GM has led, others will be following, using small engines such as the Fiat TwinAir and new Ford 1.0-litre Ecoboost. The internal combustion engine will be with us for some considerable time yet, because we still haven’t found anything with similar power density and user friendliness. Used in electrically propelled vehicles, they could play a significant part. So the EV is here to stay. Battery capacity is likely to improve considerably by 2020, bringing step improvements in range and reductions in cost too.

04 News Analysis 10 New York International Auto Show 12 The Sub-100 Fleet Is running a fleet with average CO2 emissions of under 100g/km a dream or reality?

18 EV News Analysis The latest from the EV Fleet World.

20 Fleet Strategy European residual value confidence.

24 Interview Christian Wattenberg of Volkswagen on the expanding market for 4x4 LCVs.

26 Fleet Focus: SPAIN 30 Operator Profile ALPHABET

34 Fleet Profile OPEL/VAUXHALL

38 2012/13 Fleet Calendar 39 Launch Report Opel Ampera / Kia cee’d / Peugeot 208 / Mercedes-Benz E-Class Hybrid.

46 S.W.O.T. Hyundai i30

48 Fleet in figures 51 Industry Analysis Dieter Fess looks at motor manufacturer mergers and the potential benefits.

12 26 30 42

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John Kendall Editor

IFW May 2012

news analysis

Strong fleet sales expected for Ampera Ian Allen is Manager Environmental Strategy & Ampera for GM’s Vauxhall brand in the UK, and closely involved with the launch of Ampera there. We caught up with him at the UK launch of the car and started by asking him how much he had been able to draw on the experience of the Chevrolet Volt launch in North America and Opel Ampera in Europe. ”I think, in the first year of sale there have been around 12,000 Volts on the road, then because of what happened – not at the crash test itself, but three weeks after the crash test – that had a knock on effect in terms of the European deliveries, in that none of them were able to be delivered until the rigidity of the battery was improved.” IFW understands that following any serious impact, such as the Volt US safety tests, the batteries should have been discharged to avoid the possibility of fire, but this had not been done and the vehicle subsequently caught alight. ”In the event of an incident that compromises the battery, as in the cooling system stops operating, unless you discharge the battery to a minimum level of 10%, then unfortunately, the chemical reaction still happens and the battery starts to heat up”, said Ian. ”In the first instance, they left it for three weeks in a compound and eventually, it caught fire. There’s no issue at point of impact in terms of safety.” Given the relatively high price of the car in the UK (starting from €36,709 even with the UK Government electric vehicle grant of €6,120/£5,000), it’s not surprising that fleet is expected to play an important role in Ampera sales. ”I would imagine that there will be a lot of leasing customers. In terms of fleet to retail, we would think that 75- 80% of our customers in the first years will be fleets or public sector companies who are either looking to improve their carbon footprint or be seen to be improving their carbon footprint, so that’s the way that we would envisage the first split of our volume.” Although the Ampera has low carbon dioxide emissions, the comparatively high price means it will not be competing with equivalent sized low emission models. What cars are Ampera

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customers likely to be driving at the moment? ”We expect a lot of them to be coming from premium models that company employees have on their choice lists, either at the request of their company which is making EV choices, or making that choice themselves. It may be that until now, their options have been limited to hybrids or some of the pure EVs that have come to market and I think Ampera opens up a whole new segment to those particular buyers. We’re looking to try and tempt some Audi and BMW drivers over to Vauxhall through this vehicle.” Vauxhall expects to sell around 3,000 Amperas in 2012 and around 5,000 in a full year in the UK. ”As with everything in the electric vehicle industry, there’s still a little bit of guesswork involved”, reckons Ian.

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Mercedes-Benz unveils Citan Mercedes-Benz has revealed more details of its new Citan small van. Based on the Renault Kangoo platform, thanks to a joint-venture agreement between Mercedes-Benz’s parent company Daimler and the Renault-Nissan Alliance, it represents the Three Pointed Star’s first significant foray into the high-cube van market. Mercedes opted to unveil the vehicle at an event held in Amsterdam in the Netherlands on the eve of the revived Amsterdam Commercial Vehicle Show, but elected not to display it on its stand. The Amsterdam RAI Show is no longer ranked as an international exhibition so Citan will make its public debut at the IAA Commercial Vehicle Show in Hanover, Germany in September. Citan uses the same cargo box, basic cab structure and the same engines and gearboxes as the Kangoo, but has been given a completely restyled front end plus a reworked cab interior. Mercedes has installed its own seats and altered the dashboard, steering and suspension system. The diameter of the latter’s torsion bars has been increased and the spring rating altered with the aim of providing a firmer ride and reducing body roll. Power comes courtesy of a 1.5-litre common-rail diesel engine, rated at 75hp, 90hp or 110hp with a particulate filter as standard and married to either a five- or a six-speed manual gearbox: an automated manual gearbox is not available at present. A 114bhp supercharged petrol engine is also on offer. Three overall lengths are available – 3.94m, 4.32m, and 4.71m – along with three gross weights giving Citan a load cube of up to approximately 4.0m3 and a payload capacity of up to around 800kg depending on the model selected. Gross weights go up to 2,200kg and electro-hydraulic power steering is standard. Buyers can opt for either twin asymmetric rear doors or a tailgate with a rear roof flap available as an option, so that over-length items can be accommodated. Roof rails are available at extra cost too. Another option familiar from Kangoo is the ability to fold the front passenger seat completely flat, swivel the section of mesh bulkhead behind it through 90 degrees towards the driver, then lock it into position to extend the load bed. The newcomer will be produced as a standard van and as two different types of five-seater crew carrier, each with a folding rear bench seat. Adaptive ESP is included in the price in all cases as part of a comprehensive safety package that embraces ABS, Acceleration Skid Control, Traction Control System, and Vehicle Dynamic Control, which counters over- and under-steer. Other standard features include a driver’s airbag, a gearshift indicator, a height-adjustable steering wheel and remote central locking.

A BlueEfficiency low-CO2 package will be available that will include Stop/Start –presumably the same Stop/Start system that Renault unveiled in Kangoo at the RAI show – and low-rolling-resistance tyres. Again in line with Kangoo, an electric Citan looks set to appear, but one that will run on compressed natural gas looks highly unlikely. Rather more likely is a 4x4 with an eye to competing with Volkswagen’s 4x4 version of its Caddy. While the prominent star on Citan’s front grille screams Mercedes, and along with the new bonnet, bumper, grille and headlamps gives the vehicle a distinctive face, when viewed from a rear three-quarter angle it is clear that the smallest van in the Mercedes line-up is closely based on Kangoo. Prices are likely to be pitched somewhere between those of Kangoo and Caddy – but closer to Caddy – when Citan goes on sale in left-hand-drive markets in mainland Europe in the autumn, with service intervals set at up to 40,000km/two years.

IFW May 2012

news analysis

Record Q1 European sales for Hyundai A record number of Hyundai cars were registered in Europe in Q1 2012, the company claims. Registrations reached 114,571, giving a Q1 European market share of 3.3%. Figures from the European Automotive Manufacturers Association, ACEA suggest that Hyundai Q1 registrations were 12.5% higher than in Q1 2011, against a European market down 7.3%. Models built at the company’s plant in the Czech Republic at Nosovice, – the i30, ix35 and ix20 – represented over 50% of the registrations.

Audi buys Ducati Motorcycles The Volkswagen Group can now claim to build everything from motorcycles to heavy trucks, as it announced that it was buying Italian motorcycle manufacturer Ducati, pending authorisation from the competition authorities. The supervisory boards of both Audi and Volkswagen approved the deal on 19 April. Ducati has established a reputation for building high performance motorcycles and is well known for the use of desmodromic valve-gear in its engines, which opens and closes the inlet and exhaust valves mechanically without the use of springs. The company joins two other Italian brands, Lamborghini and Italdesign within the Audi division of the VW Group. ”Ducati is known worldwide as a premium brand among motorcycle manufacturers and has a long tradition of building sporty motorcycles”, commented chairman of the Audi board of management, Rupert Stadler. ”It has great expertise in high-performance engines and lightweight construction, and is one of the world’s most profitable motorcycle manufacturers. That makes Ducati an excellent fit for Audi.” The company has manufacturing facilities at its headquarters in Bologna and in Thailand. Asia is a region expected to show significant growth in motorcycle sales in the coming years. Ducati sold around 42,000 motorcycles in 2011, generating around €480 million in revenue, while employing some 1,100 people.

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MAN reports record year ”We want to continue growing profitably and to be the world’s most successful commercial vehicle manufacturer,” said truck and bus manufacturer MAN SE CEO Dr Georg Pachta-Reyhofen (pictured left), addressing the recent Annual General Meeting. He reported that the 2011 fiscal year was one of the most successful in the company’s history with record revenue of €16.5 billion, up 12% on 2010. The company also recorded an operating profit of €1.5 and earnings before tax of €1.1bn, on net income of €247 million. At €17.1bn, order intake rose by 14%. Turning to 2012 Q1 figures, order intake was €4.4bn and revenue slightly up at €3.8bn on sales of 35,000 vehicles. Operating profit for the MAN Group in Q1 was around €250 million, representing a year-on-year decrease of around 20%, attributed to strong competition in several markets. ”We will counter this with measures to boost profitability and efficiency,” pledged Dr Pachta-Reyhofen. ”We still see an increasing demand for transportation and energy, especially in the emerging economies. Because unless they resolve key transportation and energy issues, these economies cannot grow any further. This is precisely what we are counting on with our BRIC strategy, and have secured ourselves market access to the key markets of the future in good time,” continued Dr Pachta-Reyhofen. ”The opportunities to cooperate with Volkswagen and Scania that are now available will give us fresh impetus. Cooperating in purchasing, development, and production will enable us to leverage the necessary synergies to tackle the competition head on.” MAN expects commercial vehicle revenues to decrease by up to 5% in 2012. ”Due to the predominance of the commercial vehicle arm, we expect a slight decline in revenue for the MAN Group as a whole, which will lead to a drop in operating profit. Return on sales is likely to remain at the average long-term target of 8.5%,” he concluded.

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Volvo launches new diesel engine and cuts diesel CO2 emissions From the 2013 model year, most diesel powered Volvo S60, V60, V70 and S80 models will emit less than 120g/km of carbon dioxide. All manual transmission models will emit between 114g/km and 120g/km of CO 2. This covers all models from the S60 powered by the D2 115hp engine, to the S80 powered by the 215hp D5 engine. Volvo has also launched a new entry-level 136hp five-cylinder 2.0-litre turbocharged diesel, badged D3, which will be available in the S60, V60, V70 and S80 models. The current 163hp D3 will be re-branded D4. Production for 2013 model year S60, V60, XC60, V70, XC70 and S80 models will begin in May 2012. The company has also upgraded its Sensus infotainment system to offer road sign recognition, active high beam and tunnel detection.

Global passenger car market will grow in 2012 Automotive data supplier Polk is predicting growth in all global passenger car markets in 2012, except Western Europe. The company expects growth to approach 7% in 2012 and revised its forecasts in March. Growth in Argentina has been significantly downgraded by 110,000 units, resulting from the country’s economic problems. Rising demand in India means Polk expects an additional 300,000 sales in the country this year. Polk also expects to see additional growth in Russia and the US by an additional 50,000 units each and an additional 70,000 in Japan. Sales in the Asia/Pacific region are expected to grow by 12% in 2012, thanks to growth in Japan and China, although the market in South Korea is expected to decline slightly. Polk forecasts sales of 16.427m for NAFTA in 2012 including light trucks, with further growth to 17.773m in 2013. Growth in Russia is expected to boost Eastern European growth by more than 8% in 2012 to 4.772m, rising to 5.132m in 2013. A 5% decline is forecast for Western Europe, following the trend of the past two years. This will bring European sales down to 12.131m, with recovery to 12.599m forecast for 2013. Only Germany is expected to see registrations grow this year.

VW shareholders approve 36% dividend increase Voting at the 52nd annual general meeting of Volkswagen approved a dividend of €3.00 for preference shares and €3.06 for ordinary shares, by a 99.9% majority, meaning that some €1.4 billion will be distributed in dividends. Shareholders also approved the issuing of some 43 million more ordinary and preference shares over the next five years. The board of management was also authorised to repurchase up to 10% of shares within the next five years. Ferdinand Piëch was returned for a further term on the supervisory board and his wife Ursula Piëch was also elected to the supervisory board, replacing Dr Michael Frenzel. Dr Piech was subsequently returned for a further term as chairman of the supervisory board. He is a grandson of Porsche founder Ferdinand Porsche.

Record production at Kia Slovakia plant Kia’s Slovakian production plant at Zilina built 10% more cars and 12% more engines in 2011 than in 2010. The plant built more than 252,000 cars and 359,000 engines during the year. An additional 900 employees were also recruited to enable a third production shift from January 2012. The site now employs over 3,900 people. Kia invested €200 million in the engine shop to help boost maximum capacity to 450,000 units per year. A further €110 million is scheduled for investment in the plant in 2012, with new Cee’d production coming on stream. The arrival of the new model is expected to lift total vehicle production to 285,000 units this year. The Zilina plant produced over 101,000 Sportage models in 2011, accounting for 40% of total production and 103,000 Cee’d models, representing 41% of production. Venga production began in October 2011, generating 11,000 units and representing some 4% of production. The remainder was made up with Hyundai ix35 production until June 2011, before production was transferred to the Hyundai plant at Nosovice in the Czech Republic. Kia also invested €400,000 in the Zilina community during the year. Around half was allocated to environmental projects, while the other half was spent in community welfare, education and youth initiatives in the region.

IFW May 2012

From 109 g/km CO²*– the most efficient E-Class of all time. The E 300 BlueTEC HYBRID.

A Daimler Brand

At 4.2 litres of diesel per 100 kilometres, the new hybrid offensive from Mercedes-Benz – the E 300 BlueTEC HYBRID – is setting the benchmark when it comes to fuel consumption in the luxury business class vehicle segment. The modular hybrid concept with lithium-ion battery sets new record values in terms of efficiency with economical and comfort-enhancing innovations like the ECO start/stop function. Furthermore, it wins people over with its impressive driving experience and exemplary fuel consumption figures. The new efficiency record holder is also available as an estate. Find out more at www.mercedes-benz.com/fleet

*Fuel consumption urban/extra-urban/combined: 4.3–4.2/4.3–4.2/4.3–4.2 l/100 km, combined CO emissions: 112–109 g/km. Figures do not relate to the specific emissions or fuel consumption of any individual vehicle, do not form part of any offer and are intended solely to aid comparison between different types of vehicle.

motor show review NEW YORK SHOW

New cars come out for New York Show A car that flies? Just one of the stars of the New York Show, with Japanese models staging a big return after the losses bought about by the Tsunami last year.

Acura RLX Concept Honda’s luxury brand revealed the RLX lagship sedan in concept form at the New York Show. The production model is due for launch in early 2013. The RLX bristles with technology, featuring the irst application of the Acura Sport Hybrid SH-AWD powertrain, combining a direct injection VTEC V6 petrol engine and three electric motors, driving through a seven-speed dual clutch transmission and delivering 375PS. It’s approximately the same length as the current RL with a two inch longer wheelbase and two inch shorter front overhang. The AWD system is based on that shown on the NSX concept at the Detroit show. Alternatively there will be a 314PS front drive all-wheel steered version.

Chevrolet Impala Re-establishing an icon was the theme at the launch of the 10th generation Impala, ahead of its launch in early 2013. But forget about ‘60s ins or ‘70s muscle cars, the 2011 Impala was the best-selling fullsize sedan in the US and the stylish four-door design could easily pass for a European. Three direct-injection petrol engines are on offer: a 307PS 3.6-litre V6, new 198PS 2.5-litre four and a 198PS 2.4-litre four with eAssist electric drive assistance to lower fuel consumption. The four-cylinder engines come with active noise cancellation systems. Then there is a range of standard and optional safety features, from adaptive cruise control, to collision mitigation braking.

Fisker Atlantic

Honda Crosstour Concept

Fisker continued its mission to establish itself as a luxury electric vehicle maker with the unveiling of its latest model, the Atlantic sedan, in design prototype form at the New York Show. Based on the extended range serial hybrid drivetrain from the Karma, the Audi A5-sized Atlantic uses a four-cylinder petrol engine to drive a generator, supplying power to the drive motor once battery power has been depleted. It’s aimed at young families, says Fisker, combining luxury with practicality. Rear-wheel-drive will be the standard package, with four-wheeldrive as an option.

Due to debut in Q4 2012, the Crosstour Concept shows a new design direction for Honda’s North American mid-size crossover model, adopting SUV-style design. A new six-speed automatic and Honda’s Variable Cylinder Management system will help to improve fuel consumption for V6-powered models, while Honda promises a host of new safety equipment for both four-cylinder and V6 models. Inside, equipment improvements include new trim, an eight-inch dashboard display, keyless ignition and steering wheel mounted paddle shifts for V6 models.

internationalfleetworld.com

Infiniti LE Concept

Hyundai Santa Fe Hyundai chose the New York Show to premier the new thirdgeneration Santa Fe, which will also make its debut in Europe later this year. “More masculine, more aggressive and a more characterful SUV appearance than its predecessor”, is how Hyundai describes the crossover model. There will be a new 203PS/145g/km, 2.2-litre diesel for Europe alongside the 152PS/155g/km 2.0-litre variant, plus a 196PS/197g/km 2.4-litre direct-injection petrol engine. Transmission choices will be six-speed manual and automatic.

Jaguar F Type Jaguar’s concept sports car made its debut at the Frankfurt Show last September, but Global Brand Director Adrian Hallmark used the New York Show to announce that the car will definitely be built, following positive reaction to the concept car. He promised that the production version will be unveiled this year. The opentop two seater will be built from aluminium and powered by a range of petrol engines, including a new engine family. Final on-road testing has now begun and the new car will be built in the UK. Sales are scheduled to begin in mid 2013.

In initi promised a production version of the LE concept within two years, as the latest EV thinking from the company was unveiled in New York. The battery electric drive system promises some new thinking, including a home-based wireless charging system embedded in the garage loor. “All you have to do is park your vehicle over the charging pad with no need to connect cables”, says In initi Americas Vice President Ben Poore. Batteries are located under the passenger compartment loor to maximise interior and luggage space. The car will even reserve charging station space using advanced connection features.

Nissan Altima On sale this June, with a starting price of $21,000 was Carlos Ghosn’s promise at the unveiling of the fifth generation Nissan Altima at the New York Show. Nissan is targeting highway fuel economy of 38mpg (US) for the new car from its four-cylinder 2.5-litre engine. Comfort is a big feature for the mid-size saloon, Nissan’s best-selling US car. NASA helped out with seat design, to provide a seat shape that offers continuous support from the pelvis to the chest, helping to reduce muscular and spinal loads and improve blood flow, with a view to cutting driver fatigue over long distances.

Terrafugia Transition If you see this on your fleet options list, don’t miss the opportunity. The Terrafugia Transition is designed to beat the traffic jams, by flying over them. In fact the Transition production prototype completed its first flight just a week before it made its motor show debut in New York. The two-seater is designed to fit inside a single garage with wings folded. It’s designed to cruise at 93 knots and return 35mpg (US) on road. The wings are automatically folded in and out using an electromechanical system. Power comes from a 101PS Rotax aero engine. There’s room for golf clubs in the cargo area.

IFW May 2012

fleet management

THE SUB-100 FLEET DREAM OR REALITY? Could you be running your fleet at an average of 100g/km of CO2, and so make savings without making compromises? Steve Moody and Alex Grant investigate. THE LOWEST OF THE LOW OUR PICK OF THE CLEANEST CARS IN THEIR SECTORS...

City car: Volkswagen up! Bluemotion (95g/km) The city car segment is petrol-dominated, with no shortage of sub-100g/km vehicles and a handful of battery electric models joining the market. However, for practicality and cost it’s the Volkswagen up! and its mechanically identical siblings from Škoda and SEAT that make the most sense for ﬂeets. In Bluemotion form, the up! emits 95g/km and is the most distinctive looking of the three. It falls into the second lowest insurance group and has a desirable badge which means strong residuals, while practicality will be boosted by the forthcoming ﬁve-door model.

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OTHER OPTIONS • • • • • • • • • • • • • •

Citroën C-Zero (0g/km) Citroën C1 (99g/km) Fiat 500 TwinAir (95g/km) Fiat Panda TwinAir (95g/km) Ford Ka (99g/km) Hyundai i10 Blue (99g/km) Mitsubishi i-MiEV (0g/km) Peugeot iOn (0g/km) Peugeot 107 (99g/km) Renault Twizy (0g/km) SEAT Mii Ecomotive (97g/km) Škoda Citigo (97g/km) Smart fortwo cdi (86g/km) Toyota iQ (99g/km)

If the vast majority of your cars are below the 100g/km figure, there are a number of environmental and financial benefits

There is now a plethora of cars with emissions figures of 100g/km or less, and the list grows longer seemingly every month as manufacturers find more ways of dipping cars below this magical mark. But the reality of sub-100g/km is that it’s not just hair-shirt motoring, wheezing about in tiny little city cars unfit for a working life. Increasingly every model range has a car with double digit CO2 figures, and even larger models are seeing efficiency specials somewhere around this mark. It might seem an arbitrary target, but if the vast majority of your cars are below the 100g/km figure, there are a number of environmental and financial benefits for fleets.

Supermini: Hyundai i20 Blue Drive 1.1 CRDi (85g/km) The majority of sub-100g/km cars in the supermini segment are diesel-powered, but innovative petrol cars such as the twocylinder TwinAir engine due for the Fiat Punto and Alfa Romeo MiTo, supercharged Micra DIG-S, lightweight Peugeot 208 and Yaris Hybrid are options for particulate concerned fleets. But while the Yaris leads the segment at 79g/km, Hyundai and Kia offer the lowest CO2 outputs of any conventionally powered car on sale, which brings prices down. The Rio emits 85g/km, while the newly facelifted i20 undercuts this at 84g/km but offers slightly more space, and a larger 1.4-litre diesel option at 96g/km.

OTHER OPTIONS • • • • • • • • • • • • • • • • • • • • • •

Alfa Romeo MTO 1.3 JTDm-2 85bhp (95g/km) Audi A1 1.6 TDI (99g/km) Chevrolet Aveo 1.3 VCDi (95-99g/km) Chrysler Ypsilon 1.3 M-Jet (99g/km) Chrysler Ypsilon 0.9 TwinAir SE auto (97g/km) Citroën C3 eHDI 70 Airdream EGS VTR+ (87g/km) Citroën DS3 1.6 HDi 90 Airdream (95-98g/km) Fiat Punto Evo TwinAir (98g/km) Ford Fiesta Econetic (87g/km) Kia Rio 1.1 CRDi EcoDynamics (85g/km) Kia Rio 1 Air (94g/km) 2 CRDi (99g/km) MINI One D and Cooper D (99g/km) Nissan Micra DIG-S (95g/km) Peugeot 208 1.4 e-HDi (87g/km) Renault Clio dCi 88 (94g/km) Renault ZOE (0g/km) SEAT Ibiza EcoMotive (92g/km) Skoda Fabia Greenline II (89g/km) Suzuki Alto (99g/km) Toyota Yaris Hybrid (79-85g/km) Opel Corsa 1.3 CDTi Ecoflex (94g/km) VW Polo Bluemotion (91g/km)

IFW May 2012

fleet management

Premium mid-size hatchback: Lexus CT 200h (98g/km) The premium sector is undergoing a refresh, with new sub-100g/km models from BMW and Audi alongside new Mercedes-Benz and Volvo models with broader appeal. But while this is a diesel-dominated market, Lexus’s compact hybrid has performed well, with over half of all sales going into this one model in its first year. It offers a power to almost match 2.0-litre diesel models, but with CO2 emissions lower than rivals’ most efficient 1.6-litre diesels, while the hybrid drivetrain offers tax advantages in some countries. The more aggressive-looking F-Sport version will add appeal, too. OTHER OPTIONS

Mid-size hatchback: Renault Megane dCi 110 Stop and Start (90g/km) The mid-size hatchback class is one of the most competitive on emissions, with most mainstream manufacturers oﬀering a sub-100g/km model. Conventionally powered vehicles are all diesel powered, while petrol options include two Toyota hybrids and GM’s innovative rangeextended electric cars. But while the C-Segment includes very capable pure electric cars, this is a sector where long-range cruising is a desirable feature and volumes are high enough to make ultra-low CO2 models an advantage for reducing range-wide emissions. Renault’s facelifted Mégane features a revised dCi 110 diesel with start/stop at 90g/km, with the option to buy estate and coupe versions alongside the hatch.

• • • • •

Audi A3 1.6 TDI 3dr (99g/km) BMW 116d EfficientDynamics (99g/km) Lexus CT 200h (98g/km) Volvo C30 DRIVe (99g/km) Volvo V40 DRIVe (94g/km)

OTHER OPTIONS • • • • • • • •

Chevrolet Volt (27g/km) Citroën C4 1.6 eHDI 110 EGS VTR+ (98g/km) Ford Focus Electric (0g/km) Honda Insight (96g/km) Honda Civic 1.6 diesel (95g/km) Hyundai i30 1.6 CRDi Blue Drive (97g/km) Kia Cee’d 1.6 CRDi EcoDynamics (97g/km) Nissan LEAF (0g/km)

CASE STUDIES

• • • • • • • •

Renault Fluence Z.E. (0g/km) SEAT Leon Ecomotive (99g/km) Toyota Auris Hybrid (89/93g/km) Toyota Prius (89/92g/km) Toyota Prius Plug-in (49g/km) Opel Astra ecoFlex (99g/km) Opel Ampera (27g/km) VW Golf Bluemotion (99g/km)

GOING UNDER THE TON: FLEETS WHO HAVE MADE THE LEAP...

E.ON

CAMPS INTERNATIONAL

Around 340 home energy advisors working for energy firm E.ON are driving Ford Fiesta 1.6-litre TDCi ECOnetics, which have CO2 emissions of 95g/km. Contract hired from Lex Autolease, the vehicles are expected to cover an average of 20,000 miles a year, including personal and business use. E.ON has recently changed its fleet car replacement period from three to four years. Nina Hughes, Fleet Development Manager, Business Services, says: ‘We have had good feedback from the drivers of our Ford Fiestas, and the lower CO2 emissions of the Fiesta ECOnetic will help us deliver on our lower emissions policy as well as providing reduced fuel consumption. ‘As a company we have an overall fleet CO2 reduction target of 40% by the year 2020, having achieved reductions exceeding 10 per cent a year, since 2008. We are expecting these Ford cars to further help in achieving our goal.’

An award-winning ethical travel company, Camps International has added a dozen SEAT Ecomotive models, with emissions of 99g/km or less, to its UK vehicle fleet. Camps International offers a range of gap year volunteering experiences and school expeditions at locations across East Africa, South East Asia and Latin America. The 11 Leon E Ecomotive models and one Ibiza E Ecomotive will be used by the Hampshire-based company’s UK sales team as they travel to schools and colleges liaising with young people and organisations interested in all manner of life-changing travel options. Camps International says the SEATs have helped it to slash its fuel costs while members of the sales team have also made significant tax savings.

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COMMENT Is the 100g/km fleet a reality – or will it be soon? Nigel Underdown, Head Of Transport Advice, Energy Saving Trust

Upper-medium car: Peugeot 508 (99-109g/km) Downsized efficient diesel engines have brought a rapid decline in the average CO2 emissions of the D-Segment, with many of the mainstream manufacturers offering sub120g/km models. It means long-distance cruisers don’t have to affect average emissions too heavily. The lowest emission vehicles in the segment are the 109g/km Volkswagen Passat Bluemotion and Peugeot 508 e-HDI micro-hybrid. But it’s the Germanic new 508 which offers the broader spectrum of low-CO2 models, with the diesel-electric HYbrid4 powertrain returning 95g/km in the saloon due this summer, or 107g/km for the cheaper e-HDI with its electronically controlled manual gearbox. OTHER OPTIONS • • • • • • •

Ford Mondeo 1.6 TDCi Eco (114g/km) Hyundai i40 1.7 CRDi Blue Drive (113g/km) Peugeot 508 e-HDI (109g/km) HYbrid4 (95g/km) Škoda Superb Greenline II (119g/km) Toyota Avensis WHICH ONE (119g/km) Opel Insignia 2.0 CDTi ecoFLEX (116g/km) Volkswagen Passat Bluemotion (109g/km)

Premium family car: BMW 320d ED (109g/km) In the outgoing 3 Series, the 320d EfficientDynamics has helped make BMW almost the default option for the corporate sector, proving that matching the best-in-segment mainstream models didn’t have to mean sacrificing performance, luxury or an upmarket badge. The new 320d EfficientDynamics raises the bar further, cutting emissions to 109g/km and offering the automatic gearbox 40% of buyers of the old model said they wanted, without an uplift in CO2. Low tax has made this an attainable model for plenty of fleets who had never considered BMW before, the carmaker has said. OTHER OPTIONS • • • • • •

Audi A4 2.0 TDIe 136PS (112g/km) Citroën DS5 Hybrid4 (99-107g/km) Mercedes C220CDI BlueEfficiency (117g/km) Peugeot 508 RXH (107g/km) Volvo S60 D2, D3 or D4 (114g/km) Volvo V60 PHEV (49g/km)

Of course it’s possible to achieve a fleet average of 100g/km of CO2 now. At the latest count there are 180 vehicles of less than 100g you can order today. Sprinkle in a few EVs at zero (okay, ignoring the upstream emissions) and that should leave some slack for the odd MPV and still allow you to achieve an average of 100g or less. But is it a sensible ambition for the average fleet manager? No – at least, not as an aspiration in isolation from other key considerations. Sure there is an impressive crop of 99g/km and lower cars which many income-squeezed drivers are increasingly drawn to. They’re finding that lower tax and cheaper private motoring don’t come with that many restrictions in terms of creature comforts and performance. But steering drivers towards more efficient vehicles needs to take account of more than just the tax bill and that’s why measuring success simply on the quoted combined CO2 has its pitfalls. Firstly, many of the advances in vehicle technology impact most in urban driving. That stop-start system which helped to score a magic 99g/km on the combinedcycle will do little for your national sales manager driving long distances on the motorways. Similarly, the smallengined hybrid cruising at 110kph will perform much less well than a bigger diesel. Most of us know that in real life motoring the official mpg is very hard to achieve but research in the Netherlands has concluded that the variance between combined and real life mpg increases as vehicle CO2 decreases. Choosing a car that’s fit for purpose is more likely to do what it says on the label in terms of CO2 than a low carbon car that’s put to work on the wrong job. It’s understandable that CO2 is front-of-mind in many fleet decisions but, tax issues apart, what really matters is how much fuel is burnt and how many miles are driven and at what overall running cost. Tackle driver behaviour in terms of driving style and unnecessary mileage and that will deliver much bigger fuel savings than focusing purely on achieving a 100g/km average. But back to the question - will we see the 100g fleet? For certain types of fleet, I think it’s almost a reality now. And, yes I think we will and the reason I’m optimistic is because average new car CO2 emissions are heading inexorably downwards and will continue to do so as European regulations tighten. But my advice would be don’t pursue the 100g/km target too single-mindedly. It’s horses-for-courses; electric vehicles for mainly urban use, hybrids for mixed operations while not ruling out the trusty low carbon diesel for your motorway cruisers.

¡ IFW May 2012

fleet management

MPV: Toyota Prius+ (96-101g/km) Sub-120g/km MPVs, with five and seven seats, are beginning to enter the market. Renault’s Grand Scenic leads the segment’s conventionally-powered models with the 105g/km dCi 110 diesel launching with the 2012 facelift. But it’s Toyota which will push the segment forward the most this year with the Prius+. Part of the carmaker’s expanding hybrid family, it’s the first time a seven-seat car will be offered with emissions of under 100g/km, meaning MPV practicality no longer has to add thirsty vehicles to the fleet. OTHER OPTIONS • • • • •

Ford C-Max 1.6 TDCi (119g/km) Renault Grand Scenic dCi 110 (105g/km) SEAT Altea XL Ecomotive (119g/km) Vauxhall Meriva 1.3 CDTi Ecoflex (119g/km) Vauxhall Zafira Tourer ES 2.0 CDTi (119g/km)

Crossover/small SUV: Mazda CX-5 (119g/km) Even the traditional “gas guzzler” SUV segment is no longer a drain on the average CO2 figure, with crossovers now offering car-like fuel economy in two-wheel drive form and Peugeot’s 3008 HYbrid4 offering the only four wheel drive option under 120g/km. The most innovative here, though, is the forthcoming Mazda CX-5. Featuring the new Skyactiv Technology package, the body and chassis structure are engineered to be as light as possible, while the manual gearbox and 2.2-litre diesel engine return 119g/km and Euro 6 compliance without exhaust after-treatment – unique in this segment. OTHER OPTIONS • • • •

BMW X1 sDrive20d EfficientDynamics (119g/km) Nissan Qashqai 1.6 dCi Start/Stop (119g/km) Peugeot 3008 HYbrid4 (99-104g/km) Škoda Yeti Greenline (119g/km)

HOW LOW CAN YOU GO? THE SUB-50G/KM FLEET Electromobility has introduced the possibility to cut CO2 emissions still further, with a handful of models now coming in under 50g/km. But is it possible to construct a fleet from the lowest emitting vehicles? CITY CARS Traditionally a bread and butter segment for electric cars, the city car segment has near mechanically identical battery-electric offerings from Mitsubishi, Citroën and Peugeot. Renault’s futuristic Twizy twoseater and an updated Smart ForTwo ED are now available too. SUPERMINIS A production version of the battery-electric Renault ZOE will launch this summer, and is designed from the ground up to run on electricity. It offers a 130-mile range and 80bhp electric motor, while the carmaker’s battery leasing scheme is claimed to result in equivalent pricing to a conventional diesel car. LOWER MEDIUM Nissan’s award-winning LEAF has proved electric cars don’t have to be small, and will be joined by the electric Renault Fluence and Ford Focus within 12 months. Those seeking long-distance cruising ability will get the option of the 27g/km Opel Ampera and Chevrolet Volt, which offer a 50-mile range and petrol engine to top up battery power. Toyota’s Plug-in Prius also falls just under the 50g/km target. UPPER MEDIUM The Volvo V60 Plug-in Hybrid offers a unique proposition in the upper medium segment, combining power and luxury with 49g/km CO2 emissions and 148mpg fuel economy thanks to its 50km electric range. But that technology doesn’t come cheap.

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EV news analysis

Fleet Forum members begin LEAF trial Nissan has partnered with the Fleet Forum to launch an Electric Vehicle Demonstrator Programme, which will provide five LEAF electric vehicles, free of charge, to five of the forum's organisational members for a 12-month trial. Founded in 2003, the Fleet Forum has 50 members, including five international aid organisations, and is aimed at improving the safety, cost-efficiency and environmental impact of transport for charitable organisations. The knowledge centre is managed by the Red Cross and Red Crescent Societies, the UN World Food Programme, World Vision International, Care and TNT. Nissan handed over the first vehicles, which will be used in Switzerland, last week. Once the trial is complete, Nissan and Fleet Forum will share information about how the cars perform in real-world use. Paul Jansen, executive director of Fleet Forum, explained: ”This is an excellent example of learning through demonstration. Through this programme these different organisations can see for themselves how electric vehicles can be used to help achieve their objectives. From a Fleet Forum point-of-view we're happy to facilitate this as a way of increasing efficiency and reducing pollution.”

Twizy joins Orange Group fleet in France

Telecoms giant Orange has become the first business customer for the Renault Twizy, announcing it will add 100 of the electric quadricycles to its fleet during 2012 as part of ongoing plans to reduce CO2 emissions and energy usage. The vehicles, which are on a long-term lease through Arval, will be provided to employees on a loan basis for urban business use, with the first 14 examples already deployed in and around Paris. In addition to the remainder due by the end of the year, the group’s fleet management director, Jean Zermati, said Twizy could be added to fleets in other countries depending on suitable duty cycles and a supporting service infrastructure. Orange has 35,000 vehicles on its global fleet, with 23,000 of those based in France, and said 5% of its energy consumption and 15% of its greenhouse gas emissions are from vehicles and business travel. As a result of promoting eco-friendly vehicle choices, average CO2 emissions are 130g/km groupwide, and 126g/km for its French fleet. Twizy joins a number of plug-in vehicles already deployed on the group’s French fleet, including the Renault Kangoo Z.E., Renault Fluence Z.E., a Peugeot iOn and Toyota Prius Plugin. By the end of 2013, Orange is aiming to have ”several hundred” electric or hybrid vehicles in use globally, contributing to a planned 20% reduction in CO2 emissions and 15% reduction in energy consumption by 2020, compared to 2006 levels.

Report maps EV CO2 output across United States Despite large variations in the CO 2 emissions from energy generation between states, electric vehicles are an effective way for American drivers to cut their carbon footprint and save money, according to a recent study. The California-based Union of Concerned Scientists analysed CO 2 emissions for charging electric vehicles and compared them to using a hybrid or conventional petrol-powered alternative. Their report divided the country into ‘Good’, ‘Better’ and ‘Best’ regions, depending on the carbon intensity of the grid electricity. This showed 45% of Americans live in the ‘Best’ regions, where CO2 emissions from an electric vehicle are equivalent to a 50mpg (4.7l/100km) petrol alternative and 46% better than the U.S. average of 27mpg (8.7l/100km).

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Strong hybrid markets, such as New York and California, performed even better, with CO2 output equivalent to an 80mpg (2.94l/100km) petrol vehicle, while Alaska was the most energyefficient region to use an EV at equivalent to 112mpg (2.1l/100km). Even the 18% living in ‘Good’ areas would see an average of between 31-40mpg (7.6-5.9l/100km), with drivers in the highest-emitting region, the Rocky Mountains, matching the CO2 output of a 33mpg (7.2l/100km) car. The report also pointed out that while coal accounts for 45% of energy generation at the moment, 29 states and the District of Columbia are in the process of retiring coal powered plants for renewable alternatives. Drivers can also expect to save between $750 and $1,200 (€575-921) compared to an average American petrol car, according to its results.

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GM finds Chinese partner for Volt launch General Motors China has signed a memorandum of understanding with the China Automotive Technology and Research Centre (CATARC) to manage the carmaker’s Chevrolet Volt demonstration fleet in Beijing for one year, including organising workshops with decision-makers and key stakeholders to encourage EV take-up in the country. China's first Volt demonstrator vehicles will be delivered in April, with the two companies forming a joint working team to collect feedback from their usage to inform vehicle policy in the country. Real-world performance, charging and infrastructure will all be examined as part of the demonstration process. Ray Bierzynski, GM China executive director of electrification strategy, said: ”It is important for us to offer those in key positions to affect policy an opportunity to experience firsthand our variety of electrification solutions for reducing the automotive industry’s dependence on petroleum.”

University develops tool to predict grid demand Experts at Northumbria University and the North East England’s Plugged-in Places scheme, ‘Charge Your Car’ have partnered to develop a tool to help predict and inform policy-makers of the effect of electric vehicle demand on the National Grid. The ‘Grid Capacity Calculator’ uses existing energy consumption figures and calculates the addition grid demand from having electric vehicles plugged in to charge. Although it was designed around the North East of England, the tool can be applied across any region of the UK and is being adapted to include additional features to allow it to analyse smart charging systems, which adjust charging times around peak demand and can feed energy back to the grid. Project leader, Dr Ghanim Putrus explained: ”Any electricity usage scenario can be tested using this tool, giving a picture of what can happen to existing grid infrastructure and helping to plan future power networks or smart grids.”

Tesla opens first Norwegian dealer Electric vehicle manufacturer Tesla Motors has announced it will open a showroom and service centre in Oslo, similar to its facilities in London, Eindhoven in the Netherlands and California, ahead of two significant model launches in Europe. Launched later this year, the carmaker’s Model S electric luxury saloon has already received an order of 150 vehicles through Athlon Car Lease, marking its first fleet order. The Model X electric SUV, with four-wheel drive, will follow during 2013.

in brief... Ford opens electric and hybrid R&D centre Ford will convert its 26,477m2 Advanced Engineering Centre in Dearborn, Michigan to work exclusively on hybrid and electric vehicles. The facility will be home to 1,000 engineers, and is part of a programme that will add 12,000 US jobs by 2015 to work on the new technology.

EV recharging network established in Northern Ireland A network of 40 electric vehicle charging points is now live in Northern Ireland, with an additional 100 due in the next year. The units are being funded by a €1,033,183 grant from the Office for Low Emission Vehicles, and will include rapid chargers capable of charging to 80% capacity in 25 minutes.

Solar-powered hydrogen fuelling station opens in Japan Honda has partnered with Saitama Prefecture and Japanese industrial group Iwatani to open Japan’s first solar-powered hydrogen refuelling station. It uses a high-pressure water electrolysis system instead of a mechanical compressor and produces 1.5kg of hydrogen per 24 hours – enough to cover 145km in the FCX Clarity fuel cell vehicle – with no CO2 emissions from production, storage or dispensing.

Fast charger cuts costs for fleets Swiss-Swedish technology group ABB has developed a low-cost fast charging unit for Europe, aimed at improving the business case for electric vehicles. Priced from €9,988, around half a conventional unit, it can fully charge most EV batteries in 30-120 minutes and doesn’t require an upgraded grid connection.

IFW May 2012

fleet strategy

Portuguese leasing sector suffers low confidence and rising costs Forecasted residual values have fallen by -3.2% in Portugal over the last twelve months at a time when confidence in other European nations continues to grow. According to the latest experteye European Leasing Index, the UK and Germany have reported a +5.2% rise in their residual value forecasts, Spain a +4.4% increase, France +3.8% and Italy +2.3%, leaving Portugal as the only nation to show a drop. The experteye survey, which tracks forecasted residual values (RV), servicing, maintenance and repair (SMR) costs and rental rates in six European countries, uses data supplied by major leasing companies. With a +7.5% hike in SMR budgets over the course of the year, Portugal’s costs are rising faster than the other nations surveyed. Italy (+6.8%) and the UK (+6.6%) are close behind, with France showing a more nominal rise in budgets of +2.8%. In Spain there has been no movement and in Germany a -0.7% reduction. Yet Portuguese fleet operators have not been dramatically affected by the slide in RVs and rise in SMRs, with rental rates only rising by +0.6% whilst German customers enjoy the largest reduction with a -3.5% drop since April 2011.

MARKET SUMMARIES – 3 and 12 months to March 2012 FRANCE: French customers have seen a -3.1% reduction in their rental rates in the last three months, the largest drop of all nations surveyed. Over the same period SMR budgets have fallen by -2.1% and forecasted residual values are up by +0.6%. For the twelve months from April 2011 to March 2012, French forecasted residual values have improved by +3.8%, SMR rates have risen overall by +2.8% and rentals have come down by a fractional -0.7%. GERMANY: Over the last twelve months Germany has the same shared optimism in the future used vehicle market as the UK, with both countries reporting a +5.2% rise – the highest of all nations in the experteye survey. German fleet customers have also enjoyed the largest reduction in SMR costs during the year with a -0.7% drop and the greatest fall in rental rates at -3.5%. In the three months from January 2012 to March 2012, rental

rates continue to fall (-1.2%) with RVs moving upwards by +0.9% and SMR budgets reducing by the same (-0.9%). ITALY: Annual servicing, maintenance and repair budgets have risen by the second highest amount in Italy, with a +6.8% rise, just behind Portugal at +7.5%. Forecasted RVs have risen by +2.3% and rental rates have dropped by a negligible -0.7%. In the last quarter, rental rates have risen slightly (+0.7%) with a calming of the SMR increases (+1.6%) and residual values falling by -0.3%. PORTUGAL: Portugal is the only nation to report a downturn in its forecasted residual values during the past twelve months with a -3.2% reduction. In the last quarter since January 2012, this trend continues with a -2.1% fall showing a continued lack of con idence in the future used vehicle market. Portugal tops the table for rising SMR costs with a +7.5% rise in budgets since April 2011, steadying to +1.6% in the last three months. Perhaps surprisingly, rental rates only increased by +0.6% during the year, and +1.6% in the last quarter. SPAIN: During the last quarter, Spain has reported the largest increase in SMR costs with a +3.5% rise in budgets. During the same period residual value forecasts have moved marginally with a +1.0% increase and rental rates have dropped by -0.9%. The rise in SMR is a shift from a twelve month period that showed zero movement in budgeted costs, whilst RVs rose by +4.4% and rental rates by +0.1%. UK: With a +5.2% rise in forecasted residual values, the UK tops the annual league table alongside Germany for its confidence in the future used vehicle market, continuing with a +4.9% rise in RVs in the last quarter. This follows a temporary dip in confidence in the last European Leasing survey when the UK saw a drop of -1.7% in the quarter from December 2011 to February 2012. SMR budgets have been rising, with the UK reporting a +6.6% increase for the year and a +2.7% rise for the quarter, and rental rates have remained relatively steady with a -1.0% reduction from April 2011 and a -0.3% fall from January 2012.

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

France Germany Italy Portugal Spain UK

Current Rental Rates

3-month change 12-month change 3-month change 12-month change 3-month change 12-month change +0.6% +3.8% -2.1% +2.8% -3.1% -0.7% +0.9% +5.2% -0.9% -0.7% -1.2% -3.5% -0.3% +2.3% +1.6% +6.8% +0.7% -0.7% -2.1% -3.2% +1.6% +7.5% +1.6% +0.6% +1.0% +4.4% +3.5% +0.0% -0.9% +0.1% +4.9% +5.2% +2.7% +6.6% -0.3% -1.0%

Notes: • The comparisons are for vehicles with a contract duration of 36 months/90,000km. • Twelve-month comparisons show change since April 2011. • Three-month comparisons show change since January 2012.

Forecast Service, Maintenance and Repair Costs

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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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interview

WHEELS IN

4MOTION

A wide-ranging attack is being mounted on the global 4x4 light commercial market by Volkswagen Commercial Vehicles says head of product marketing, Christian Wattenberg: and the attack does not solely involve the increasinglysuccessful Amarok pick-up.

While they may not need to venture off road, they need enough traction to keep going on slippery highways when they are fully-laden 24

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With all-wheel-drive 4Motion versions of Caddy and Transporter and a newly introduced 4Motion Crafter off-roader in its portfolio too, the company has the bulk of the sector covered, he contends. “We’re the only manufacturer to offer such a broad range and I think that gives us a distinct advantage,” he said. Nor are its 4x4s being sold in small numbers. “If you throw in leisure models such as the Caddy Maxi 4Motion Tramper mobile home, then annual sales total around 90,000 units and we’re sure volumes will increase,” Mr. Wattenberg stated. To set that igure in context, the company delivered almost 529,000 Caddies, Caddy Maxis, Transporters, Crafters and Amaroks of all types worldwide last year. That was a rise of 21.4% on 2010’s performance (436,000 units), with the sharpest sales increases witnessed in South America, Central and Eastern Europe and the AsiaPaci ic region. Operating pro it rose from €217m to €449m. Volkswagen has recognised that there is a high level of corporate demand for 4x4 light commercials. A large percentage of sales are made to leet operators in countries that experience heavy snowfalls at certain times of the year and have a lot of hilly terrain. “While they may not need to venture off road, they need enough traction to keep going on slippery highways when they are fully-laden,” Mr. Wattenberg said. That is because they offer services – everything from postal deliveries to emergency medical care – that have to be delivered in almost all weather conditions. The Swiss Post Of ice is a prime example of the sort of customer Mr. Wattenberg means. In 2010 it acquired over 500 4Motion Caddies. “Switzerland is in fact our ifth-biggest market for 4Motion Caddy,” he said. “The biggest of the lot is Germany, with Norway, Austria and Sweden in second, third and fourth place respectively.” Germany is the largest market for 4Motion Transporter too, followed by Austria, Norway, Sweden and Switzerland in descending order. “The UK is in tenth place,” he remarked. The ability to offer so many 4x4 models opens doors for VW when it comes to approaching leets, the bulk of whose requirement is 4x2 but with some allwheel-drive capability. Once through those doors VW can talk to the company concerned about satisfying all its light commercial needs.

“Do our 4x4 vans and pick-ups represent a useful sales tool? Of course they do,” said Mr. Wattenberg. Despite its vast in-house resources, VW is not afraid to enlist the help of third party specialists when it comes to 4x4 vehicle development. The new Crafter 4Motion has been devised by Austrian engineering group Achleitner. Starting out in the early 1930s as a blacksmith’s shop, and still family owned, it has its headquarters at Wörgl and a factory in Radfeld, both in the Tyrol. Aside from 4x4 models, it produces everything from military vehicles and security vans to trailers for the Red Bull Formula 1 team. Aimed at customers who regularly need to drive off-highway into rough terrain – utilities, construction companies, government departments such as the Republic of Ireland’s Environmental Protection Agency for example – the 4x4 Crafter is produced solely with the 163hp version of VW’s widely-used 2.0-litre diesel. Power is split permanently 50/50 between the front and back axles with an electric differential lock standard on the centre transfer box and a pneumatic differential lock mounted on the back axle. “Not only can it take you off the beaten track, it can take you to places where there is no track at all,” said Mr. Wattenberg. An air tank and a compressor providing up to 8 bar of pressure have been installed and a pneumatic differential lock can be itted to the front axle as an option. Lefthand-drive models are already in production and VW and Achleitner are hoping to start building right-hand-drive versions to satisfy demand in markets such as the UK, South Africa and Australia. “Potential customers in Australia include mining companies and tourism irms running excursions into the outback,” said Achleitner 4x4 sales specialist, Andreas Reich. Higher ground clearance means that at 770mm, 4Motion Crafter van’s rear loading height is 100mm greater than the 670mm offered by the standard model. A drawback however is the cost – you pay a premium of almost €20,000 – not to mention the 3.5-tonner’s restricted payload capacity of approximately 1,000kg, although a 5.0-tonne gross 4Motion Crafter can be specified by those who need to carry more weight. The pretty-much-all-terrain Crafter is sold in dropside and nine-seater window van variants as well as with a van body and

with short (3,250mm), medium (3,665mm) and long (4,325mm) wheelbases. It can be ordered as either a single-cab or a doublecab chassis too. Equally eager to establish its credentials in the rough is the Rockton version of the 4Motion Transporter, which has more ground clearance than the ordinary 4Motion: 254mm compared with 201mm. One rung up from the Rockton is the Rockton Expedition, with 16ins all-terrain tyres on strengthened steel wheels and increased traction when the gearbox is switched to off-road mode. An optional protection pack contains under-body guards for the engine, gearbox, fuel tank, sills, rear diff and main silencer. One rung up from that is the 4Motion Transporter based Multivan PanAmericana, with 17-inch wheels, a mechanical rear differential lock and reinforced springs and shock absorbers. Anxious to tailor 4Motion Transporter to bespoke leet needs, Volkswagen can equip the dropside model with a roll bar mounted behind the cab and a 0.7kW cable winch fed by a second battery. Mounted on the cargo bed, it has a pulling power of 1,360kg. While Amarok is at present sold solely with the aforementioned 2.0-litre diesel, Mr. Wattenberg would not rule out the possibility of a bigger engine being introduced to satisfy the aspirations of certain markets, including South Africa. In the meantime, a 180hp 2.0-litre Amarok double cab has been introduced with an eight-speed automatic gearbox offering a greater spread of transmission ratios than a conventional automatic transmission. A two-door single cab has joined the fourdoor double-cab line-up too. With an eye to the desire of leet customers to cut their carbon footprint, Wattenberg points out that the automatic Amarok comes with Stop/Start and Blue Motion Technology. As a consequence the CO2 emission igure is an, in context modest, 199g/km. The automatic is offered only on doublecabs with permanent rather than selectable four-wheel-drive. Key production countries for VW’s 4x4 light commercial line-up are Germany, Poland and Argentina. Production of righthand-drive Amaroks is however being shifted from Argentina to VW’s Hanover, Germany factory at the end of June to provide much-needed extra capacity to meet demand: Amarok takes the lion’s share of VW’s international 4x4 light commercial sales.

IFW May 2012

fleet focus SPAIN Ibiza is Spainâ&#x20AC;&#x2122;s best-selling car, but SEAT is the 10th most popular brand for business customers, according to JATO.

Economy poor, business good? Spain's economy might be struggling, but the motor industry plays a vital part in manufacturing and business. Does the future look bright?

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The Spanish economy is rarely out of the headlines in the European business press at the moment as the country struggles with its long-running ﬁnancial crisis. Spanish banks are reported to have practically doubled their borrowing from the European Central Bank in March, compared with February, triggering new fears that the country could default on its debts. Overall the economic outlet is not bright. The economy is expected to contract by 1.7% this year and unemployment stands at nearly 23%, the highest in the European Union, with almost 4.75 million people out of work. The average rate for the Euro zone stands at 10.3%. Forecasts suggest that unemployment will rise further still to 24.3%. It is young Spaniards who have been hardest hit, with over 50% of 16-24 year olds out of work. It was banks that played a major part in the formation of SEAT, originally a government-backed motor manufacturer established during the rule of the Franco regime in 1950, which initially entered a partnership with Fiat – effectively building a succession of Fiat models, badged as SEAT – continuing until the early 1980s. After Fiat withdrew, VW became a partner in its place and now the company is a wholly owned VW Group subsidiary. SEAT is now one of a number of brands producing motor vehicles in Spain. According to the European Automotive Manufacturers’ Association ACEA, the automotive industry accounts for 7% of Spanish industrial employment, 5% of gross domestic product and 26% of the nation’s exports. ACEA also credits Spain as the third largest passenger car manufacturing nation in the European Union, and the largest producer of large commercial vehicles. ACEA lists 15 plants in Spain producing motor vehicles and ANFAC, the Spanish Automobile Manufacturers Association lists 18 plants producing vehicles and components. All major European manufacturers make vehicles in Spain. Ford builds engines and models such as the Fiesta, Focus and C-MAX at Valencia. Nissan builds cars and light CVs in Barcelona including 4x4 pickup trucks, light trucks and vans, under the joint venture between Renault/Nissan and GM

The mighty Martorell is SEAT’s home production base. Europe, although production of the new Trafic, due late 2013, will move to France. Irizar produces buses in Ormaiztegi. VW produces engines and the Polo in Pamplona, while Martorell is home to SEAT car and engine production, as well as building the Audi Q3. Santana produces 4x4 vehicles in Linares including models for Suzuki and the Massif for Iveco, which can trace its origins back to licensed Land Rover production from the 1950s to the 1980s. Daimler produces light CVs in Madrid and Vito – the source of the Mercedes-Benz Vito medium van. Fiat produces Iveco heavy trucks in Madrid and Daily vans and light trucks in Valladolid. PSA Peugeot Citroen builds 207 and C3 models in Madrid and C4 Picasso models in Vigo, as well as the Citroen Berlingo and Peugeot Partner vans also in Vigo. Renault builds the Megane, engines and the new Twizy electric vehicle in Palencia and Valladolid. Last but not least, GM builds cars and light CVs in Zaragoza, with the Corsa, Meriva and Combo produced here. According to ANFAC data, vehicle production increased in Spain by 10% during 2010 to 2,387,900 units, but that was still less than in 2007, when the country produced 2,889,703 vehicles. 80% of production in 2010 was of cars, 16.7% of vans and light CVs, while trucks accounted for 1.5%, reflecting the large decline in the truck market that set in with the 2008 financial crisis. Not surprisingly, given the scale of production in Spain, vehicle exports are an important business. ANFAC data shows

that car exports rose 6.6% in 2010 to 1,658,341 and total light commercial vehicle exports reached 359,438. Truck exports rose 31.1% to 26,771. Overall, according to ANFAC, vehicle and component exports accounted for 18.3% of Spanish goods exported in 2010. There’s little doubt that the economic crisis is taking a bite out of the Spanish car market too. In 2011, new car registrations dropped 17.7% compared with 2010 to 808,059. Only Portugal posted a larger percentage fall. Compare that with the 2007 pre-crisis figure of 1,614,835 and it shows that new car registrations have halved in four years, having fallen below 1,000,000 in 2009 and continued downwards since. ANFAC figures point to an ageing car park in Spain. In 2010, 36.5% of cars were over 10 years old, a trend that could increase in the current economic climate. The picture was slightly better for commercial vehicles, with total new commercial vehicle registrations down 6.6% to 123,353 in 2011. Light CVs fell 10.1% to 104,372, having risen by 9% in 2010. Medium and heavy commercial vehicle registrations rose by 19.9% in 2011 to 16,302, some way below the EU average growth of 29%, but at least positive. We don’t have data for the Spanish rental market in 2011, but ANFAC data shows strong growth for the sector in 2010, with the number of rental cars growing 69% during the year, but that is against a background of a 56% decline in 2009.

How is the economy affecting the business market? To find out, we asked a number of experts for their view of the market. “The current economic environment has affected the sector in terms of fleet size”, a spokesperson for Leaseplan told IFW. “According to the information provided by the Spanish Vehicle Fleet Association (AER – Asociación Española de Renting), in 2011 there has been a contraction of 3.71% compared to 2010, and an average fleet reduction of 4.2%. Anyway, the vehicle fleet sector has withstood the crisis better than others,

IFW May 2012

fleet focus SPAIN

Economy poor, business good? TOP SELLING MODELS IN SPAIN Model

Q1 2011

Q1 2012

Change %

Seat Ibiza

8,031

8,104

+0.90

Ford Fiesta

5,743

5,108

-11.0

Nissan Qashqai

6,928

6,900

+0.40

VW Polo

5,137

5,428

+5.7

Renault Megane

5,752

5,356

-6.9

VW Golf

5,527

5,405

-2.2

Opel Corsa

5,094

5,190

+1.9

Peugeot 207

5,106

5,338

+4.5

Citroen C3

3,092

3,690

+19.3

Citroen C4

3,909

5,264

+34.7

* Source: JATO

TOP SELLING BUSINESS CARS IN SPAIN Model

Ranking

Model

Renault

Renault Megane

Peugeot

Peugeot 308

Volkswagen

VW Passat

Citroen

Renault Clio

Opel

Opel Insignia

Ford

Nissan Qashqai

Fiat

VW Golf

Audi

Peugeot 207

Mercedes-Benz

Renault Kangoo

Seat

Citroen Berlingo

* Source: JATO

demonstrating that it is still the best option in the market to manage the mobility of the companies. Carlos Garcia, JATO Dynamics' Country Sales Manager for Spain & Canary Islands, agrees broadly with this, "The current economic downturn in Spain has resulted in a trend of decreasing absolute values when comparing YTD 2012 and YTD 2011, with less new fleet registrations and extensions replacing deadlines. "However, there are increasing values in relative terms versus retail vehicles, although there is a general reduction of the number of ﬂeet vehicles in many companies. Companies are now commonly re-negotiating agreements with vehicle providers," Carlos said.

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And there’s a similar view from ALD Automotive’s Sonsoles Martin-Garea, “The current situation is still very delicate in a market deeply affected by the economic situation but we believe that by the end of this year we could start to see signs of recovery. The leasing companies have made enormous efforts in readjustment of business to adapt to difficult market conditions. However, during all this time we can say that renting has remained one of the main drivers of the car market in Spain.” He suggests that the average vehicle contract length in Spain is now 45 months, while Carlos Garcia at JATO reckons that it has reached 46 months in Q1 2012. As for trends in the fleet and leasing sector, Leaseplan sees several developments, “Obviously, the employment regu-

lations experienced during the last years have brought a decreasing fleet size. In addition, contracts have been extended due to companies seeking cost reductions through the extension of existing contracts. Anyway, the number of customers has not decreased because some markets (small and medium business, particular market, etc.) are starting to demand our services to manage their fleet or vehicles. Even so, the market in Spain is not so mature as in other European countries, so we think there’s still a long way to go.” Carlos Garcia at JATO sees a greater demand for outsourcing fleet management as well as a trend in low emission vehicles, "The increasing demand of low CO2 emission vehicles is significantly about saving on fuel costs and reducing all inherent costs such as taxes, after sales maintenance, insurance etc, in addition to being more eco-conscious. "YTD 2012 electric vehicle (EV) registrations in Spain have increased by 107% due to increased model ranges and a better understanding of the benefits of EVs," he said. "But there are still challenges to further the success and mainstream adoption of EVs in fleets which includes price acquisition, increased range, increasing the number of charging sites, a more extensive model range, improvement of technical data and more knowledge and experience around the accuracy of residual values and potential technical issues. “There is also a greater demand now for smaller engines and alternative fuel options that can deliver lower fuel consumption, lower emissions and higher efficiency”, he concludes. Sonsoles Martin-Garea at ALD also sees trends in vehicle size affecting many fleets, “We know that for some companies the car is an essential tool for their employees, therefore, they decided to cut costs rather than eliminate them. This indicates that many managers, who were used to highlevel models, now get more economic ones. Speaking in economic terms, a downgrade in the models can mean a reduction in the range between €75 and €100 in the monthly fee to a company with 100 vehicles, on average a saving of around €120,000.” But he still sees demand for well-equipped models, with equipment such as Bluetooth, GPS navigation and ESP stability control still popular.

AUTOROLA PREDICTS HUGE RISE IN ONLINE BUSINESS CAR REMARKETING SALES Online car sales within the B2B sector in Europe will rise by over 250% over the next five years predicts Autorola, Europe’s largest online remarketing company. n 2011 the company offered over 220,000 cars through its online platforms across 17 European countries. In five years it estimates this will rise to half a million vehicles, with the UK likely to see the largest increase after Eastern Europe, Germany, Italy and the Benelux countries. Working in 17 European countries gives Autorola a pan European view, helping it to predict where the growth will be in the UK and Eastern Europe. Autorola’s CEO Peter Groftehauge has looked at the hopes of increasing market share in the Spanish market during 2012, despite some challenging economic situations in the country. Spain is forecast to return to recession in 2012. The IMF expects the Spanish economy to shrink by 1.7% this year. Unemployment has risen to around 23% and youth unemployment stood at 48.6% at the end of 2011. The worsening situation prompted the Spanish Government to launch an economic reform programme in February. The Spanish Government has promised a range of changes including new fiscal discipline, balancing the country’s budgets and structural reforms including consolidation of the financial sector and reform of the Spanish labour market. The reform programme promises €8.9bn cuts in public spending, wage freezes and subsidy cuts, €6bn in tax increases and moves to reduce tax evasion. Against this background, Autorola Spain is expecting new car sales to reach around 820,000, approximately the same size as the 2011 new car market. Although private purchases are expected to fall, this is expected to be offset by an increase in business sales. It’s easy to see why retail sales are expected to fall as individuals struggle to source finance in the middle of a recession and falling public confidence. However, the business side of the market is more positive with an increasing number of tourists visiting Spain and the subsequent demand for rental cars set to increase. Leasing companies are also changing their strategy by growing their market share with small to medium companies, rather than just concentrating on the large multinationals. Like many European countries, around 80% of new car registrations are diesel in Spain. That takes into account the rental market, which in some other European countries is more petrol based. Used car sales reached 1.6m in 2011 and this growth is expected to continue through private consumers not buying new cars, but increasing their demand for used cars. Increased used car supply will come from the rental companies and manufacturers who are on large scale buy-back deals. This will help feed the used market with a steady supply of small and medium size cars with smaller engines. This is just the sort of stock the Spanish public want to buy, which further adds to the stability of the used market and residual values in general. Cross border selling is also becoming more and more popular for vendors as they can offer their product online to many more buyers and most importantly there are no transport costs until the car is bought and then delivered. This channel to market becomes more and more important when the supply of used vehicles in a single country exceeds demand. One to watch further in the future, reckons Autorola.

IFW May 2012

operator profile Alphabet

Multi-tasking... For a top five player in the European fleet management industry, Alphabet is a relatively young company. Established in the UK as a subsidiary of BMW Group in 1997, it’s a name that has come increasingly to the fore in the fleet management industry, thanks to its acquisition of ING Car Lease from the Dutch banking giant last September. Now with 474,000 car contracts throughout Europe, its operations have expanded into 19 countries, via a mixture of organic and acquisitive growth. Tim Kendall spoke to Nancy Storp (left), Alphabet’s Head of Marketing and Business Development, to find out more. Alphabet is now a multi-marque fleet management company across Europe. How has it grown over the past 15 years? It’s been through a combination of organic growth in the early years and acquisitive expansion later. Between 1997 and 2006, we had a sustained phase of organic growth, founding our own subsidiaries rather than acquiring other businesses in order to expand our market share. After establishing Alphabet in the UK in 1997, we opened in Germany in 1998, and then Switzerland in 1999 – followed by Austria and Italy in 2000, then France, Belgium and Australia in 2001. We later expanded into the Netherlands, Spain, Norway and Sweden in 2002, and inally Denmark in 2007. Have there been any particular milestones in Alphabet’s development? One of the key milestones came in 2006 when we celebrated 150,000 cars under management. That was eclipsed when we acquired the businesses of LHS Leasing and DSL Fleetservices shortly afterwards. We ended up with over 200,000 cars by 2007 following that deal, but the numbers also swelled thanks to some really strong organic, double digit growth over that period. The major milestone came when we acquired ING Car Lease in 2011 – but in parallel, we’ve recently expanded our presence in Eastern Europe, via a co-operative deal with UniCredit Fleet Management in Romania, Slovakia and the Czech Republic. That move means we can ful il the needs of international customers – UniCredit providing a familiar brand name in those territories and Alphabet providing the underlying leet management expertise.

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What are the key numbers in terms of your fleet size – before and after the ING Car Lease acquisition? The current overall total of vehicles under management is around 474,000. But before the merger (of mid 2011) the two companies were fairly evenly matched - Alphabet operated around 214,000 cars and ING 246,000. We also operate some commercial vehicles, but largely that number is comprised of cars. Where are your largest markets in Europe by fleet size? Not surprisingly, Germany has the largest leet, with around 107,000 cars, and is closely followed by the UK (103,000 cars) and the Netherlands (87,000 cars) as Alphabet’s biggest markets. France, Spain, Belgium and Italy are our other major markets. How do the links with BMW as a parent company influence the business – do you weight fleets in favour of BMW brands? As a full service multi-marque leasing company, we have no obligation to focus on BMW, so we offer all brands – it’s about what the customer wants irst and foremost. Actually, it’s very positive having BMW as our shareholder – being part of an automotive company gives us a big advantage over banks and pure inance providers. That’s because the nature of the banking industry means inancial institutions are focused on a strong return on investment from their leet inancing arms – but are less interested in thinking strategically about things that are really important within the leet industry right now – like sustainable mobility solutions.

Can you tell me a bit more about Alphabet’s sustainable mobility solutions? TCM (total cost of mobility) is a really important issue for our corporate customers right now, as they aim to rationalise their approach to mobility and company cars. One of Alphabet’s solutions is our leasing-based corporate car-sharing scheme, AlphaCity. The concept is to provide on-demand business and personal mobility, which is keyless and fully IT integrated with BMW’s in-car telematics. Designed to reduce reliance on daily rental, taxis and using private cars for business purposes, it helps to drive down TCM. Users get access to a dedicated web page for making reservations, and depending on whether usage is for private or professional reasons, costs are then charged to either a private credit card or company cost centre. We think it’s a huge opportunity to reduce the total cost of mobility for companies, and customer feedback has been very enthusiastic so far. One of the key attractions is its availability to employees who aren’t company car drivers – companies are seeing it as an additional employee bene it in that respect.

Is AlphaCity available across Europe? So far, we’ve introduced it in Germany and are opening the scheme up to the UK at the moment. Later in the year we’ll also be introducing it in France and The Netherlands.

traditionally been strong in the premium brand sector of the leet market. Bringing ING Car Lease on board enables the combined operation to provide an enhanced, broader service portfolio.

What kind of challenges has the ING acquisition brought? The integration of two major brands was always going to bring challenges, but it’s largely going according to plan. In countries where the two brands were diverse in terms of size – such as the Netherlands, where Alphabet was a relatively small player and ING Car Lease a larger operator, integration is reasonably straightforward. But it’s more complex bringing the two operations together in countries where both brands were more evenly matched in size terms. But the upsides are huge – acquisition is a tremendously effective way for us to enter new markets quickly and ef iciently. And there has been no reduction in headcount as a result – in fact it’s quite the opposite. Strong organic growth means in some territories we’re looking to hire people. And in terms of service offering, the two businesses are also a good it – Alphabet has

As a cross border acquisition, are there any cultural differences that have come to light? We haven’t really noticed too many issues yet – perhaps because ING is Dutch and Alphabet a German headquartered operation, we aren’t too far apart both culturally and from a work ethic point of view. We like to think the combination of both businesses will re ine each other and strengthen our multi-marque leasing operations. Aside from your core business of operational leasing – do you have any other revenue streams? Yes, AlphaTact is our fleet consulting arm – we advise customers on sustainable fleet management, which means driving down their mobility costs and also their CO 2 emissions. But we also consult on driver behaviour and run training programmes to help customers respect health and safety obligations and reduce their carbon footprints.

Does Alphabet’s approach to sustainability extend to operating electric vehicles on its fleets? Absolutely – for instance in the Netherlands, we already operate EVs on our leets. It’s also an important part of our approach to TCM and sustainability that we integrate environmentally friendly cars, whether low-emissions cars or EVs, onto our customers’ leets. We also think EVs are ideal for corporate car sharing activities – particularly given their suitability in urban environments. How long does Alphabet keep vehicles on its fleets prior to disposal? It depends on the customer, but typically 36-48 months – and we work within manufacturer guidelines on maintenance programmes. Is Alphabet looking to expand outside Europe? At the moment, we’re focused on our existing network and re ining our operations to ensure we’re one of the top players in our local European markets. But we’re constantly reviewing opportunities in new markets, and taking the Alphabet brand into new countries remains a strategy we are open to.

IFW May 2012

fleet profile OPEL / VAUXHALL

STRONG FLEET SALES THROUGH TROUBLED TIMES GM’s European operation is looking to cleaner cars and Eastern Europe for growth in the fleet sector. Mark Bursa reports. The past few years have been tough for Opel and Vauxhall, General Motors’ European brands. The 2008 credit crunch sent the US Big Three into a panic, and GM Europe came within a whisker of being sold to supplier Magna – only for the parent company to change its mind 12 months later. And despite drastic restructuring in the past two years, including shutting a plant in Antwerp, Belgium, challenges remain. GM doesn’t make money in Europe, and has lost more than €10.7 billion since 1999. Last year’s losses were €570 million in Europe, which means on average, the company lost €480 on each Europe-built vehicle in 2011, compared with a €1,880-pervehicle pro it in North America.

OVERCAPACITY ISSUES Many analysts still believe that the company needs to close or sell one or two European plants in order to regain competitiveness. GM's plants in Europe run at about 65% of capacity, compared with more than 85% at Volkswagen and BMW. The ingers point at Bochum and Eisenach in Germany, and Ellesmere Port in the UK, though either cut would be dif icult. Politically it would be hard for Opel, which is seen as a German company in Germany, to close a German plant. But Ellesmere Port would be an unkind cut, as it is one of the most ef icient in the GM network. Furthermore, having a major facility in the UK does offer advantages in terms of currency – having a major plant outside the Eurozone offers more inancial lexibility. And there would be serious opposition to any further UK closures, as GM closed its Luton car plant a decade ago – closing Ellesmere Port would just leave the Luton van factory as GM’s only UK manufacturing facility. In any case, nothing can happen until 2014, when current agreements to build the Astra expire. Further complications are likely to stem from the recent announcement of a wide-ranging alliance with PSA Peugeot Citroen. The two companies say they will co-operate in areas such as business development, logistics and purchasing, and the alliance could save €0.76bn a year. But European trade unions fear the tie-up will also encompass manufacturing, and was likely to lead to redundancies and plant closures. The PSA alliance might, for the time being at least, quell any need to close Opel or Vauxhall plants – at least until the alliance has started working together. Clearly the business environment for Opel is not going to get any less demanding, with the European market set to shrink by between 3 and 5% in 2012. But the company has launched a series of successful new models in the past few years, and going forward has an ambitious new model offensive in the of ing, spearheaded by the innovative Ampera “range extender” hybrid, which could help position Opel and Vauxhall as “green” leaders in the market.

The company has launched a series of successful new models in the past few years, and going forward has an ambitious new model offensive in the offing

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MANUFACTURING FOOTPRINT The company operates plants and technical centres in seven European countries, and employs around 40,000 people. In 2011, Opel sold 1.2 million passenger cars and light commercial vehicles in Europe, achieving a market share of 6.1% and making it the number four manufacturer in Europe behind Volkswagen, Ford and Renault. Germany remains the main production centre, with production in its three factories totalling 449,000 units last year, split roughly equally between Bochum, Eisenach and the main Russelsheim plant. Russelsheim produces mainly Insignia, while Eisenach builds only Corsa. Bochum produces a mix of Astra and Za ira, including the new Za ira Tourer. The bulk of Astra production is split equally between Ellesmere Port and Gliwice in Poland, while Zaragoza in Spain is the single biggest plant, building Corsa and Meriva at a rate of 365,000 units a year. ยก

IFW May 2012

fleet profile OPEL / VAUXHALL

There is some duplication within this network, so there may be some scope for ef iciency by moving products around and sweating the capacity utilisation. Some Astra production is being moved from Russelsheim to Gliwice, for example, to help the Polish plant achieve better utilisation. The Combo small van, which was built at Zaragoza, has recently been replaced by a Fiat Doblo-based model, sourced from Turkey, and the capacity freed up at Zaragoza could be used to build other models, either for Opel or for GM’s other main international brand Chevrolet, which sources most of its European model range from Korea. Last year Opel announced it would continue its medium and large van arrangement with Renault, which sees the Luton plant manufacturing the Vivaro van for Vauxhall and the Tra ic for Renault, while the Movano large van is sourced from a Renault plant in France. The nextgeneration Vivaro will be produced at Luton from 2014, with Renault Tra ic production taking place separately for the irst time in France.

6 7 1

2 3

GM PRODUCTION IN EUROPE, 2011 1

2 3

Germany Bochum Astra H Zafira B Zafira Tourer Eisenach Corsa Rüsselsheim Insignia Buick Regal Astra J Total Germany

129,958

OPEL/VAUXHALL SALES IN EUROPE, 2011

149,773 12,637 18,345 442,039

Poland Gliwice Astra H Astra J Total Poland

21,169 152,861 174,030

Spain Zaragoza Corsa Combo Meriva B Total Spain

216,084 27,941 121,394 365,419

Country Germany UK Italy France Russia Spain Turkey Belgium/Luxembourg Netherlands Balkan states Austria Poland Switzerland Portugal Denmark Greece Sweden Ireland Finland Norway Ukraine Other Europe Other East Europe

UK EllesmerePort Astra H Astra J Luton Vivaro Renault Trafic Total UK

44,378 74,371 12,577

3,854 136,028 53,078 15,001 207,961

Total Vehicles 1,189,449 Source: Opel

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Total Europe Source: Opel

Units 268,357 268,275 121,242 101,660 67,555 62,265 54,437 49,698 46,926 35,856 28,182 22,951 18,157 13,739 12,294 11,825 9,107 6,915 5,918 6,022 1,366 467 388 1,213,602

Share (%) 7.7 11.9 6.3 3.8 2.5 6.7 6.0 7.1 7.5 5.3 7.1 6.8 5.1 7.2 6.2 11.3 2.5 6.7 4.1 3.3 0.6 1.4 0.1 6.1

PRINCIPAL MARKETS In Germany, Opel achieved third position in the passenger car market behind VW and Mercedes-Benz, with more than 268,000 cars sold and a market share of 8.02%. The secondbiggest market – just – is the UK, where Vauxhall achieved a market share of 12% and has been the number two brand behind Ford for many years. Opel also ranked in second place in Greece and Austria, third in Hungary and fourth in the Netherlands and Italy. Chevrolet remains the main “global” GM brand, but Opel is preparing to enter more export markets, including countries in the Middle East, Asia-Paci ic and South America. Announcements have been made regarding the start of exports in Israel and Chile, and Opel is to enter the Australian market in 2012 with a model line-up that will include Insignia, Astra and Corsa. Opel also plans to expand its presence in China.

AMPERA LEADS THE WAY FOR A ‘GREENER’ OPEL Fleet sales are vital to the success of the Opel/Vauxhall Ampera “range extender” hybrid. The car, and its Chevrolet Volt twin, recently jointly won the 2012 European Car of the Year award by a clear margin ahead of the Volkswagen Up! City car, the new Ford Focus and four other cars. The Ampera and Volt are ‘series hybrid’ vehicles – they have a petrol engine in addition to an electric motor, but the petrol engine does not drive the wheels directly – rather it acts as a constant-speed generator that supplies the electric drive unit and powers the car when the 16kWh lithium ion battery pack is depleted. The wheels of the car are always powered electrically. Depending on the style of driving and road conditions, distances of between 40 and 80 km can be covered in pure battery-operated mode. In extended-range mode, the petrol engine gives an operating radius of around 500 km. “This is the one that works,” says Ian Hucker, Opel’s director of European Fleet, Remarketing & Used Vehicle Operations. “We expect the majority of Ampera sales to be to leets.” The job is to convince leets of the bene its. The Ampera is not cheap – it costs around €43,000 – but the fact that it can run on electricity for a large part of its expected daily mileage means running costs are only around 10% of a petrol or diesel equivalent. Factor in expected high residuals and TCO is likely to be low too. “It can make real sense on a lease contract,” says Hucker. The low CO2 of Ampera – expected to be around 49g/km on average, also bene its companies that have internal CO2 reduction goals. And Governments are often keen to offer incentives and tax breaks for cleaner cars – the Netherlands in particular is keen to encourage electric cars. Already some major leet operators have pledged to buy Ampera. LeasePlan has ordered up to 650 of the range extender EVs, which will be rolled out to corporate leet clients across 12 European countries from November 2012. “We are pleased to develop this international co-operation with Opel for the introduction of the new Opel Ampera,” said Vahid Daemi, Chairman and CEO of LeasePlan Corporation NV. “By including the Ampera as part of our product portfolio, we can now offer an innovative vehicle which takes account of environmental considerations while providing a driving range that ful ils all the requirements of our customers.” This agreement follows a deal between Opel and Europcar that will enable the rental company to offer the model in the UK, France, Italy, Portugal, and Spain from the beginning of 2012. Opel has also been taking Ampera to its customers in a major pan-European roadshow programme. This has involved 2,600 test drives in six months and ten countries – the Netherlands, Belgium, Luxembourg, Switzerland, France, Austria, Italy, Portugal, Spain and Germany. The car was demonstrated to business people, leet managers and executives in a series of workshops and presentations as well as the test drives.

Ampera offers running costs around 10% of petrol or diesel equivalents based on expected daily mileage

IFW May 2012

fleet profile OPEL / VAUXHALL

FLEET STRUCTURE ¡

Opel/Vauxhall is a major player in the European leet sector, with a dedicated leet team in every market, as well as a panEuropean account team based in Russelsheim, which was established 12 years ago and concentrates principally on major clients in Western European markets. There is also a GM Global leet structure based in Detroit, covering all group brands and dealing with global multinationals. Opel/Vauxhall has European account managers in the UK, Germany and France – these three markets account for around 85% of the head of ices of the company’s leet customers. “Multinationals want a central point of contact,” says Ian Hucker, Opel’s director of European Fleet, Remarketing & Used Vehicle Operations. There is also a new account manager based in Budapest, handling Central and Eastern Europe, and one advantage is the

fact that all GM distribution throughout Europe is company-owned, giving extra levels of control. Hucker says the UK remains the “shining light” in terms of leet sales. “It’s the market that sets the trends, and these are followed across Europe. We bring a lot of the UK expertise into our European teams,” he says. In particular, the UK has been ahead of the curve in understanding Total Cost of Ownership – evaluating residual, maintenance costs and other factors such as insurance as part of the cost of running their leets. He says it’s rare for European clients to single-source from one manufacturer, but he has seen a trend toward reducing the number of preferred suppliers to a smaller number. As well as major “household name” customers, he has also seen a move toward pan-European purchasing from smaller companies, and these corporations

often ind this easier to implement. Hucker believes pan-European agreements only really work when the customer can genuinely in luence the car policy in each of their individual markets and subsidiaries, overriding calls for French cars from the French division, or German cars from the German division, and so on. “When they can do this, a pan-European agreement can work very well but when they can’t it can lead to frustration,” he says. Overall, the European leet market has remained relatively stable, while the retail sector has been at the mercy of economic luctuations. “Fleet demand has been solid,” Hucker says. Astra and Insignia remain the main leet sellers. Astra in particular has a growing range of body variants with different appeals – the new GTC three-door will have a strong appeal to user-choosers, Hucker believes. The new Za ira Tourer will also be a

New Zafira Tourer is expected to be a strong player in the market

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strong player. It’s larger and more up-market than the old Za ira, and offers everything that an Insignia offers in terms of comfort and inish, but with a practical, highly lexible interior that can be con igured from a seven-seater MPV to a fourseater luxury car. EXTENDED CONTRACTS There was a move toward extended contracts in 2009-10, in the immediate aftermath of the recession, but this seems to have been reversed more recently. “Extending the leet contracts brought short-term bene its, but in 2011 we saw companies on the whole reverting back to their previous policy. Companies had replaced their cars every three or four years for a reason.” The commercial vehicle did not follow the same pattern, he adds. “Commercial vehicles are more of a barometer of the economic cycle. If a building company isn’t winning new contracts, it’s not going to buy any new vehicles,” says Hucker. “The trend to extend lifecycles was not so pronounced with LCVs, as vans are typically on longer lifecycles so it might not make sense to extend these any further.” REDUCED DEPENDENCE ON RENTAL Ian Hucker believes daily rental offers a great opportunity to demonstrate Opel/Vauxhall cars to customers. “It’s a very positive tool, but it needs to be balanced against what the market can absorb in terms of used cars.” Flooding the market with ex-rental cars can have a serious negative effect on residual values. In the UK, a conscious decision has been taken to limit sales to rental companies, in a bid to keep supply behind demand and improve residual values. Elsewhere in Europe, the issue is not so pronounced, so a steady presence in the rental market is being maintained, he says. Disposal of corporate leet cars to dealers is carried out internally, though the company uses its own systems, especially in the UK, to ensure orderly disposals that maximise used values.

RUSSIAN POTENTIAL Russia is a market with signi icant growth potential, believes Hucker, who has worked in the market as managing director of Opel Russia. While the leet market in the country is small, there’s a lot of growth potential. And GM has a strong presence in Russia. Chevrolet is the number one foreign brand in Russia, largely thanks to production of the Niva SUV at AvtoVAZ’s main factory in Togliatti. This means that in Russia Opel is positioned as a “Premium German” brand rather than a volume automaker – which puts it in a strong position to capitalise on the market’s potential. In fact, with sales of 67,555 vehicles in 2011, Russia was Opel’s sixth-biggest global market, ahead of Spain. And that equates to just 2.5% of the Russian market, which is still dominated by domestic brands, notably AvtoVAZ. Opel has a new factory in St Petersburg, which makes latest generation Astra and the Antara SUV. Fleet share in Russia is still “in single igure percentages”, says Hucker – a long way short of major Western European markets, where leet sales can reach 40% of the total. “I’ve been spending time with the major leasing companies, and they’re slowly but surely developing a presence in Russia,” he says. “The leasing companies have expanded Eastwards in Central and Eastern Europe and we work very closely with them.” Part of that battle involves a change in the mindset of Russian buyers from buying purely on price to looking at Total Cost of Ownership (TCO). That’s where Opel’s more up-market image is proving helpful, as typically Opel cars have a higher residual value, which makes the TCO more attractive to leets. Astra, which is built locally, remains the number one seller, accounting for around half of all Russian sales. “Local manufacture makes a huge difference,” says Hucker. “It’s one of the main reasons we’re growing in Russia.” Initial customers typically tend to be “companies we already have a relationship with elsewhere”, says Hucker. A special “ leet model” has just been introduced, with a different speci ication geared to the needs of corporate customers. Differences include smaller wheels, which helps reduce tyre wear and thus keeps running costs down, and some add-on features as standard – such as heated seats, essential for Russian winters!

Multinationals want a central point of contact Ian Hucker, Opel’s director of European Fleet, Remarketing & Used Vehicle Operations

IFW May 2012

2012/13 fleet calendar International Fleet World’s guide to what’s happening in the fleet industry in the next 12 months – when, where and how to find out more info... April 25-2 May Beijing International Automotive Exhibition (PC, CV) www.china-autoshow.com June 6-10 Brno Autotec (CV) www.bvv.cz 14 Fleet Safety Forum Awards, Birmingham, UK www.fleetsafetyforum.org/event/fleetsafetyawards.aspx August 31-9 September Moscow Auto Salon (PC) www.oar-info.ru September 20-27 Hanover 64th International Motor Show (CV) www.iaa.de 22-30 Jakarta, 20th Indonesian International Motor Show (PC, LCV) www.dyandra.com 25-26 National Association of Police Fleet Managers Conference and Exhibition, Peterborough, UK www.napfmevent.org.uk 29-14 October Paris Mondiale de l’Automobile (PC, LCV) www.mondial-automobile.com October 10-12 Kiev International Motor Show, TIR’2012 (CV) www.autoexpo.ua 11-12 12 Annual Conference of European Leasing and Automotive Rental Industry, Cannes, France www.annual-convention.eu 20-28 Sydney International Motor Show (PC, LCV) www.motorshow.com.au 24-4 November São Paulo, 27th International Automobile Trade Show (PC, LCV) www.salaodoautomovel.com.br November 2-11 Istanbul International Auto Show (PC) www.odd.org.tr 23-2 December Guangzhou International Automobile Exhibition, China (PC, CV) www.autoshow-gz.com 30-9 December Los Angeles Auto Show (PC) www.laautoshow.com December 2-6 Riyadh International Motor Show, Saudi Arabia (PC) www.recexpo.com 7-16 Bologna Motor Show, International Automobile Exhibition (PC, LCV) www.gl-events.it January 2013 18-20 Tokyo Auto Salon 2013 www.tokyoautosalon.jp 19-27 North American International Auto Show, Detroit (Industry Preview, 16-17) (PC) www.naias.com February 2013 8-17 February Chicago Auto Show (PC) www.chicagoautoshow.com KEY: PC – passenger cars // LCV – light commercial vehicles // CV – commercial vehicles

internationalfleetworld.com

launch report Opel Ampera p40 Kia ceeâ&#x20AC;&#x2122;d p42 Peugeot 208 p44 Mercedes-Benz E-Class Hybrid p45 This could be the first hybrid executive car to make real financial sense for European fleets. p45

IFW May 2012

launch report

Opel Ampera Ampera points the way to a new future for cars, but at a price, reckons John Kendall. SECTOR Lower medium PRICE €42,900 (approx) FUEL 1.2l/100km CO2 27g/km It’s not often that a model comes along that has the potential to change cars as we know them, but that is what the Opel/Vauxhall Ampera and its twin, the Chevrolet Volt, could do. Like the Toyota Prius, it is a petrol electric hybrid, but operates in a different way. Instead of offering the choice of direct electric or petrol engine drive, or both to the wheels (parallel hybrid), the Ampera’s wheels are directly driven only by electric motor. The car carries a battery pack, giving a range of between 25-50 miles (40-80km) before it needs re-charging from a mains supply. Recharging from a standard power point at home will take around six hours and the charger can be programmed to use low-cost, off-peak electricity. At the launch, we managed 37 miles of mixed urban and motorway driving without using eco-driving techniques. Like the Prius, the petrol engine is activated when the batteries are discharged. The difference is that the 86PS 1.4-litre petrol engine in the Ampera is not connected to the wheels. It simply drives a generator that supplies electric power to the motor, once the batteries have discharged (serial hybrid). So, it means that range is not restricted by the battery

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capacity – as with battery electric vehicles – because Ampera carries 35 litres of petrol to give a range of around 310 miles. If you cannot plug in and re-charge, you can go on refilling the petrol tank, driving the car normally until you can. The European launch was set back because of the aftermath of crash tests in the US – where a vehicle caught fire three weeks after testing – because the advice to drain the batteries after an impact had not been followed. So, additional precautionary work was carried out on the battery installation before sales began. The Ampera is a strict four-seater because the batteries – weighing 198kg – are installed in a T-shape in the ‘transmission tunnel’ area and beneath the rear seats. Consequently there is no provision for a centre rear seating position. The battery carries an eight-year/100,000 mile (160,000km) warranty (UK). Driving the Ampera, like other EVs, could not be simpler. There is no gearbox, because electric motors do no need them, but there is an automatic-type gear selector lever on the centre console to select forward, reverse, park etc. Before selecting a drive mode, the driver can choose how to use the available electric power. There’s a choice of

four modes, ‘Normal’, ‘Sport’, ‘Mountain’, and ‘Hold-charge’. The ‘Hold-charge’ mode is particularly useful for driving into restricted emissions zones from a distance. Selecting this mode – the selector is a button on the centre stack – means that even if the battery is fully charged, the petrol engine will be fired up to provide drive power straightaway, without using the battery. Then, when the restricted zone is reached, switching back to the default normal mode will switch over to battery power and turn off the engine, until the batteries are discharged. It was very difficult to detect when the engine was fired up on our test drive. The engine operates at fixed speeds so it can operate more efficiently than in a conventional car. Accelerate hard and you can hear the engine step up to higher revs, but generally it’s fairly quiet. Overall we achieved an indicated 52mpg (5.4l/100km), but others achieved significantly higher figures, over the 70mpg (4.0l/100km).

verdict Ampera is very significant, pointing the way to the future because the battery pack could be made smaller, reducing the price. For now, price remains the biggest barrier.

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launch report

Kia cee’d To witness at first-hand the way in which Kia’s growing fleet ambitions are manifesting themselves on the ground, IFW publisher, Ross Durkin, was invited to Vienna for a special fleet VIP preview of the new Kia cee’d. Here he reports on some of the views expressed on the day… SECTOR Lower Medium PRICE €TBC FUEL 3.7 – 6.4l/100km CO2 97 – 149g/km At a time when many motor manufacturers are still struggling to shake off the tough economic conditions of the last three years, Kia has established itself as a brand with an impressive track record for growth. The Korean manufacturer has emerged from being a “value” brand picking up sales from the cost-conscious end of the retail market to one which is increasingly making its presence felt in certain sectors of the ﬂeet market. And while this presence may not yet be right across the spectrum of major corporates, the company has ambitious plans to reach out to an ever growing number of organisations, both through its own sales operations and via the major contract hire and leasing providers in Europe.

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With so much importance placed on the C segment in Europe, Kia used the imminent launch of the new cee’d as an opportunity to invite representatives of several major corporate accounts, as well as leasing company executives and whole-life cost guides, to Vienna for a preview of the car itself, as well as an update on Kia’s plans for growing its footprint in the major European markets. Bernard Bradley, Vice President Sales for Kia Motors Europe, explained how Kia had doubled worldwide sales between 2005 and 2011 to over six million to become the second fastest growing brand in Europe in 2011. “So far in 2012,” said Mr Bradley, “Kia is the fastest growing brand in Europe and our plan for the medium term is to grow sales volumes to

around 500,000 units by the end of 2016. “Within 12 months Kia will launch four new cars into sectors which account for 66% of all sales in Europe – Optima, cee’d, New Picanto and New Rio. cee’d enters the C segment – the second largest in Europe and one which is very important in fleet terms – where it will be up against 39 competitor models. “As well as the new products we are launching, we are also undertaking a major programme of investment in the dealer network to improve standards in both the physical and softer sense. It’s a two-and-a half-year project that would take most manufacturers ﬁve years to complete. The pace of change in our brands and products is so fast that we couldn’t aﬀord to take that long,” added Mr Bradley.

Chan Uk Jun Kia Motors Europe

Stephane Rennie ALD International

The products due to arrive in Kia’s showrooms demonstrate how ambitious the brand is in Europe, but fleet is a tough nut to crack, as fleet marketing manager Chan Uk Jun is well aware. He said: ”Our aim is for Kia to become a truly relevant fleet brand in Europe – a well-rounded mainstream alternative. ”We have invited a number of VIPs to Vienna ahead of the main fleet launch in Marbella in order to give them an insight into new cee’d. Our expectations for new cee’d are very high and it joins a model line-up that will soon be one of the youngest in Europe. ”We need to be successful in the SME sector – hence the importance of our ‘white label’ contract hire partnerships with Arval and ALD. We will launch this in 10 markets in one year as it tends to be our way to move quickly once a decision has been made. We are also taking on a number of key account managers to open doors in the large fleet sector,” he added.

With responsibility for some of ALD Automotive’s largest international accounts, Stephane Rennie has to take a ‘consultative’ approach to the emerging manufacturers. ”Few of our major customers have Kia as a major supplier at present, but that doesn’t mean things won’t change in the future,” said Mr Rennie. ”It is important for me to know what Kia stands for because my job is a consultative one and as well as advising on TCO and finance, customers also want our view on the quality and reputation of different manufacturers. Kia is a brand that many organisations don’t really know much about, particularly at an international fleet level. My customers need to know what they stand for and what they can offer. ”Kia has a number of hurdles it must overcome if it wants to be successful in fleet,” added Mr Rennie. ”The first of these is product awareness through the dealer network as drivers will not like what they don’t know. Second, it’s not that people aren’t open to change, but change in fleet is a long process with many stakeholders. HR exerts a powerful influence and a board of directors might not introduce a change in policy if it will affect employee relations. Third is the scope of the product range. Brands like Renault have done well because they have such a broad product coverage, which can be a real advantage when an organisation is reducing the number of suppliers it has.”

White label services Kia’s contract hire and leasing service will be provided by Arval in France, Italy and Belgium and by ALD Automotive in seven further markets. Arval’s International Director for SME Solutions, Renaud Warluzel (left), said: “Our objective was to enter into a partnership that was right for both Arval and Kia – a case of choosing and being chosen. “Arval took a decision to be present in both major corporate and SME channels and this partnership gives us a good opportunity for organic growth in the latter, as well as improving our model mix. Kia has a good TCO proposition – helped by the 7-year warranty – and an improving dealer network. We are working closely with them to gain a better understanding of the brand for RV and maintenance budget purposes.”

Residual value management Kia has worked with EurotaxGlass’s to ensure that cee’d and other Kia models perform well in the used car market. As Steﬀen Schick, Managing director of EurotaxGlass’s Global Services Division explained: “Residual value is the key driver of TCO. “We’ve worked closely with Kia through car-to-market studies providing provisional RVs, recommendations regarding key planning parameters such as pricing and volume, equipment and quality, and ﬁnal RV assessments. This process commences a long time before a car is actually launched. “Kia’s awareness of the importance of residual values has

increased remarkably in recent years, especially among senior management back in Korea where cars are typically kept for life. Kia appears to have more focus on the importance of residual values than some of the volume brands. “It’s hard for new brands to penetrate the ﬂeet market, especially when organisations are reducing the number of OEMs supplying them. Kia’s product is now easily good enough to convince ﬂeet managers and in most markets the cars and brand are acceptable to individual drivers, but it will take time for them to make real progress to translate rising awareness/interest into the commensurate market share.”

IFW May 2012

launch report

Peugeot 208 Has Peugeot revitalised the 200 series with the 208? Alex Grant finds out. SECTOR Supermini PRICE €11,950 – 19,300 FUEL 3.4 – 5.8l/100km CO2 87 – 135g/km Since the 205 launched in 1983, Peugeot’s 200-series has been a backbone of its range, mixing chic styling, brawny hot hatches and aﬀordability to net buyers from across the spectrum. Such is the success of the carmaker’s B-segment presence that, at 7.8m units, the 206 isn’t only the best-selling Peugeot, but it’s one of the ten biggestselling models in the world. Some of that momentum was lost with the 207, though. Chubbier and less well-proportioned than the still pretty 206 and without the GTI halo for most of its life, it lacked the same emotional appeal despite being better to drive. But the 208 promises to breathe some lost energy back into the series, and with production being ramped back up to 206 levels, it has some big shoes to ﬁll. It certainly sounds promising on paper. Shorter than the 207 and an average of 110kg lighter, Peugeot has pushed to reclaim some of the 205’s renowned agility, but in a range where all diesels and, once the start/stop system arrives next year, two petrols emit less than 100g/km CO2. Styling is a vast improvement over the 207. Unmistakeably a 200-series car in silhouette, the short bonnet and upright nose give it much cuter and compact proportions and its neatly creased, silver-embellished body lines

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with the sculpted spine over the bonnet and roof result in a truly unique identity. This is also evident inside. The cabin now feels as well-ﬁnished as the 508, with a huge glovebox and Peugeot’s intuitive new touchscreen infotainment system, which will gain useful application downloads during 2013 similar to the Toyota Yaris. But what really impresses is the driving position. The instrument cluster is perched on top of the dashboard at perfect reading height, which allows the small, thick-rimmed steering wheel to be positioned almost in the driver’s lap without obscuring it. There’s a feeling of sportiness from the moment you get inside. Unfortunately it doesn’t quite deliver on the road. The small wheel results in quick, positive steering response, but this lacks the composure and agility of a Fiesta on winding roads and has a tendency to squeal its tyres and push wide while cornering. There are some disappointments in the engine range too. At 120PS, the 1.6-litre petrol looks like an entertaining option, but it’s totally lacklustre in performance. All of the power comes at high revs, accompanied by a thrashy, harsh noise, and there’s no sixth gear to mute it at high speed. But the smaller petrols are much better. The 1.2-litre three-cylinder is slower, but oﬀers

much livelier power delivery which makes it far more entertaining to drive. With the start/stop system it’ll also drop to 95g/km next year, making this the one to have. But for real fun, the pick of the range is the peppy 115PS 1.6-litre e-HDI diesel. It can’t sharpen the handling, the glut of midrange torque results in an entertaining and responsive drive. Even the 1.4-litre e-HDI, at 87g/km, outclasses the big petrol. The ponderous electronically controlled gearbox could be overlooked for its 3.6l/100km urban economy and the convenience of losing the clutch pedal in congested city centres. Ultimately, though, it doesn’t matter that this can’t oﬀer the thrills of a 205. The 206 sold in large numbers despite a plasticky interior, wooly handling and uncomfortable driving position. This builds on the dynamic improvements of the 207 and packages them in a prettier body. With low running costs to complete the picture, Peugeot should have no problems ﬁnding homes for its newcomer.

verdict The 208 injects style and excitement back into Peugeot B-segment, with attractive running costs. But drivers expecting 205-esque dynamics will find the drive a little lacking.

Mercedes-Benz E300 BlueTEC Hybrid Modular hybrid system could be the key to competitiveness in carbon-taxed Europe, says Alex Grant. SECTOR Executive PRICE €51,794 – €55,007 FUEL 4.2 – 4.5l/100km CO2 109 – 119g/km The executive segment is about to become crowded with hybrid models over the next year. Traditionally dominated by Lexus and Infiniti, the German luxury brands are set to launch their own hybrid saloons, broadening the appeal of the technology globally. It’s not likely to be an easy market, and the business case for large hybrids hasn’t always stacked up. Lexus and Infiniti set out their stalls based on the demands of regions such as the United States and Japan, where a focus on air quality has made hybrid technology popular and commonplace. But in Europe, where taxation is usually based on CO2 emissions, big petrol engines with expensive hybrid technology usually lose out on sales to an efficient diesel engine, as the latter tends to make more financial sense. So while Mercedes-Benz was the last of the three German premium brands to announce its entry into the hybrid arena, it’s taken perhaps the most intelligent approach. The E-Class uses a compact, modular hybrid system, which requires no body modifications, can be scaled up to suit more powerful cars, is adaptable to work with plug-in hybrid technology and, most importantly, works with both diesel and petrol engines. This allows for some unique selling points. The E-Class hybrid is available as a saloon and

an estate, and comes with two different powertrains. America, Japan and the emerging Chinese market will be offered the E400 Hybrid, with a V6 petrol engine. European markets will get the E300 BlueTEC Hybrid, which pairs the same system with a fourcylinder 204PS diesel, becoming the most efficient car in its segment at 4.2l/100km with CO2 emissions of 109g/km for the saloon. Not only does this offer low day-to-day running costs, but it brings attractive tax advantages. Both body styles are exempt from new car carbon taxation in Spain and France, while UK corporate users will reap the full benefits of its low CO2 by avoiding the 3% Benefit in Kind surcharge added to other low-emitting diesel models. Keeping the battery small and reducing the need for body modifications means it’s also relatively cheap. The E300 BlueTEC Hybrid will be priced between an E300 CDI and E350 CDI, with the saloon undercutting both its rivals from Germany and Japan. Hybrid technology fits the executive class perfectly. At startup, the E-Class whispers along using the compact motor sandwiched into a 65mm space between the engine and transmission, and most low-speed manoeuvring and low-load acceleration is done on electric power. In heavy traffic, it works a

little like a stop/start system, albeit one which shuts the engine off more regularly and before the car has come to a full stop. But the system really excels at higher speeds, offering smooth, brisk acceleration assisted by the electric motor. It’s also easy to put the car into its ‘sailing’ mode by lifting off the throttle slightly, deactivating and decoupling the engine for completely silent electric-powered motorway cruising at up to 160km/h. The only thing that’s noticeable from behind the wheel is the increase in resistance as the motor switches to become a generator, which feels like someone brushing the brake pedal very lightly. So from a position where BMW and Audi have been able to offer lower-carbon alternatives to Mercedes-Benz’s luxurious executive carrier, the three-pointed star has come back to steal a lead over its rivals with this impeccably well-thought out hybrid. This could be the first hybrid executive car to make real financial sense for European fleets.

verdict An effective solution to global taxation differences, Mercedes-Benz’s modular hybrid system should offer very competitive running costs against petrol-electric rivals.

IFW May 2012

S.W.O.T.

In association with

Hyundai i30

New i30 gets the SWOT treatment Fleet Influence puts the new Hyundai i30 under the spotlight. Can it hold its own against the established competition?

internationalfleetworld.com

Wherever you may be driving in Europe, just take notice of the numbers of outgoing i30’s you see on the road. If you needed proof that the Koreans are not only coming, but are here, that should do it. Now, Hyundai have taken the new i30 onto a higher level. Strongly promoted as designed and built in Europe, Hyundai have taken the bland out of the styling and produced an elegant bodystyle which, whilst predictable in the Astra/Guilietta mould, is equally successful in its execution. With almost identical dimensions to the old model and weighing just a few kg more, the new i30 is a 5-door hatchback with good driver and passenger accommodation, suf icient rear leg and headroom and adequate space in the boot, although a little shallow (378 litres seats up, 1316 litres seats down). The interior is well inished with soft feel plastics, nicely positioned switchgear and plenty of storage areas. The steering wheel (with even the entry level boasting audio and phone controls) has a great feel as does the drivers seat, with plenty of lateral support and ample adjustment. In fact, the whole cabin experience is well up to its competitors. Is it as well specified as you would expect of a Hyundai? Well, yes. Air conditioning, Bluetooth, LED daytime running lights, a multi-function steering wheel and electric heated door mirrors are standard fitments across the range. The powertrain choice (dependent on territory) ranges from the 1.4 100PS petrol manual, through a 1.6 120PS petrol auto, a 1.6 GDi (not

in the UK or France) 135PS manual and auto, onto 4 diesels: 1.4 90PS manual, 1.6 110PS manual, 1.6 110PS auto and the 128PS 1.6 manual and auto. Both manual and auto gearboxes are 6 speed, but beware of the 110PS diesel auto – the shift in economy and emissions from the manual is painful (combined fuel consumption drops to 5.5 l/100km (51.4 mpg) from 3.7l/100km (76.3) and CO2 increases to 145g/km from 97 – active variant). As a driving proposition, this is a comfort solution. The ride is excellent at all levels with better ‘turn in’ than the previous model. The Flexsteer facility, available on all but the entry level speci ication electric power steering, has three modes, varying the degree of steering assistance, offering an easy driving experience. There is no point and squirt in this car’s settings, but it delivers safely and competently and there is no shame in that. Forward visibility is fine. Not so to the rear, where the back screen rake offers only the smallest of viewing apertures. The relatively heavy A pillars can also constrict peripheral views at times. However, these are relatively minor issues to which most drivers will acclimatise fairly quickly. The outgoing i30 was a well priced, respectable and capable car, lacking only a little stylishness and pzazz to make it memorable. Enter the new i30 – well priced, respectable and capable with copious amounts of style and pzazz added. QED.

STRENGTHS Hyundai just goes from strength to strength

with its products. There is little not to like with the i30, it ticks most boxes and fails at nothing. As ever, Hyundai price well and – coupled with a strong warranty proposition – have placed the i30 in the box seats.

WEAKNESSES The small rear window impacts visibility, as do the heavy A pillars, although we suspect these issues becomes less noticeable over time. For drivers who prefer or need auto transmission, sadly the automatic gearbox in the diesel versions doesn’t return anywhere near the right economy in line with today’s transmission technology. OPPORTUNITIES The Hyundai leet proposition is where the brand can make most progress (this is as much a threat as an opportunity). This hatchback, coupled in time with a competent station wagon, sit well with the i40 to spearhead the brand’s leet attack. The product assets are convincing, but the leet industry need to see more commitment. Get that right, Hyundai, and it could be your market. THREATS There are a lot of good competitors in this sector – Focus, Golf, Astra, Civic. i30 is a strong competitor, but as a brand, Hyundai need to promote a strong fleet proposition. Despite a growing European network of fleet business centres, it still feels like fleet is very secondary to retail.

CROSS BORDER COMPARISONS List Price Euro – Low end Top end £S – Low end Top end Spec & Trim

UK 16,855 24,180 14,495 20,795

Portugal -

Spain 15,590 25,590 -

Italy 16,300 23,700 -

Germany 15,850 25,210 -

France 16,900 26,500 -

Classic Active Style Style Nav

Base City Tecno Style -

Classic Comfort Style -

Classic Style Trend

Evidence Inventive Sensation Business Premium

Engines Petrol

Diesel

1.4MPi (99PS)

1.6MPi (120PS) 1.6GDi (135PS)

1.4 CRDi (90PS)

1.6 CRDi (110PS)

1.6 CRDi (128PS)

IFW May 2012

fleet in figures

European car market continues decline in quarter one While the overall market in Europe is down, some manufacturers are feeling the pinch, while others are booming. Land Rover registrations were up 42.8% in Q1 2012 compared with Q1 2011, thanks mainly to Evoque.

Data from the European Automobile Manufacturers Association (ACEA) shows mixed fortunes for car markets and manufacturers alike in the first quarter of 2012. While most countries in the EU 27 are showing improvements in the first quarter of 2012 – compared with the first quarter of 2011 – the contractions in large markets such as France and Spain have been enough to ensure that overall, registrations in the EU 27 are down 7.7% from 3,589,715 to 3,312,657 for the period. The gains seem to have been made in Eastern Europe, the Baltic States and Finland. Romania has recorded the largest percentage rise at 44.3%, but the volume

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is comparatively small, rising from 9,679 in Q1 2011 to 13,965 in Q1 2012. It’s a similar story for Bulgaria (+12.5%), Estonia (+23.9%) and Hungary (+22.1%). Bigger gains have been made in Poland – up 12.7% from 69,089 to 77,865 – and in Finland – up 34% from 35,677 to 47,818. Global forecaster Polk suggests that some of the Finnish increase is attributable to tax changes, which took effect from 1 April. The 0.9% rise in the UK has meant an increase from 558,366 to 563,556, probably attributable to a change in registration plates for the UK in March, when many buyers would have delayed purchase in January and February to ensure a ‘12’ registration number.

It is the big falls in France and Italy that have had the biggest negative impacts. Registrations tumbled 21.6% in France from 647,454 in Q1 2011 to 507,830 in Q1 2012. But as Polk points out, France’s Q1 2011 figures were inflated by scrappage incentives. For Italy, the decline was similar, down 21% from 514,759 to 406,907. Polk suggests that austerity measures and rising fuel prices were factors for Italy. The market has nearly halved in Portugal, with registrations tumbling 48.4% from 45,577 to 23,511. Among other weak economies, Greece was down 32% from 25,267 to 17,179, and Spain was down 1.9% from 208,151 to 204,119.

New passenger car registrations in the EU – Last 12 months Units

Percentage

1,700,000

+10.0

1,500,000

+8.0

+7.7

+7.1

+6.0 +4.0

1,300,000

1,100,000

900,000

+2.0

+0.7

+0.0

-2.1 -4.8

-1.8

-2.0

-3.5

-4.0

-4.1

-6.4

-7.0 -7.1

-8.1

700,000

-6.0 -8.0 -10.0

-9.7 500,000

-12.0 Mar ‘10/’11

Apr ‘10/’11

May ‘10/’11

June ‘10/’11

2010 volumes

MANUFACTURERS ACEA figures for manufacturers give data for the EU and EFTA. First quarter totals for the combined regions show that registrations reached 3,427,677 in Q1 2012, down 7.3% from 3,696,919 in Q1 2011. Following the pattern so far for this year, the VW Group is the top selling group while individually, VW is the best selling brand, with registrations up 1.0% for Q1 2012 to 431,901 from 427,688 in Q1 2011. Audi registrations rose 4.2% in the period to 179,629, from 172,436. SEAT is the only VW group company to see its fortunes decline, with registrations down 13.7% from 81,015 to 69,880. Skoda registrations rose 3% from 127,595 to 131,422. Jaguar Land Rover posted a 35% rise in registrations from 28,364 in Q1 2011 to 38,285 in Q1 2012. Most of the gain was for Land Rover, which experienced a 42.8% climb in registrations from 21,972 to 31,384. Other notable gains were for Kia, with a 24.6% increase from 64,208 in Q1 2011 to 79,974 for Q1 2012. Sister brand Hyundai posted a smaller increase at 12.5%, but leads in volume terms with 114,571 registrations in Q1 2012 compared with 101,865 in Q1 2011. The French manufacturers continue to have a difficult year with Renault and PSA

July ‘10/’11

Aug ‘10/’11

2011 volumes

Sept ‘10/’11

Oct ‘10/’11

Nov ‘10/’11

2012 volumes

Peugeot Citroen posting large falls. Renault recorded a 24.8% reduction in registrations from 299,364 in Q1 2011 to 225,271 in Q1 2012. Budget brand Dacia posted a 13.1% reduction, down from 65,270 to 56,698. PSA combined registrations fell 17% from 491,542 to 407,792, with Peugeot down 18.3% for the period from 266,330 to 217,461 and Citroen from 225,212 to 190,331. Fiat did little better than its French rivals with group registrations down 20%. Fiat took the biggest tumble posting Q1 registrations of 154,071, down 21.8% from 197,036 in Q1 2011. Alfa’s decline was the largest in percentage terms, down 32% from 40,010 to 27,194. Jeep’s return to market through Fiat channels offered some hope, with Q1 2012 registrations up 58.4% but on modest volumes, rising to 7,469 from 4,716. The trend for Japanese brands was also down, Toyota slipping 8.3% from 161,481 in Q1 2011 to 148,085. Lexus bucked the trend with a 34.7% rise from 6,335 to 8,531. Mitsubishi and Honda saw their fortunes decline far further. Mitsubishi registrations fell back 29% from 33,805 to 23,987. Honda saw registrations fall by 25.5% from 49,401 in Q1 2011 to 36,797 in Q1 2012.

Dec ‘10/’11

Jan ‘11/’12

Feb ‘11/’12

Mar ‘11/’12

% change year-on-year

COMMERCIAL VEHICLES As we go to press, commercial vehicle registration data for Q1 in Europe is not yet available. Trends from the February data for light CVs appear to be following a similar pattern to passenger cars. Registrations for the first two months of 2012 were down 9.2% compared with the same period in 2011, from 240,062 to 217,891, with countries showing similar growth and contraction trends to the passenger car sector. It’s a slightly different picture above that weight, with heavier vehicle (truck) registrations down 1.8% from 45,613 in the first two months of 2011 to 44,811, but again tending to follow similar trends in the weaker and stronger economies. In Portugal, for instance, registrations dropped 53.5% during the period from 621 to 289, but were up 37.4% in the UK from 4,266 to 5,862. Contrary to the car market figures, the truck market in France rose 5.5% from 7,632 to 8,051 during the period. German registrations may have declined by 9.0%, from 13,484 to 12,270, but it remains the strongest truck market in Europe. No comparative manufacturer data is currently available.

IFW May 2012

fleet in figures

LIGHT COMMERCIAL VEHICLES

LCV registration figures by market Country

Feb ‘11

Feb ‘12

% Change

Jan-Feb ‘12

Jan-Feb ‘11

% Change

AUSTRIA

2,159

2,297

-6.0%

4,511

4,458

1.2%

BELGIUM

5,147

5,620

-8.4%

10,837

11,407

-5.0%

BULGARIA

250

198

26.3%

503

401

25.4%

CYPRUS

132

256

-48.4%

287

446

-35.7%

CZECH REPUBLIC

791

756

4.6%

1,748

1,541

13.4%

1,725

1,680

2.7%

3,442

3,293

4.5%

ESTONIA

109

38.0%

255

241

5.8%

FINLAND

1,241

966

28.5%

2,504

2,171

15.3%

FRANCE

33,651

35,065

-4.0%

66,178

68,477

-3.4%

GERMANY

15,233

15,777

-3.4%

31,793

31,548

0.8%

GREECE

287

566

-49.3%

706

1,323

-46.6%

HUNGARY

953

787

21.1%

1,832

1,516

20.8%

1,414

1,460

-3.2%

3,658

3,388

8.0%

11,150

15,957

-30.1%

21,950

32,035

-31.5%

LATVIA

134

127.1%

288

123

134.1%

LITHUANIA

110

100

10.0%

237

206

15.0%

LUXEMBURG

309

275

12.4%

608

522

16.5%

NETHERLANDS

5,299

5,061

4.7%

13,681

12,841

6.5%

POLAND

3,144

2,804

12.1%

6,037

5,243

15.1%

PORTUGAL

887

2,918

-69.6%

3,000

5,376

-44.2%

ROMANIA

674

617

9.2%

1,329

939

41.5%

SLOVAKIA

457

440

3.9%

762

798

-4.5%

SLOVENIA

438

468

-6.4%

1,062

978

8.6%

SPAIN

6,898

9,217

-25.2%

12,553

16,269

-22.8%

SWEDEN

2,945

3,485

-15.5%

5,609

6,255

-10.3%

UNITED KINGDOM

8,183

11,113

-26.4%

22,521

28,267

-20.3%

103,720

118,021

-12.1%

217,891

240,062

-9.2%

EU 15

96,528

111,457

-13.4%

203,551

227,630

-10.6%

EU 10

7,192

6,564

9.6%

14,340

12,432

15.3%

ICELAND

-5.9%

-7.9%

NORWAY

2,753

2,552

7.9%

5,055

5,142

-1.7%

SWITZERLAND

2,218

2,264

-2.0%

4,667

4,348

7.3%

EFTA

4,987

4,833

3.2%

9,757

9,528

2.4%

EU27 + EFTA

108,707

122,854

-11.5%

227,648

249,590

-8.8%

EU15 + EFTA

101,515

116,290

-12.7%

213,308

237,158

-10.1%

DENMARK

IRELAND ITALY

EUROPEAN UNION

Source - ACEA

internationalfleetworld.com

industry analysis

Dieter Fess of BF Forecasts analyses the benefits of manufacturer mergers... According to Greek mythology, Hermaphroditus was the son of Aphrodite and Hermes. Due to some ‘divine’ manipulation, he became both woman (with the characteristics of his mother) and man (in some specific details a spitting image of his father….). As you may imagine: he wasn’t too happy about this, as this turned out to be the worst of both worlds for him. Thanks for sharing this useless piece of information, I hear you say, but no: I am referring to unifications in the motor industry, where sometimes it’s hard to tell whether the outcome is positive or not. Everybody is talking about company values, about the company ‘DNA’. So let’s check out some of the ‘Hermaphrodites’ and how they are doing in terms of residual values. When Jaguar was part of the Ford family and Werner Reitzle left the PAG, Jaguar was only a shadow of its glorious past. Especially when the Mondeo-based X-Type and the X-Type estate were launched, the whole community of Jaguar aficionados fell into a deep depression, which lasted until 2008 when Tata acquired the company. Since then, Jaguar has been back on track. The Indians obviously understood the DNA of Jaguar far better than the Ford managers. Today, Jaguar residual values of are on the increase, there is no longer such a thing as a pimped Mondeo, and the XK

is like an aged red wine – improving from year to year. The next example is of how somebody has lost their way over a rebadging. When Chrysler launched the 300C, it polarized opinion, a case of like it or hate it. The 300C has clearly got American DNA and played quite successfully with design features from muscle cars of the late ‘60s and ‘70s. Now, since Fiat bought Chrysler, the 300C has become a Lancia. It would have helped to contain the ‘cultural’ problems of this merger if Lancia had kept the 300C badge.

from these circumstances but Fiat/Lancia missed a good chance to improve the former Chrysler residuals. There are a lot of other mostly positive examples. There is MINI and BMW, Smart and Mercedes, Renault and Dacia – a very recent and pretty exotic example is the selling of Volvo to the Chinese company Geely with an open ending. A good example of a merger between different cultures – which worked out very well – is Daewoo and Chevrolet. Although initially, Chevrolet made the same mistakes as Fiat

A very good example of a merger between different cultures which worked out well is Daewoo and Chevrolet. Alas, the former 300C is now a Lancia Thema, which is probably not the smartest thing to do. Lancia is linked with a certain DNA, which is out of step with the 300C design. It is like promising to sell an ‘Alessi’ teapot but actually offering George Foreman’s ‘lean, mean, fat reducing grilling machine’! Fiat also re-badged the Dodge Journey as the Fiat Freemont. Although the problems there are slightly different, it would have been ultimately necessary to give some of the Fiat DNA to the car. Neither the Thema nor the Freemont residual values will suffer

regarding re-badging, pretty soon the mixture of cars made in the US and those from South Korea started to pay off. Chevrolet has shown a way to merge car segments that are very hard to combine: pure sports cars like Corvette and Camaro, with pretty decent cars like Captiva, Orlando, Cruze and so on. So, although American managers may not be particularly renowned for subtlety and forward planning, this example proves that inheriting the DNA from two very different entities doesn’t necessarily have to end in a Greek tragedy.

IFW May 2012

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