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FOR INTERNATIONAL FLEET AND MOBILITY LEADERS
#85
09/2016
LIGHT COMMERCIAL VEHICLES TOMORROW
Nexus Communication - Fleet Europe #85 - Periodic magazine - September 2016 - Deposit Office Liège X
• • • •
Tailor-fitted Connected Fuel-efficient Safe & comfort-friendly
24 PAGES
INTERVIEW & ANALYSIS
Everything on the Athlon Sale to Daimler Financial Services
44
p.
Easy Drive with Mobility Apps
36
p.
THE NEW SEAT ATECA
AN SUV TO SATISFY YOUR BUSINESS NEEDS
TECHNOLOGY TO ENJOY The New SEAT Ateca has been designed to make the workday more efficient and what’s more important, enjoyable. It’s the perfect mix of emotional and rational and comes with a confident and practical design that’s packed with all the features needed to help you on the go. It is the lightest vehicle in its segment and has the best residual value in its class when compared to the competitors basket average. What’s more it comes with Full Link Technology, Wireless charger and Traffic Jam Assist. Every aspect combines to make it the perfect partner on the road.
WHAT OUR CUSTOMERS SAY… ILONA PFÄNDER, Fleet Management Director, Prettl Group, Germany.
“The SEAT ATECA convinced me since the very first test drive. Its assistance systems and equipment facilitate our employees’ life for an extremely pleasant driving experience. When it became clear that we would equip our fleet with SUV’s, we very quickly opted for SEAT Ateca, fitting our brand perfectly and offering a remarkably good performance at a great price.”
SEAT FOR BUSINESS Average fuel consumption: 4.6-6.6 l/100 km. Average CO2 mass emissions: 94-154 g/km.
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CONTENT GETTING FIT FOR PURPOSE
5-33
No less than 968,791 new LCVs were registered in the EU in the first half of 2016. That's 13.2 % up over last year.
DOSSIER LCV MANAGEMENT
Light Commercial Vehicles are utilitarian, and lack the emotional component of passenger cars. Yet in look, feel and comfort level, they're closing the gap with the car market – for proof, go check the IAA Commercial Vehicle Show in Hanover at the end of September. Look and feel is of minor concern for LCV fleet managers. Like them, this issue, dedicated to LCV management, focuses on cost, fitness for purpose via rightsizing and tailor-made conversions, and safety. In this issue, we also provide further insight into the acquisition by Daimler Financial Services of Athlon International. The deal is proof not only of consolidation within the industry, but also of how manufacturers are positioning themselves for the future of mobility: offering dedicated services around the vehicle, as it may become essential for survival. Indeed, the OEMs also need to get fit for purpose.
Safe, greener & connected
44-46
36-37
49-51
BUSINESS
MOBILITY
INNOVATION
All the details of the Athlon Deal
Smartphone apps make driving easier
Telematics bring solutions to fleets
DOSSIER
Europe’s LCV market overview………………………………………………………………………………………………………………… 6-8 EU’s Big Five Top Brands and Models……………………………………………………………………………………………… 10-11 The future of last mile deliveries………………………………………………………………………………………………………… 12-13 LCV management Tips from 3 fleet managers…………………………………………………………………… 14-15 How OEMs and converters help LCV fleet managers……………………………………………… 18-20 LCV innovation leads to green……………………………………………………………………………………………………………… 22-24 Find what LCV financing method is best………………………………………………………………………………… 26-27 Case studies: Berendsen and NCR………………………………………………………………………………………………25 & 30 Role of expertise in LCV Remarketing…………………………………………………………………………………………28-29 Top 10 LCV Models of 2017………………………………………………………………………………………………………………………… 32-33
MOBILITY Steven SCHOEFS Chief Editor
15 NOVEMBER
15 NOVEMBER
16 NOVEMBER
FLEET EUROPE REMARKETING FORUM Barcelona
INTERNATIONAL FLEET MANAGERS INSTITUTE Barcelona
FLEET EUROPE FORUM & AWARDS Barcelona
EU’s zero emission vehicles plan for 2030………………………………………………………………………………38-39
BUSINESS
Mercedes-Benz’s, Toyota’s and Nissan’s next LCV goals…………………………………… 40-43 ARI Fleet’s future success of unbundling in fleet……………………………………………………………………48
REMARKETING
Diesel RVs stay attractive…………………………………………………………………………………………………………………………… 52-53
EXPERT
Brexit offers many fleet opportunities…………………………………………………………………………………… 54-55
ANALYSIS
Big Data transforms fleet management…………………………………………………………………………………… 56-58
MANAGEMENT
Montse Empez Vidal – Applus on TCO & Telematics……………………………………………… 60-62 Discover Fleet Europe Awards 2016 Programme………………………………………………………… 63-64 Global Fleet Conference 2016: 10 fleet management tips…………………………………… 65-66
Tailor-fitted, Safe & Autonomous Antigoni Vokou & Steven Schoefs @Antivokou - @StevenSchoefs
LCVs are continuing to flourish! In June 2016, for the 34th consecutive month, this segment grew in Europe. In the first half of 2016, there were close to a million new registrations. For conversion and equipment specialists the upcoming LCV trends are: ergonomics, safety, light-weight materials, tailor-made locally and a onestop-shop supplier, from products to logistics and service. OEMs are also offering particular attention to rightsizing and downsizing. Increased collaboration between LCV manufacturers and conversion specialists is a benefit for international LCV fleet managers. Just like for cars, connectivity and self-driving are the future as commercial fleets will be made of autonomous vans and drones.
FLEET EUROPE #85
5
DOSSIER
LCV market keeps rising Antigoni Vokou, with the support of Dataforce @AntiVokou
The Light Commercial Vehicle True Fleet market in Europe gained 12.3 % registrations in the first half of 2016 (538,632). Without any doubt, the European LCV market will keep expanding in 2017 as large companies and SMEs in Europe show an increased economic confidence with a willingness to invest. On a powertrain level, diesel still rules, while alternative powertrains stay marginal and could use a boost. Like last year, the first five months of 2016 have shown a positive trend for light commercial fleets (up to 3.5t) in the European True Fleet Market1, with a total of 538,632 new registrations in the first five months (+12.3 %). According to the ACEA, the European Automobile Manufacturers Association, the Top 20 ranking of the first semester in 2016 is: France with 215,135 new registrations and a +12.4 % increase from Jan-June 2015; UK with 191,966 (+3 %); Germany with 126,260 (+10.9 %); Spain with 87,331 (+13.8 %); Italy with 83,297 (+31.3 %);
TRUE FLEETS’ 2015 – 2016 REGISTRATIONS’ GROWTH RATES
5.8
7.1
10%
6
NORWAY
UNITED KINGDOM
BELGIUM
SPAIN
GERMANY
FRANCE
AUSTRIA
SWEDEN
FINLAND
DENMARK
POLAND
SLOVAKIA
NETHERLANDS
CZECH REPUBLIC
ITALY
-1.3
0%
SWITZERLAND
0.3
5%
-5%
Spain loses its 2015 leadership with only a +10 % rise over Jan.-May 2016. Italy’s van market expanded the most in 2016 (+30 %), plus 14,726 units from 2015. Poland regains ground after its 2015 massive decline (-46 %) with +18.1 % this half of 2016.
After Italy, the other Big 5 EU countries having progressed are: France, Germany and Spain. Van sales didn’t make progress in the UK, only 6,261 more units compared to last year. A very limited increase of its national LCV market (+5.8 %).
10.0
10.6
11.2
11.6
15%
15.0
15.3
20%
17.0
18.1
25%
A STEP FURTHER THAN IN 2015 In 2015, new vans registered accounted for 1,713,850 in the EU (+11.6 %). Demand had increased particularly in: Spain (+36.1 %), the UK (+15.6 %) and Italy (+12.4 %).
Czech Republic, the Netherlands and Slovakia all reveal considerable progress over 2015-2016 with growth rates above 20 %.
25.1
26.1
26.5
30%
30.0
Source: Dataforce
the Netherlands with 40,457 (+25.6 %); Belgium with 37,838 (+10 %); Poland with 29,811 (+22.7 %); Sweden with 25,481 (+14 %); Denmark with 19,113 (+18.6 %); Austria with 18,566 (+15.4 %); Ireland with 10,121 (+23.7 %); Portugal with 16,613 (+16.2 %); Hungary with 10,121 (+23.7 %); Czech Republic with 9,356 (+18.6 %); Finland with 6,684 (+14.6 %); Romania with 6,528 (+33 %); Slovenia with 4,953 (+38.1 %); Croatia with 4,067 (+20.6 %) and finally Slovakia with 3,838 (+19.5 %).
Switzerland is this year’s LCV loser, but with a small decline of -1.3 % with 147 units less in 2016. Norway’s market didn’t evolve at all with only 27 units of difference from last year (+0.3 %). FLEET EUROPE #85
DOSSIER
EU-12 NEW LCV REGISTRATIONS JANUARY-JUNE 2016 Source: ACEA
+7.6% +14.2%
+13.6%
EUROPE’S TOP 10 LCV BRANDS In the LCV market EU brands are predominant up to 80 %. Just like in 2015, Renault, Ford and Volkswagen remain during Jan.-May 2016 the three preferred LVC brands, but in a different order. Renault (79,567) holds the 1 st position. Volkswagen (2nd in Jan.-May 2015) is now third with 64,320 new registrations, while Ford (3rd last year) gains one place in 2016 with 75,960. There is no change for the rest of the LCV providers Top 10 between Jan.May 2015-2016, as they all hold the same places. Peugeot (4th place with 58,082), Citroën (5th with 52,985), Mercedes (6th with 50,696), Fiat (7th with 46,831), Opel (8th with 32,053), Iveco (9th with 17,095) and Nissan (10th with 16,479). The LCV brand market share is in the same order. FLEET EUROPE #85
2015 | 2016 JAN
2015 | 2016 FEB
2015 | 2016 MAR
2015 | 2016 APR
2015 | 2016 MAY
2015 | 2016 JUNE
EUROPE’S TRUE FLEETS MARKET SIZE JANUARY-JUNE 2016 Source: Dataforce 150,000
120,000
90,000
60,000
30,000
SLOVAKIA
FINLAND
CZECH REPUBLIC
NORWAY
DENMARK
AUSTRIA
SWEDEN
POLAND
BELGIUM
NETHERLANDS
SPAIN
GERMANY
ITALY
0 UNITED KINGDOM
When comparing the market size growth percentages 2015-2016 with the Top 10 true fleets new registrations it is seen that that in reality two markets truly progress: Italy with a +30 % increase and the Netherlands with +26.1 %. While the UK keeps its second position in the EU LCV market, its growth rate is relatively low at +5.8 %. The same can be said about the Belgian LCV market, 7th, with a growth of +7.1 %. The French, Spanish and German markets also show a medium increase in a year with an average +10 % for each. Poland and Sweden are respectively 8th and 9th, but grew at +18.1 % and +15 %.
+17.7%
+16.9%
+11.0%
FRANCE
BIG 5 RULE EU MARKET Most new LCVs, in the first five months of 2016, were registered in France (131,291), the UK (114,917), Italy (63,854), Germany (61,050) and Spain (29,929). The Netherlands and Belgium also recorded over 20,000 new registrations. Poland’s, Sweden’s, Austria’s, Denmark’s and Switzerland’s new registrations vary between 11,000 and 19,000. Under 10,000, are to be found Norway (9,247), Czech Republic (5,684), Finland (4,025) and Slovakia (2,835).
SWITZERLAND
During the 1 st semester of 2016, the European (EU-12) LCV market displays encouraging results with a remarkable +17.7 % in May, +16.7 % in February and +14.2 % in June.
EUROPE’S TOP LCV BRANDS MARKET SHARE JANUARY-JUNE 2016 OTHERS
Source: Dataforce
7.9% NISSAN
3.1%
RENAULT
14.8%
IVEOC
3.2%
FORD
14.2%
OPEL
6.0% FIAT
8.7% VOLKSWAGEN
12%
MERCEDES
9.5%
CITROËN
9.9%
PEUGEOT
10.8%
7
DOSSIER
TOP 10 LCV MODELS REGISTRATIONS EVOLUTION 2015-2016 Source: Dataforce
30,000
25,000
20,000
15,000
10,000
5,000
+
LCV TRUE FLEETS JAN.-MAY 2016 REGISTRATIONS
1.7 %
ALTERNATIVE LCVs SHARE IN EU BIG 5 IN JAN.-MAY 2016
8
10
OUT OF
LCV BRANDS ARE EUROPEAN
EUROPE’S TOP 10 LCV MODELS Mercedes Sprinter stays number one in the True Fleets ranking during Jan.-May 2016 with 28,880 (a growth of 11.9 % in a year). Ford Transit at second position (27,579 units) gains 27.4 % and two places from Jan.-Mai 2015. Volkswagen Transporter (25,959) loses one place with a rise of 1.9 %. Citroen Berlingo (23,454) gains 2.9 % and goes from 3rd to 4th position in a year. From 5th to 8th position the ranking is the same than in 2015: Renault Kangoo (22,330), Volkswagen Caddy (21,972), Peugeot Partner (21,495) and Fiat Ducato (20,768). Renault Trafic, 9th with 20,680 units and Renault Master, 10th with 19,670, switch places from 2015.
3
2
5 1
3
4
DIESEL FUEL SHARE FOR JAN.-MAY 2016 8
6
7
5 9
9
10 8
7
RENAULT MASTER
Renault Kangoo ZE is the preferred electric LCV in Europe2 with a share of 47.7 %. Behind it comes the Nissan e-NV200 with 25.2 %, Peugeot’s Partner EV with 9.8 % and Goupil G3 with 6 %. 1
%
RENAULT TRAFIC
ALTERNATIVE LCVs SLIGHT ASCENT In the Big 5 EU countries: Germany, France, Italy, Spain and the UK, the total of alternative fuels for LCVs, from January to May 2016, stands at 6,739 units. A rise of +11.7 % from the same period in 2015 (6,031 units). Still, when compared with diesel and petrol, the share of green engines stays unchanged at 1.7 %. Petrol’s share is 1.4 %, an increase of 0.2 % from 2015, with 5,751 LCVs. Diesel dominates the market with a share of 96.9 % at 388,551 units for Jan.May 2016, even if it loses 0.3 % from 2015.
TOP 10 GREEN LCV MODELS YTD 2016
96.9
FIAT DUCATO
PEUGEOT PARTNER
VOLKSWAGEN CADDY
RENAULT KANGOO
CITROËN BERLINGO
VOLKSWAGEN TRANSPORTER
FORD TRANSIT CUSTOM
12.3 %
MERCEDES SPRINTER
0
RENAULT Kangoo ZE 1831 units PEUGEOT Partner EV 376 units UNKNOWN N1 BEV Model 145 units RENAULT Zoe Van 81 units GOUPIL G5 21 units
2
4
6
8
10
NISSAN e-NV200 961 units GOUPIL G3 229 units CITROËN Berlingo EV 144 units PIAGGIO Porter EV 35 units VOLKSWAGEN e-Up! Van 2 units
FLEET EUROPE #85
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DOSSIER
LCV sales in EU Big 5 grow stronger Antigoni Vokou with the support of Dataforce @AntiVokou
LCV sales in the Big 5 European markets are enthusiastic with a total of 401,041 new registrations between January and May 2016. An 11.,2% rise in comparison of 2015. The European LCV market remains characterized by its stability and holds a great potential for further growth in the EU’s Big 5 over the next years.
FRANCE French brands dominate the market which with 131,291 new LCV registrations in total from January to May 2016 (+11.2 %). Renault is first (+9.4 % in a year). Peugeot, second, shows a considerable growth of 16.7 % with 25,024 new registrations. Citroen, third, gains 4.9 % in comparison with 2015. Ford (7,165 new registrations), Fiat (6,902), Mercedes (6,231), VW (5,810), Iveco (4,855), Renault Trucks (3,058) and Nissan (2,792) complete the French Top 10 respectively from positions 4 to 10.
GERMANY Volkswagen maintains its leadership in the German LCV market from January to May 2016 with 15,861 new registrations, even if compared to 2015 the brand loses 3.7 %. Mercedes, with 15,547, and Ford, with 9,028, are respectively second (+23.1 %) and third (+23.5 %). The rest of the Jan-May 2016 Top 10 is composed by Renault ( 4,600 new registrations), Opel (3,605), Fiat (3,390), Citroen (2,139), Peugeot (2,050), Iveco (1,147) and Nissan (871).
10
TOP 3 2016 LCV BRANDS
1
TOP 3 LCV MODELS
1
Renault
39.332 units
2 Peugeot
25.024 units
Renault Clio - 12.231 units
2
3
3 Citroën 22.405 units TOP 3 2016 LCV BRANDS
1
Renault Kangoo - 11.875 units
Citroën Berlingo - 9.065 units
TOP 3 LCV MODELS
1
Volkswagen 15.861 units
2 Mercedes
15.547 units
Mercedes Sprinter - 9.219 units
2
3
3 Ford 9.028 units
VW Transporter - 6.970 units
VW Caddy - 4.823 units
FLEET EUROPE #85
DOSSIER
ITALY Fiat with 20,966 new registrations (+26.03 % since Jan.-May 2015), Ford with 7,248 (+89.49 %) and Renault with 6,318 (44.,31 %) lead the Italian LCV market from January to May 2016. Follow from position 4 to 10: Peugeot (4,510), Iveco (4,212), Citroen (3,950), VW (2,608), Opel (2,428), Nissan (2,184) and Mercedes (2,113).
TOP 3 2016 LCV BRANDS
TOP 3 LCV MODELS
1
1
Fiat
20.966 units
2 Ford
7.248 units
Fiat Ducato - 6.444 units
2
3
3 Renault 6.318 units
SPAIN Renault remains leader in the Spanish LCV market with 5,424 new registrations, despite its drop of 6.2 % in comparison with 2015. Ford is second with 3,944 (+29.,3 %). Other brands losing LCV ground since last year are Citroen, third with 3,340 (-0.9 %). Peugeot, fourth with 2,693 (-4.8 %). Dacia, tenth with 1,154 (-13.4 %). Fiat with 2,455 new LCV registrations gains 3.8 % since 2015. VW with 2,415 is sixth (+42.1 %), Mercedes with 1,866 (+32.4 %), Nissan with 1,865 (+25.7 %), Opel with 1,839 (+27.5 %).
UK Ford leads the UK’s LCV market with its 28,452 new registrations in January-May rising (+23.5 % when compared to 2015). Opel arrives in second place with 14,021 (4 %) and Citroen is third with 12,257 (+7.8 %). Mercedes at 6th position with 9,363 new registrations slightly grows when compared with Jan.-May 2015 (+4.1 %). In opposition, Renault (+27.4 %), Nissan (17.4 %), Mitsubishi (+21.4 %) all grow in a year. Peugeot ’s (-12.3 %), VW (-12.9 %) and Toyota (-25.2 %) all saw new registrations decrease.
TOP 3 2016 LCV BRANDS
Fiat Doblo - 5.504 units
Iveco Daily - 4.212 units
TOP 3 LCV MODELS
1
1
Renault
5.424 units
2 Ford
3.944 units
Renault Kangoo - 3.189 units
2
3
3 Citroën 3.340 units TOP 3 2016 LCV BRANDS
Citroën Berlingo - 1.883 units
Peugeot Partner - 1.467 units
TOP 3 LCV MODELS
1
1
Ford
28.452 units
2 Opel
14.021 units
Ford Transit Custom - 12.155 units
2
3
3 Citroën 12.257 units
Opel Vivaro - 8.764 units
Ford Transit - 7.115 units
Note: All numbers of TOP 3 Brands and Models are True Fleets only.
FLEET EUROPE #85
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DOSSIER
Vans to deliver cleaner cities Jonathan Manning
Will the van fleet manager of the future be an air traffic controller, a starship trooper with an army of robots, or a vehicle logistics specialist? The problems and pressures presented by the last mile of delivery are bringing revolutionary solutions to the transport market. Innovative alternatives to dieselpowered light commercial vehicles are tackling pollution and congestion.
2 KG
PAYLOAD OF DHL’S PARCELCOPTER
2020
ROTTERDAM AIMS FOR ZERO EMISSION CITY CENTRE FREIGHT TRANSPORT
5 KM
RANGE OF THE STARSHIP ROBOT
12
Urban air quality and congestion have become urgent economic, environmental and political issues, just at the moment when online commerce has transformed the way businesses and private consumers acquire goods. E-commerce is the fastest-growing driver of urban deliveries, according to management consultancy Arthur D Little. Attempting to satisfy this demand with a fleet of diesel-powered light commercial vehicles (LCVs) looks increasingly like a short-term strategy. Cities across Europe are introducing low emission zones (LEZ) in a bid to clean their air quality. Berlin has had an environmental zone since 2010; Paris restricts traffic access to its streets when pollution levels exceed a certain threshold; Brussels will introduce a LEZ in 2018; and London will follow in 2020. The European Automobile Manufacturers Association (ACEA), warns that these ‘wildly divergent regulations’ are creating a patchwork of traffic restrictions across Europe, inflating costs for businesses. “Local authorities in the EU have approached access regulations in general, and LEZs in particular, with an array of
largely unharmonised measures, which are increasingly creating difficulties for both local and international business,” said the ACEA. “The various LEZ schemes currently implements in the EU need to be further aligned along common principles.” There is common ground, however, in the determination of city authorities to clean up air quality. National governments may concentrate on tailpipe emissions of the global warming gas carbon dioxide, but city and local authorities are focusing their attention on local pollutants within exhaust fumes, especially nitrogen oxide (NOx) and particulate matter, both heavily associated with diesel engines. In July, the new mayor of London, Sadiq Khan, announced a consultation on extending the capital’s LEZ, citing figures that about 9,500 Londoners die every year form long-term exposure to air pollution and 443 schools in the capital are in areas that exceed safe, legal pollution levels. The City of Rotterdam, meanwhile, aims to have, “a zero emission freight transport in the inner city by 2020,” said Pex Langenberg, vice mayor.
FLEET EUROPE #85
DOSSIER
But the essential use of vans in city centres extends well beyond freight transport, with fleets of all sizes relying on LCVs as transport for employees and their tools. For these organisations, a switch to lower emission, alternatively-fuelled vehicles could deliver major financial savings, according to environmental campaign group Greenpeace. Last year, it claimed car and truck fleet managers in Europe could cut their fuel bills by about 14 % and save 53 million tonnes of CO2 if they switched to low-carbon vehicles and took other steps to reduce fuel use. One of the biggest van fleets in the UK, British Gas, has pledged that 10 % of its 13,000 home service LCVs will be electric by 2017, reducing its carbon emissions by 7.3 %. The company has been trialling the Nissan eNV200 van, and says the electric vehicle delivers a financial saving over its diesel counterparts, so long as it covers at least 10,000 miles (16,000 km) a year. “In London, the cost savings could be as high as 20 %,” said British Gas, “With other locations representing about a 6-10 % saving over diesel.” Emissions, however, are not the only issue that regulators are looking to control, with delivery fleets blamed for congestion as well as pollution. “Freight vehicles typically represent 8-15 % of total traffic flow in urban areas and, when they park to make collections or deli-
veries, they often reduce road capacity and contribute to congestion,” said Ian Short, lead partner in LaMiLo (Last Mile Logistics, a project part-funded by the European Regional Development Fund). As a result, innovative delivery solutions are starting to appear. Logistics giant DHL, for example, has run three successful trial with its ‘parcelcopter’, an autonomous flying delivery drone capable of carrying a payload of up to 2kg for 8.3 km. For Ahti Heinla, co-founder of Skype and chief executive officer of Starship Technologies, the future of last mile deliveries lies not in the air but on the ground, with an army of robots. “Our vision revolves around three zeroes – zero cost, zero waiting time and zero environmental impact.” said Heinla. Trials of Starship’s robots were due to start in Düsseldorf, Bern and London last month [July 2016], with each robot capable of carrying the equivalent of two grocery bags for 3-5 km from a local hub. “They travel at the slow speed of four miles per hour [6.5 kmh] – a brisk walking pace,” said Heinla. “They travel on pavements, blending safely in with pedestrian traffic.” And most importantly, the cost is, “10-15 times less than the cost of current last-mile delivery alternatives,” said Heinla.
An army of starships robots aims zero cost, zero waiting time and zero environmental impact.
VISION OF THE FUTURE Science fiction will rapidly become reality as fleets operate zero emission light commercial vehicles for last mile deliveries. Pushed by environmental legislation and taxes and pulled by green-focused clients, the short range required for city centres makes this the ideal scenario for electric vans, with employees able to recharge batteries at numerous recharging points. Vehicle telematics and connectivity will help fleets operate when roads are quieter, to minimise congestion; while lighter loads will be delivered by drones, either in the air or robots on the ground.
Autonomous flying delivery drone DHL Parcelcopters will handle future deliveries for 8.3 km.
FLEET EUROPE #85
13
DOSSIER
Tips to match the LCV with your fleet Frank Jacobs @FrankJacobs
Fleet Management is not an exact science. For example: ask a number of fleet managers after their Top Five criteria for choosing LCVs, and the combined answers will be a multiple of five. But some answers do occur more often than others: the vehicles must be safe and, above all, fit for purpose! Less emotion, more focus on getting the job done as cost-efficiently as possible. Work horse versus show pony: that is the main difference between selecting an LCV and choosing a benefit car. Most LCV selection criteria will be familiar to all fleet
managers – reduce TCO, leverage fleet size, mind CO2 emissions and fuel consumption. But the singular focus for selecting LCVs is on getting the job done. As the testimonials of these fleet managers prove.
LOCAL SOURCING “We select and procure our vans like we do our cars”, says Peter Højgaard (ISS). “We've set up what we call 'Local Sourcing Initiatives'. These LSIs are frameworks for utilising group agreements to select and procure vehicles at the local level”. And the ISS criteria are? 1. Fit for purpose: “The overriding criterion is that the vehicles fit our operational needs”.
our operational needs, and rolling out that standard across our fleet”. 4. Safety: “It is absolutely essential that drivers have a safe vehicle at their disposal when carrying out their work”. 5. Environment: “We are seeing more and more LCVs come into our fleet, helping us drive down emissions and pollution”.
2. TCO: “If we're satisfied that operational needs are met, we make sure that we procure the vehicle with the best overall TCO, in order to generate savings and drive down cost”. Peter Højgaard (Head of Group Fleet Management at ISS)
14
3. Right-sizing: “We continuously work on matching the right size of vehicle to
FLEET EUROPE #85
DOSSIER
EMPLOYEE ENGAGEMENT “Employee engagement is crucial for us”, says Janos Kis (Coca Cola). “We therefore involve our colleagues who get to drive the actual LCVs in the selection process. Our aim is to capture their opinion about different potential models, so we make sure they get the opportunity to test them”. 1. TCO: “This covers the whole spectrum of the operation, including fuel cost and – if applicable – driver efficiency”. 2. Fit for purpose: “A vehicle should be right-sized, but able to perform its given tasks. Over- and underspecification are both definite no-nos. Both smaller/cheaper and larger/more expensive vehicles are not fit for purpose, and will likely cost more in the long run”.
3. Safety and CO2: “Safety of our employees, and the health of the communities they work in, is key”. 4. Driver opinion: “Company LCVs are used extensively, hence the importance of employee input in the selection process. We collect their feedback in a formal evaluation sheet, assessing nearly 30 features of the vehicle. The results are incorporated in a balanced scorecard”. 5. Overall OEM sourcing strategy: “We leverage the size of our fleet and attempt to concentrate volume with fewer suppliers across various segments; this often generates additional cost savings”. Janos Kis (Coca-Cola Enterprises)
SAFETY PARAMOUNT “As a provider of services, our company employs customer engineers whom we can also use to service the equipment of our company itself”, says Marina Ostojic (NCR Corporation). That is one purely economic factor of importance in the decision process towards selecting LCVs for the company fleet. Cost efficiency in general is obviously an element. But there are others: 1. Safety: “Vehicle safety is paramount. We test each prospective model for a minimum of three weeks, using different engineers. Usually, we test three types of LCV from three different OEMs. During our tests, we take a wide range of criteria into consideration, including but not limited to brakes, seat belts, airbags, tires, etc. Only after three weeks of rigorous safety testing do we proceed further with our selection process”. 2. Payload: “Payload weight and space requirements are crucial, as our engineers are sometimes required to carry heavy,
FLEET EUROPE #85
bulky tools. Because of this importance of load space, we take great care to select LCVs that have sufficiently large dimensions”. 3. Equipment: “We are keen on getting the right equipment in our LCVs, especially useful options such as navigation systems, bluetooth connection, parking sensors, cruise control, slide doors. From our perspective, these are basic equipment elements, that will allow our engineers to respond to our customers' calls in the most efficient way, whilst avoiding any damage to the vehicle while in operation”. 4. Operating parameters: “CO2 emissions, fuel consumption, overall cost of operation and in general all operating parameters are carefully examined and factored in to our selection considerations”. 5. Replacement: “The replacement time of the vehicle is another essential element in our evaluation”.
Marina Ostojic (NCR Corporation)
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A game-changing line-up – for any fleet. Mercedes-Benz International Key Account Management. Whatever challenge lies ahead of you and your fleet, all of us at Mercedes-Benz Vans are always willing to put in an extra shift to get the job done – and to do it well! That also goes for our International Key Account Management. Both before and after your van purchase, they’ll be ready to advise you on offers and solutions tailored to your needs – so you and your team always get the right result.
Provider: Daimler AG, Mercedesstr. 137, 70327 Stuttgart
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Efficiency without your hair turning grey Steven Schoefs @StevenSchoefs
Specialisation breeds complexity. Add an international dimension to the already complicated picture of LCV management, and you can almost see the hair of LCV Fleet Managers turn grey. Fortunately for them, both manufacturers and converters are willing and able to help.
By virtue of the global appeal of their products, the main LCV manufacturers have knowledge at hand and structures in place to help their international customers with the peculiar problems of managing LCV fleets across national borders. Of course, each approach has to marry the local to the international. But each manufacturer has a different modus operandi – so prospective customers would do well to study the variety of manufacturer outreach on offer, and to find the one that fits their needs best. TAILORED SUPPORT Tailored support is key, but that key unlocks many different doors. Depending on customer needs, Hyundai offers international fleet support either at market level, or via the fleet team at its European HQ, but always in coordination with the markets. Renault divides its attention differently: it offers a central approach for strategy, and a regional and local one for the more immediate, business-oriented aspects of its client relations. The modus operandi of Mercedes is not dissimilar: it offers its international customers a central approach in terms of contracts and strategic, HQ-to-HQ matters; but it also acts locally, by maintaining contact with customers in all respective markets, meeting their demands with operational deliveries and service. KEY ACCOUNTS Some OEMs emphasise one approach over the other. Volkswagen Group generally takes care of its international customers from its Wolfsburg HQ, especially if annual sales exceed 300 units. Additionally, there is VW Commercial Vehicles in Hannover, with its own Key Account Manager (KAM)
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department, which takes care of big national key accounts and international key accounts with sales less than 300 units p.a. However, Volkswagen also has dedicated Fleet Sales Managers in each European country, supported by National Key Account Managers and Fleet After Sales Managers. Fiat, on the other hand, responds to customer needs primarily through its network of local referral points, labelled Fleet & Business Centers, and through National Key Account Managers. But no yin without yang: Fiat also has International Key Account Managers (IKAMs) for its big international corporate clients. POINTS OF CONTACT Ford's approach: dedicated Fleet Sales teams at national level, support for pan-European customers by a team of Key Account Managers at European level. Again, it's about combining easy access and local knowledge with the leveraging power of cross-market expertise. See also Nissan, which has a central teal of five IKAMs for Europe, and a total of 50 National KAMs in spread across its European markets. On top of that, the brand also has a dedicated LCV Sales Team, again both at central and local level, supporting specific product, services and conversion needs. Nissan also offers help on a global scale, with a Global Fleet Team, ensuring a single point of contact worldwide, and a coordinated global approach. At Opel the one-stop-shop approach is synonymous with good Key Account Management. There is a team of Opel people dedicated to large customers – and,
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vice-versa, each large customer perfectly knows who is his dedicated Key Account Manager at Opel: his individual one-stopshop contact. DRILL OR NO DRILL? The main objective of international fleet clients is for their LCV business, which is necessarily highly specified, both because of the variety of jobs to be done, and by the various national preferences per market, to be as harmonised as possible. LCV manufacturers are not the only parties reaching out a helping hand to their international customers. Also the converters – the companies fitting out the interior of the LCVs for the specific uses of various clients – offer support, again in a variety of ways. Modul System offers help already in the tendering process. Within the EU, legislation is broadly the same, but where local rules require a different approach, the company is willing to adapt its products and practices. Not a problem, as customisation is the name of the game for companies in the conversion business.
Legislation, by the way, is not the main obstacle in the Swedish company's experience. Variation is usually the result of national tastes and traditions. Some markets may not accept drilling through the van body, while others will, for example. These differences are also subject to change, by the way. According to Modul System, the drilling option is destined to become more common, as it is safer in case of electrical installations and offers better resale value. COMPLEXITY VS. VOLUME Most LCV fleet demands are local, says Snoeks Automotive, but the Dutch company does have an extended international service network to both service OEM-built products and convert local-stock vehicles. The company finds that the biggest obstacle to international fitting/conversion agreements with OEMs is the issue of finding a balance between the risks and benefits of such an agreement. That follows from the fact that conversions are a niche, compared to mainstream production. It's all about managing complexity, not turning over volume.
The main objective of international fleet clients is for their LCV business to be as harmonised as possible. Both LCV manufacturers and conversion specialists are responding to this demand with tailor-fitted services and a one-stop shop approach.
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Sortimo's advice can provide centralised or local answers to customer requests for customisation, depending on the complexity of the racking and the customer's own organisation. The flexibility is the result of Sortimo's setup, offering global solutions that can match local regulations and preferences, backed up by a number of subsidiaries and presences throughout Europe and beyond.
fleets, but rather to their local partners that fit or transform their vehicles. The company has a half dozen dedicated employees throughout Europe, providing local fleet managers with advice for their country-specific needs. For instance: ladder regulations vary per country, and Prime Design can adapt its products, while maintaining an international pricing and delivery offer.
Prime Design Europe doesn't sell directly to end customers or international
FORD In 2016 Ford launched the new Transit (2-tonne segment) and Transit Custom (1-tonne segment), featuring the allnew EcoBlue diesel engine, in addition to new electrical and driver assistance technologies.
MERCEDES The Mercedes Sprinter is this year the most popular LCV model on the European True Fleet market, achieving nearly 30,000 new units sold between January and end of June 2016.
VOLKSWAGEN Volkswagen will soon launch its new Crafter. The expected market introduction will be in the beginning of 2017. The new Crafter comes with a complete product portfolio, with Front & Rear Wheel Drive, 4MOTION & Automatic Transmission and is prepared for the future with several options like driver assistance systems and Connected Van.
FIAT Fiat just completed the renewal of its LCV range, with the launch of the mid-size van Talento
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and the Fullback pick-up, while Doblò and Ducato are becoming Euro 6.
RENAULT Since years Renault is a dominating force on the international LCV market. The brand sells LCVs in 112 countries, with top markets being Europe, Brazil, Argentina, Turkey, Morocco and Algeria. Renault has a leading position in the electric LCV market.
NISSAN Nissan is one of the fastest-growing LCV manufacturers in Europe. In November the new mid-size van NV300 will go on sale. NV300 replaces the previous Primastar and will come in Panel Van, Crew Van and Combi formats.
SNOEKS AUTOMOTIVE BV Founded in 1956, Snoeks built up decades of local experience in the Netherlands before going international in 1994.
OPEL In 2015, Opel grew faster than the market with each of its three main models: plus 12% for Combo, plus 25% for Movano and plus 38% for Vivaro. The Opel brand sells over 110,000 LCVs a year.
PRIME DESIGN EUROPE Headquartered in Belgium and with production facilities in Belgium, Denmark and Bulgaria, Prime Design is a challenger to the standard range of accessories on offer on the LCV market.
HYUNDAI Last May, the Hyundai H350 celebrated its first year of European market entry in 9 countries, now to be expanded to 14.
MODUL SYSTEM
SORTIMO A pioneer 40 years ago and a market leader today, Sortimo is based in Germany with 9 subsidiary companies and 25 partner stations, a presence in over 35 countries and with more than 1,000 employees worldwide.
Founded in 1970, it is a pioneer in the vehicle racking business. The Swedish company has subsidiaries and distributors throughout Europe, as well as sales in China and Japan, and distributors in South Africa, Colombia and Australia.
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Building the LCVs of the future Frank Jacobs @FrankJacobs
The LCV sector has made great strides in recent years, and both manufacturers and converters will continue to innovate – for two reasons. Because competition for market share is fierce, but also because rules and regulations are increasingly strict. EU regulations have a major impact on automotive in general, and the LCV sector in particular. The impact of Euro6, the new emissions norm that will come into force from September this year, is considerable. Of course, all manufacturers have made sure that their product line complies with the new norm – most have been compliant for several years already. RESTRICTIVE STANDARDS But innovation in this case at least comes at a price. Each new emissions standard is more restrictive than the previous one, and each requires a relatively larger effort by manufacturers to comply. The cost of developing ever cleaner engines is passed on to the customer, with prices for Euro6-compliant versions of the same LCV models trending up, across all manufacturers. However, cleaner engines also tends to imply less fuel consumption, so the increased list price is offset at least partially by lower fuel cost. ALTERNATIVE POWERTRAINS The slow yet steady growth of alternative motorisation options is also having an effect on the commercial vehicle sector. Nissan, for example, has the e-NV200 on offer. As a fully electric van, it is still a
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rarity on the market. But there are other full-electric options. Renault offers the Kangoo Z.E. and the Twizy Cargo, and promises to improve and extend the technology – especially regarding autonomy. Mercedes is also a pioneer in electric LCVs, having launched the Vito E-Cell in 2011. The manufacturer is convinced this is the path of the future, as it thinks that a large part of delivery traffic in city centres will be restricted to electric vehicles. LOW DEMAND 2011 is also when Volkswagen initiated large-scale fleet tests with electrified Caddy prototypes. However, despite positive test results for these batteryelectric city delivery vans, Volkswagen says demand for the 'e-Caddy' remained low, due to few incentives and high battery cost. Which is why it does not offer an electric version of the fourth-generation
Caddy. VW does offer the e-load up!, a small electrified commercial vehicle with city capability and a range of about 120 km, and EcoFuel versions of the Caddy and Transporter, with combined petrol and CNG fuel capacity. The most popular way forward however is to improve the mainstream motorisation – and that still is internal combustion. Ford, for example, while reviewing its options on hybrid and/or electric powertrains for its LCVs, focuses its curent efforts on providing high-efficiency, low-emission engines, like its EcoBoost family of petrol engines, and EcoBlue for diesel. FUTURE TRENDS And finally, Fiat is a bit of an outlier, with its strong preference for – and market leadership in – CNG as an alternative powertrain, available for the Ducato, Fiorino and Doblò.
The slow yet steady growth of alternative motorisation options is also having a positive effect on the commercial vehicle sector, but a positive boost to increase alternative powertrain appetite would be welcome. Here the Renault Kangoo Z.E.
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Motorisation isn't the only aspect of the LCV business that is likely to change dramatically in the future. Another major inflection point is connectivity.
project coordination and logistics to service provision. Quite often, they are eminently able to respond to, and even anticipate, local market demands and specificities.
Hyundai, for example, is anticipating a significant penetration of telematics and digital services in fleets, improving efficiency and productivity. And so is Nissan, which plans to offer fleet asset management possibilities on all models, aimed at reducing TCO. Saying its vehicles are becoming smarter and safer at the same time, Fiat is working to offer such connectivity benefits as crash management, remote monitoring, geo-fencing, speed monitoring and live traffic info.
Prime Design Europe, for example, take pride in offering ergonomic ladder racks for the full range of LCVs and pickups, with the ability to adapt to local conditions and special requests.
MARKET SPECIFICITIES Of course, manufacturers aren't the only ones affected by the quest for innovation in the LCV domain. Outfitters/converters respond to the changing market by offering total solutions, from the products themselves over
Modul System for its part offers the Modul-Connect system, a digital modular wiring system that is easily adaptable, very dirt-resistant and supports a variety of lighting options – and will launch a completely new flooring and lining system at this year's IAA in Hannover. Also at IAA, Sortimo will showcase a number of accessories and enhancements to its product range, and introduce three new products in the intelligent mobility sphere.
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Telematics improve decision-making Tim Harrup
Berendsen is a focused European textile, hygiene and safety solutions business with leading positions in most of the 16 countries in which it operates. Its fleet consists of around 2,800 vehicles with a mixture of HGV’s, LCV’s and cars. The subject of centralised data, telematics and how these systems may help fleet operations is, therefore, of great interest to Berendsen, and is an on-going project. For Robert Hitchcock inappropriate driving adds risk on other road users when LCVs are concerned.
COMPANY Berendsen AREA OF ACTIVITY Textiles FLEET MANAGER Robert Hitchcock JOB TITLE Mobility Category Manager NUMBER OF UTILITY VEHICLES 2,800 COUNTRIES Europe-wide
Telematics and data systems help Berendsen to get greater knowledge of where the highest costs are being incurred by drivers and why.
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The subject is so important to Berendsen that they are putting the supply-side up for review at the moment. And Robert Hitchcock, Mobility Category Manager, is very clear about the areas in which he wishes to see benefit from the telematics system. Berendsen is in particular looking to increase data visibility, giving all of the various locations the information they need on driver behaviour, vehicle tracking, and whether this can link into route optimisation. There is an initial focus on the UK which, if successful, will lead to best practice being rolled out fleet-wide. The telematics system, alongside a reporting tool system, will lead to the identification of centralised trends, so that more informed and widespread management decisions can be made. IDENTIFYING DRIVER TRENDS Driver behaviour is an area which is highlighted by Berendsen, and any system will be expected to highlight differences in driver behaviour which will influence the type of driver training that may be necessary. This will emerge from having a greater knowledge of where the highest costs are being incurred, and why. As an example, Robert Hitchcock will be able to have more detailed information on where the most
fines are being incurred by drivers. In these cases, sharing the data with bodies such as trade associations may be able to identify paths for change or for training. ROAD SAFETY Robert Hitchcock is aware that not only does an inappropriate driving style lead to higher costs for the company, but it also brings danger to other road users with it, especially where commercial vehicles are concerned. Telematics will also be able to highlight where there is a concentration of accidents, and show trends which can be addressed. Other specific areas which will be a target for improvement through better information include decreasing idling time. And the fact that drivers know that data is being recorded is in itself a help in this domain. Berendsen will be looking to use centralised data and individual information as inputs when reviewing policies and to make specific modifications to the way in which the fleet is managed. A very specific set of requirements, therefore, building on an existing system and continuing to improve – and with an acute awareness of what is at stake when vans take to the roads.
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The pendulum swings towards leasing Frank Jacobs @FrankJacobs
Is it better to lease or buy? For car fleet managers, the preferred solution is leasing – keeping in mind that in some cases and places, buying may be better. For LCVs, the consensus used to be for purchasing, but has now also swung towards leasing. Yet here too, exceptions prove the rule.
WHY LEASING LCVs IS BETTER As for cars, leasing LCVs requires less capital, and allows you to translate the cost of running an LCV fleet into a fixed monthly cost.
WHY BUYING LCVs IS BETTER Buying an LCV makes more sense if it is a highly specialised vehicle, giving you maximum flexibility on usage.
Traditionally, LCVs were purchased rather than leased – but that trend has been reversing for some time now. That's thanks to lease companies having greater expertise in LCVs, and more LCV-specific solutions. So, what are the arguments pro and con purchasing LCVs these days? EASE OF FUNDING “Cost control, transferring residual risk to the lessor, ease of funding, keeping the asset off-book: those reasons for leasing cars also apply to LCVs”, says Peter Højgaard (Head of Group Fleet Management, ISS World Services). “Purchasing will only happen if an LCV's special needs or size make leasing unprofitable”. “Regularly changing leased LCVs gives companies the opportunity to make use of the latest, more economical engines developed by the OEMs”, says Marina Ostojic (Commodity Manager, NCR Corporation). However, “in some less mature markets, purchasing LCVs often is the only option”, says Janos Kis (Senior Procurement Manager, Coca Cola Enterprises). MOBILITY TOOL “LCVs are usually purchased by companies that can service and repair them themselves. Since only larger companies can
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afford that, we definitely see a trend towards leasing LCVs”, says Benedikt Schell (Head of Sales & Marketing, Daimler Financial Services Europe). “An LCV is a mobility tool. As the lifecycle of a leased LCV is shorter, leasing is a better way to have a vehicle that is up to date with all the latest technology”, says AndréFrançois Algrain (Technical Pricing and Operation Manager, ALD International). “Some companies consider these tools to be core assets, and wish to retain full control over them”, says Nathalie de Vries (Senior Consultant, LeasePlan International). “But purchasing brings risk, and requires expertise. That is why companies ultimately prefer to lease their LCVs”. PENDULUM SWINGS So much for the theory. On the terrain, the pendulum has indeed swung clearly towards leasing. Only legacy or specialty LCVs are still purchased. “Our policy won't even allow us to purchase”, says Marina Ostojic. “Except a few old units shortly to be replaced, all our LCVs are leased”, says Janos Kis. “Full service leasing allows us to minimise risks related to operation, RV, etc.” “The primary financing strategy for our full fleet is to lease, and LCVs are predominantly leased as well. Only extremely specialist vehicles can be purchased, on a case by case basis”, says Peter Højgaard. EQUIPMENT QUESTION But LCV fleet managers also have to think about the fit-out of their vans. Should FLEET EUROPE #85
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they purchase their equipment, or lease it? “Does the equipment age the same way as the van? Questions on the respective durability of the LCV and its equipment are crucial”, says André-François Algrain. ISS typically leases its equipment with the vehicle, says Peter Højgaard. “But if the equipment is more costly, it can be bought outright and transferred to a new vehicle at the end of lease. “We recommend that any equipment be purchased directly, as this gives greater flexibility for re-use and cost-effectiveness”, says Frank Hess (Manager Marketing, ARI Europe). “We generally recommend a turnkey solution, whereby the client receives the van fully equipped and ready to use. Leasing the equipment creates a single point of service, single stream of invoices and unburdens the client”, adds Helen Cooper (Director Automotive Supply, After Sales & Consultancy Services, LeasePlan Supply Services). TRANSFERRING EQUIPMENT Depending on which choices a fleet makes, the vans and their equipment can be in two different replacement cycles. What then is the best policy to deal with transferring equipment from one vehicle to the next? “There are three main factors to consider”, says Helen Cooper: “One, the cost of de-installation and re-installation; two, whether the old fitting is fit for purpose for the latest job needs; and three, safety”. Says André-François Algrain: “It is best to have the equipment included in the leasing and change it with the new model. This will keep the RV at a higher level”. “We try to specify the equipment to fit several of the vehicles available in the same segment”, says Peter Højgaard. STANDARDISED VS TAILOR-MADE Nobody knows the equipment issues as well as the conversion and equipment specialists themselves. Do they believe fleet managers should opt for tailor-made solutions, or choose off-the-rack, standardised convertible equipment? Opinions are divided. “A tailor-made for each fleet creates the lowest TCO”, says Thomas Johansson, FLEET EUROPE #85
LCVs are usually purchased by companies that can repair them themselves.
Vice President at Modul System. Whereas Andrea Beck, Project Manager International Marketing at Sortimo, finds this really depends on the client: “Every organization and strategy is different and we need to adapt to the requirements of our customers”. “Fleets tend to find tailor-made conversions locally, but on the other end of the spectrum, OEMs try to offer as many options upfront as possible, to secure quality”, says Robbert van den Broek, Marketing & Sales director at Snoeks Automotive B.V. There is also a diversity of opinion on the subject of buying versus leasing the equipment. Thomas Johansson (Modul System) says both systems have their advantages, but “of course leasing is preferred when the leasing companies drive the deal”. Most of Sortimo's clients lease both the vehicle and the racking. “The decision towards buying or leasing the racking is linked to the financial policy of the client”. For Robbert van den Broek (Snoeks), buying makes more sense: “Few lease companies know how to deal with the residual value of equipment and its conversion, and therefore write it off entirely over the lease period”. So, what does the future look like for conversions of LCVs? And what will be the added value for the international fleet customer? “Following international agreements with OEMs and leasing companies throughout Europe, we expect that fleets will want to cooperate also for accessories with companies that have an international scope, and that work within the requirements of the manufacturers”, says Koen Bessemans, Managing Director at Prime Design Europe.
60 %
UP TO OF TCO
WHAT LCVs MAINTENANCE CAN REPRESENT. FOR CARS, IT'S UP TO 8 %
54-72 NUMBER OF MONTHS LCVs RUN, WITH MILEAGES OF UP TO 300,000 KM
3
TIME HIGHER
LEASE CHARGES AT THE END OF LIFE CYCLE FOR LCVs THAN CARS 27
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Remarketing LCV depends on expertise Frank Jacobs @FrankJacobs
Managing LCV fleets is more complex than car fleets. And that definitely includes the remarketing aspect. “But it doesn't have to be a headache”, says Wolfgang E. Reinhold. “You just need the right kind of expertise”.
“Company cars are show ponies, fleet LCVs are work horses – that's the essence of the difference”, says Reinhold, Senior VP for Car Remarketing & Operations at LeasePlan and Chairman of CARA, the European Car Remarketing Association. How that affects residual values (RVs)? Here's just one way: “The amount of paperwork is exponentially different. For a car, we generally need 10 pictures to establish damages. For LCVs, the average is 40 pictures – due to the greater intensity of use, there will be more dents and scratches”. THE PURPOSE As a rule, “the increasing number of new LCV registrations, combined with higher discounts - often twice as high as for passenger cars - have put the residual values of LCVs under pressure on most European markets”, says Magnus Lövsund, Head of Valuations at EuroTaxGlass’s. But ultimately, LCV RVs are determined by a much wider range of variables than those of cars. The basic question is: What is the purpose of the van? The answer will determine the configuration of the van – and that will eventually determine its RV. It's that variety of LCV configurations that adds complexity to the remarketing phase. LCVs usually come in standard, medium and high versions for both length and height. Increasing the possible configurations are the questions whether the vehicle has one or two sliding doors, a door in the back or not.
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“Take for instance a van delivering cigarettes: that is a valuable commodity, so the vehicle is likely to have only one door, to minimise the risk of theft. Makes sense, but that makes the LCV less useful for other purposes, and thus reduces its potential RV”, says Reinhold. MANUFACTURER NETWORK And then there is the manufacturer network to consider. There are about 10 major LCV manufacturers, but their geographic presence can vary greatly. “Service network and utilisation cost are substantial criteria – more for LCVs than for cars”, says Lövsund. “Where utilisation costs make up circa 40 % of a car's TCO, for LCVs this is more than 50 %. This is driven in particular due to higher fuel consumption, insurance, taxes and wear and tear. Hence the importance of the quality and professionalism of the service network”. Sales figures reflect these regional variations. The Transit, for instance, dominates the UK market, with a share of 44 %. “Ford is considered a 'home-grown' brand in the UK”, says Lövsund. Next in line in the UK are the Mercedes-Benz Sprinter (20 %) and the Peugeot Boxer (6 %). In Germany, the Sprinter has the home advantage, with a market share of 29 %. It is followed by the Fiat Ducato (20 %) and the Transit (17 %). TOP RV PERFORMERS That bewildering complexity makes LCVs much more difficult to remarket. “But that doesn't have to be a headache. You just need the right kind of expertise. Which is why
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The configuration of the van is “the” determinant factor of its RV.
remarketing LCVs in our case is much more aligned with the truck department than with the car department”, Reinhold says. Although rebuilding of high-specification LCVs may result in remarketing success, in general it is the standard conversions that are the more valuable units on the used LCV market. As witnessed by a brief selection of top RV performers: “In the UK, the top three are the Ford Transit, Mercedes-Benz Sprinter and Renault Master. In Germany, they are the Fiat Ducato, Mercedes-Benz Sprinter and Renault Master. And in Spain, they are the Volkswagen Crafter, Mercedes-Benz Sprinter and the Ford Transit”, says Lövsund. RV OF EV LCVs In car remarketing, the reluctance to trade in alt-fuel cars is receding. And there is also a business case for remarketing LCVs with alternative motorisations, says Reinhold. But again, it all comes down to purpose. “Whether or not electric motorisations are useful, depends on where you are. In an urban environment, where it is likely that you need a range of no more than 60, 70 km per day, this could be of interest. But not if you need to cover a whole country. Even though I'm not a fan of electric, there are definitely cases where it makes sense for LCVs”.
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“There currently are very few green 3.5-tonne LCV models, and in low volumes. The Iveco Daily currently is the only one”, says Lövsund. “The penetration for smaller LCVs that could qualify as green, such as the Nissan eNV200, Renault Kangoo EV, Citroen Berlingo Electric, is also very small. But the business case for green LCVs will improve as more cities enact environmental restrictions on entering their urban centres, with changes in taxation and regulation on diesel emissions”.
50 %
UTILISATION COSTS FOR LCVs
CROSS-BORDER SELLING The actual selling of LCVs on the secondhand market follows the general pattern of used-car sales, with physical auctions rapidly being outpaced by online auctions. But there are some particularly interesting business options for selling used LCVs in the actual, physical world. “In Eastern Europe and Russia, you still see a lot of so-called 'legacy vehicles' on the roads: vans produced long ago by national manufacturers. This is a good market for quality secondhand LCVs that can be used by the legions of startup small businesses in the region”, says Reinhold. “But of course that business opportunity has to be weighed against the transport costs, which obviously are higher for LCVs”.
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NCR’s tips to improve LCV fleets Tim Harrup
From its origins as a cash-register company, NCR has grown into supplying an entire range of services to the retail industry, turning over in excess of six billion dollars worldwide. Commodity Manager and EMEA Fleet Manager Marina Ostojic gives us an insight into management the LCV fleet.
NCR Sector Services of activity Number of LCV’s
Approximately 1500
United Kingdom, Netherlands, Belgium, Poland, Switzerland, Countries Austria, Germany, Hungary, Czech Republic, Russia, Spain, Turkey, Italy, France Fleet Marina Ostojic manager Job title
EMEA Fleet Manager
NCR bases its LCV fleet policy on how many parts need to be carried, how heavy the parts are, etc. The number of vehicles is calculated according to an optimal ratio of customer engineers to vehicles, re-allocating these from personnel who leave the company, and by accounting for the expected number of future engineers. Price optimisation is achieved through consolidation of spend among fewer OEMs and by leveraging increased OEM volume and competition to drive better rates. There is a focus on refreshing the fleet at the correct times, and comparing the amortization of vehicles with actual use. SUPPLY-SIDE HELP With lease companies, NCR is reviewing different aspects of vehicle policies to
MARINA OSTOJIC GIVES HER TOP TIPS FOR LCV FLEET MANAGERS 1. Weight and dimensions: Any search should start with setting down what the vehicle is going to do, what it carries, how big the load is and how heavy. 2. Finance: decide how to pay for the vehicle.
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3. Image – companies should pay attention to what the van says about the company and its employees. 4. Reliability – keep a check on breakdowns and maintenance costs. 5. Monitor running costs and fuel consumption.
improve the fleet. This is done year on yearly basis (performance, CO2 emissions, fuel consumptions etc.) The OEM’s are helping with suggestions on economical cars/ LCV’s which can at the same time satisfy company needs. And they also provide discounts and bonuses. FIT-OUT The specific interior fit-out of NCR’s light commercial vehicles depends on specific requirements from country to country. In most cases NCR cooperates with OEM’s or their recommended partners. On the question of interior fit-out causing any issues at the remarketing stage, NCR avoids these problems by paying attention at the very beginning when ordering. DRIVER BEHAVIOUR Good driving behaviour is monitored through a driver league table which acts as an incentive, and company newsletters: some of the key results such as accidents damages are shared so individuals and groups can be recognised for their efforts. Drivers also have some say in the type of vehicle selected, by making comments about the safety, space and comfort of the LCV’s and their special needs. In most countries, drivers are used to test LCV’s, over approximately a 3-week period.
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ADVERTORIAL
CONCEDED EDITORIAL SPACE
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DOSSIER
Make the right choice Damien Malvetti
NISSAN NV300 Newcomer in the Nissan range, the NV300 sits between NV200 and NV400 and is assembled in the Renault plant in Sandouville. It is a clone of the Renault Trafic and Opel Vivaro. The NV300 replaces the Nissan Primastar, which was already a product of the alliance with Renault and whose production was stopped in 2014.
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As every two years, the Hannover IAA (September 22nd to 29th) will be the opportunity to show some new LCV models. Here are the main ones.
FIAT TALENTO Formely known as Scudo, the Fiat Talento is the result of the new alliance with Renault. It offers some additional equipment compared to the Renault Trafic, but for a higher price. The Talento can take up to 1.249 kg payload and up to 3.060 kg of maximum allowed weight.
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Nissan NV300
VOLKSWAGEN CRAFTER This is the most important LCV novelty expected at the show: the new Volkswagen Crafter. The German brand has not yet released official model pictures. A twin model under the MAN brand – called TGE – and the result of the collaboration between the two brands, is also expected to be on show.
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FORD TRANSIT AND TRANSIT CUSTOM EURO 6 The Ford Transit and Transit Custom expand their range of diesel engines with the arrival of a Euro 6 version. Available with 105, 130 and 170 hp, this new engine consumes 6.6l/100 km and emits 174 g/km CO2 on the Transit and 6.1l/100 km and 157 g/km on the Transit Custom.
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Fiat Talento
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4
Volkswagen Crafter
Ford Transit and Transit Custom Euro 6
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DOSSIER
IVECO DAILY EURO 6 Two years after its launch, the Iveco best seller also receives a Euro 6 engine. Available as 2.3 and 3.0 liters, this new engine develops 205 hp and torque of 470 Nm. Another novelty on the Daily is the arrival of an automatic 8-speed gearbox.
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IVECO DAILY BUSINESS UP 6 The Iveco Daily is the first commercial vehicle coupled to a smartphone application. Named Daily Business Up, it allows the driver to communicate directly with the vehicle engine via a Bluetooth connection. The aim is also to optimize driving, giving the driver an analysis of his behavior. FIAT FULLBACK 7 The Fullback is the first Fiat pick-up available on the European continent. Born of the alliance with Mitsubishi, this vehicle, available as 4-wheel drive, also offers a payload up to 1,100 kg and a towable weight up to 3100 kg.
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RENAULT ALASKAN Based on the Nissan Navara platform, the Alaskan is the first SUV produced by Renault. It includes all the technical elements of Navarra and will be produced on the same production lines in Barcelona and Cordoba.
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MERCEDES UPTIME Mercedes Uptime is a new automated and continuous monitoring service of the ‘health status‘ of trucks. This service allows maintenance to be anticipated and downtime to be minimised in cases of breakdown. It will be launched in 12 European countries but could be quickly adapted to commercial vehicles.
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EQUIPMENT FOR PEUGEOT EXPERT/ CITROEN JUMPY/TOYOTA PROACE A few months after they came to market, more equipment is now available for the trio of Peugeot Expert, Citroen Jumpy and Toyota Proace: sliding ladder, footboard, roof bars, etc. Many suppliers will offer solutions for all uses.
Fiat Fullback
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Renault Alaskan
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Mercedes Uptime Iveco Daily Euro 6
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Renault Alaskan
Iveco Daily Business Up
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JAGUAR XF AND JAGUAR XE
IT’S ALL ABOUT THE COMPANY YOU KEEP.
Don’t just expand your fleet, enhance it. In both the Jaguar XF or XE, you’ll find a driving experience like no other. While the Jaguar XF’s extraordinarily efficient Ingenium engines and the InControl Touch Pro infotainment system offer unrivalled dynamic driving and connectivity, the XE is Jaguar’s most innovative, efficient and dynamic sports sedan to date. Both models possess a state-of-the-art Lightweight Aluminium Architecture that contributes to some of the most fuel efficient Jaguars yet. Ask your local Jaguar Fleet & Business contact for our attractive leasing rates. jaguar.com/fleet-and-business
* JAGUAR CARE is valid for all new XE and new XF models in Austria, Belgium, France, Germany, Italy, Luxembourg, Netherlands, Portugal and Spain. Service pack contains all service-related labour and parts costs and does not include wear and tear. Local market exceptions may apply to the servicing offer. Official fuel consumption figures for the Jaguar XE/XF in l/100 km: Urban 11.9–3.4, Extra urban 6.7–3.4, Combined 8.6–3.8. CO2 emissions g/km: 204–99; vehicles displayed show optional equipment.
JAGUAR CARE
3-year unlimited mileage warranty, servicing*
LOWER EMISSIONS From 99 g/km CO2
HIGHER FUEL ECONOMY Up to 3.8 l/100 km combined
SMART MOBILITY
Smart Apps, easiest driving Antigoni Vokou @Antivokou
Our world is constantly evolving thanks to innovations in technology. Apps are one of the greatest mobility innovations so far. Just downloading an app can turn any smartphone into a mobility management device. With fleets increasingly connected, these apps are helping both drivers and fleet managers. Read on for a selection of smart apps that will help you park, reduce fleet costs, and get to your meeting safely and without traffic jams.
Today, thousands of apps are aimed at mobility and fleet drivers. Each day, new ones are added to the list. A recent study by CVO, the Corporate Vehicle Observatory, 2,993 fleet managers of all sizes fleets in the UK attest there’s a positive mood to adopt app tech and 71 % of businesses provide smart devices to their employees. The main reasons British fleet managers use apps: to improve driver behaviour (18 %), to receive car alerts (13 %), to have remote access to car data (12 %) and because they find it facilitates employee mobility (6 %). Parking, traffic avoidance and fuel station finder are the three main uses of apps for drivers. APP TO FIND A PARKING SPACE ParkMe covers 90,000 locations in 4,200 cities across 7 continents. It locates the cheapest daily and monthly parking rates at your destination, but also provides rates for on-street meters, if available. It allows you to see the occupancy, directs you to the nearest parking lot entrance and offers a timer to help you avoid a ticket. You can pay in advance to guarantee your parking spot.
ParkMe
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APPS BOOSTING FLEET EFFICIENCY TomTom’s Telematics WEBFLEET is a Software-as-a-Service (SaaS) solution. It gives fleet managers information such as: vehicle location, vehicle use, trends of the fleet’s KPIs on a dashboard, real-time traffic information for drivers, but also working hours, mileage and trip reports. Since June 2016 a new app integrates WEBFLEET with Salesforce. It makes it easier for sales employees to use the CRM system on the road and for sales forces to connect with customers and partners. MY ALD mobile app bundles the main features of the MY ALD portal, which offers outsourcing of the Fleet Management for drivers and fleet managers. The former access information like mileage, maintenance, alerts from the fleet manager, car policy. The latter can access a fleet overview. Fleet logistics mobile app FLI Mobility Control provides access to drivers, suppliers and vehicles. FCA’s Leasys Driver app provides fast and user-friendly access to Leasys services like tracking, maintenance centre localisation and rating, accident report and traffic fine notification. Automatic Fleet
TomTom’s WEBFLEET
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Automatic Fleet
provides fleet managers with the locations and driving patterns of their employees, with real-time GPS location tracking, so they know when maintenance is due and what the fleet cost is. First, you need to install the automatic car adapter (one per vehicle). It can save up to 30 % in fuel. APP FOR LESS CO2 SoFleet Mobile helps drivers become ecologically responsible by measuring daily the impact of their driving on the environment. It analyses mileage, fuel consumption and CO2 emissions. It provides eco-driving tips to help drivers improve their behaviour. LeasePlan’s app also aims to make mobility easier and greener as it tracks drivers’ average fuel consumption. Arval Active Link app gives drivers a detailed personalised follow-up of their activities on their smartphone to help them reduce their fuel consumption and thus their CO2 emissions. With Volkswagen Financial Services Charge&Fuel App, customers can see all available and nearest charging points and capacity, identify themselves at the charging stations of provider RWE. ParkMe also indicates the presence of electric vehicle (EV) charging stations. APP TO BE ON TIME Waze is a community-based traffic and navigation app. Drivers share road information in real-time to help each other save time and fuel every day. Alerts deal with accidents, police, and of course traffic jams. But also where to find the cheapest fuel stations near your destination. Alphabet’s AlphaGuide app includes a mobility calendar with real-time traffic information, search of POI and a feature telling users when they should leave if they want to arrive on time FLEET EUROPE #85
iOnRoad
at their appointment. Sixt Fastlane can save time. This new feature of the Sixt app allows customers to go directly to their selected car and open it with their smartphone. APPS INCREASING SAFETY EU research indicates that up to 90 % of road traffic incidents are due to human error. One of the most frequent causes is driving while using a smartphone. iOnRoad is helping drivers avoid accidents caused by distractions. It offers: driving information in real-time, collision warning and video recording following the black box principle. With its Text to Speech programme, you can listen to your phone’s text notifications while you stay focused on the road. DashDroid can block text messages and phone call notifications, turn off your code so you don’t have to type it, and inform via a pre-set message those who are contacting you that you’re driving. Another key function of this app is that it saves your battery by disabling your Wi-Fi and connecting your car automatically with the Activate by Bluetooth feature. Arval Active Link app and LeasePlan’s app also follow driver behavior to help decrease accidents rate. APPS FOR CAR SHARING RCI Mobility’s Glide car sharing app offers drivers ease of registration, booking the car and opening it with their mobile devices. Ahtlon’s Plan, Book & Go app also opens cars’ doors, it’s a car sharing solution with an online reservation tool combined with in-car technology. Mileage registration and billing is automated.
30 %
OF FUEL CAN BE SAVED WITH THE AUTOMATIC FLEET APP
90 %
OF ROAD INCIDENTS ARE ATTRIBUTED TO HUMAN ERROR
Note: Most of these applications are available for iPhone and Android. A subscription to the company’s service may be required to use the app.
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SMART MOBILITY
EU’s plan for lowCO2 mobility by 2030 Antigoni Vokou @Antivokou
Climate change is one of the biggest challenges the world is facing currently and its consequences could be dramatic for all the regions, including Europe. The European Commission’s objective is to move to low-CO2 mobility and transport with a new Climate Action plan. This transition must bring results by 2030. To attain them, the spotlight is on zero-emission vehicles and alternative lowemissions fuels.
CO2 is the enemy to eradicate in the EU Commission’s Climate Action plan presented on the 20th of July. A plan arriving right on time as early August the National Oceanic and Atmospheric Administration (NOAA) reports in “state of the climate” that 2015 was the worst climate year ever. Scientists from 62 countries confirm that heat, sea level rise and extreme weather broke records in 2015. But, what exactly do transport & mobility have to do with climate change? Road transport provokes ¼ of European Union’s greenhouse gas (GHG) emissions. These GHG emissions are due essentially to human activities and lead to Earth’s global warming. CO2 concentration in the atmosphere is 40 % higher than when industrialisation started. Thus, reducing GHG emissions for transport is key to diminishing global warming and respecting the United Nations Climate Change Paris Agreement, reached in December 2015. Less CO2 caused by transport will considerably “improve our life in cities” considers Violeta Bulc, EU Commissioner for Transport. “It is also an opportunity to modernise the EU's economy and keep Europe's industry competitive. The Strategy we adopted today presents a roadmap towards low-emission mobility and will give an impetus to that shift,” adds Violeta Bulc. The EU has set the most challenging targets worldwide for “fighting” vehicle CO2 emissions. By 2021 European car manufacturers have to reduce emissions to 95g of CO2 per kilometre for passenger cars and 147g for light commercial vehicles.
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ZERO EMISSION VEHICLES AND CLEAN FUELS The Commission’s strategy on low-CO2 emission mobility is aiming for the development of EU-wide measures on low and zero-emission vehicles and alternative low-emissions fuels. "We are setting our transport system firmly on the path towards zero-emissions,” confirms Maroš Šefčovič, Vice-President in charge of the Energy Union. To arrive at low-CO2 mobility and transport, the plan sets binding annual GHG emissions targets for Member States from 2021 to 2030 for the transport sector. Miguel Arias Cañete, EU Commissioner for Climate Action and Energy, said: "The EU has an ambitious emissions reduction target, one I am convinced we can achieve through the collective efforts of all Member States.” It’s up to Member States to evaluate how to implement the measures to reach the 2030 CO2 reduction target. Also, from 2016 and onwards, the Commission will ensure that at least 20 % of the EU’s budget is dedicated to climate change mitigation measures. Over 50 % of the investments approved up to today in the EU are climate related. The European Fund for Strategic Investments will put at least €315 billion in additional investment into the real economy by mid-2018. The European Commission has identified four priorities to reach low-CO2 mobility: 1. Zero-emission vehicles must increase by 2030: To encourage and accelerate this transition, further improvements
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to the internal combustion engine are necessary in Europe to make them eco-friendly; 2. Low-emission alternative energy for mobility & transport: the deployment of low-CO2 energy such as advanced biofuels, electricity, hydrogen and renewable synthetic fuels must be encouraged; 3. Increase the alternative fuels infrastructure: all obstacles to the electrification of transport and the move towards E-mobility must disappear. The EU’s charging network is currently being expanded via the Innovation and Networks Executive Agency (INEA), which manages the technical and financial implementation of the TEN-T programme. TEN-T contributes to the development of the charging infrastructure in order to boost the use of electric transport in Europe; 4. Increase the efficiency of transport and mobility by making the most of digital technologies, smart pricing and sustain the shift to low-emission transport modes. WIDER INFRASTRUCTURE NETWORK The European Automobile Manufacturers’ Association (ACEA) welcomed these new EU targets for transport and mobility by 2030. “The automobile industry is fully committed to continue reducing CO2 emissions across all business segments, from passenger cars to trucks,” said Erik Jonnaert, ACEA Secretary General. Nevertheless, the ACEA believes that the EU strategy focuses on new vehicle technology and not on other factors impacting CO2 emissions during the use of the such as fuels, faster fleet renewal, infrastructure or driver behavior. For Erik Jonnaert. “A wider roll-out of infrastructure for alternative fuel vehicles is needed to enable a stronger market uptake of zeroor low-emissions vehicles by 2030.”
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FULFIL THE OBJECTIVES For the younger generations of employees greener EU roads in the next decade is a key challenge. Goodyear’s ThinkGoodMobility study shows 59.3 % of millennials (18-30 years old) asked (2,564 in total) believe car makers should focus on the creation of a sustainable car. CO2 emissions standards need to be strictly regulated for 44.6 % of them and 35.7 % would like incentives for use of fuel-efficient vehicles. As transport accounts for 25 % of Europe's GHG emissions move to low-CO2 emission mobility is crucial to fight climate objectives. In the long term, GHG emissions from transport must be reduced by 60 % below 1990 levels by 2050. In the short term, the most successful solution to stop CO2 emissions in the car industry is, in the eyes of the EU Commission: boost alternative fuel sales and improve fuel efficiency for petrol and diesel engines. The more hybrid and EVs multiply on EU’s roads, the better “climate health” will be. Mitigate these CO2 emissions to stop global warming is essential, in order to avoid that the Earth’s temperature rises beyond 2°C in the future, when compared with the temperature of the pre-industrial era. As the NOAA’s report attests, a rising temperature will only create worse meteorological phenomena in regions which have escaped them so far, such as Europe.
40 %
CUTS IN EU GHG EMISSIONS NECESSARY BY 2030
64 %
OF GLOBAL WARMING IS MAN-MADE
95 g of CO
2 MAXIMUM EMISSIONS FOR CARS BY 2021 IN EU
147 g of CO
2
MAXIMUM EMISSIONS FOR LCVs BY 2021 IN EU
0.85° C: global average temperature increase since records began in 1850.
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BUSINESS
Conquering connected SMEs Dieter Quartier @ DieterQuartier
Toyota has decided to take the LCV segment more seriously. It plans to achieve a 3 % market share in the European LCV segment (including Russia) – a goal it wants to achieve by 2018.
This means it needs to push its sales numbers by 50 %. A key role is to be played by its brand new Proace (van) and Proace Verso (family to VIP MPV), with which the brand pushes the envelope in terms of connectivity. Last April, Toyota created a dedicated LCV business unit, the mission of which is to coordinate the brand’s global commercial vehicle activities. But there is more to the
company’s strategy. “We are strengthening our European Business Centre network with new LCV specific standards in sales and after sales, and developing a range of flexible finance options including full service lease”, explains Dave Cussell, General Manager Fleet, Leasing & Network at Toyota Motor Europe. “Product-wise, we count on our new Hilux pick-up and of course the brand new Proace to conquest and retain customers, which will be mainly SMEs.”
BUSINESS
FRENCH CONNECTION For productivity reasons the Proace is built in France in partnership with PSA. The new Proace will be available with two wheelbases, three body lengths and either a 1.6 or a 2.0 HDi diesel with attractive fuel efficiency and CO2 emissions. Depending on the customer’s needs, the Proace can be a basic van for heavy duty usage all the way up to a VIP vehicle with top notch amenities. What sets it apart from its competitors – the Ford Transit Custom, Mercedes Vito, Opel Vivaro and Volkswagen Transporter, for instance? “First of all, there is our 3 year/150,000 km warranty. Secondly, the Proace is equipped with what we call Toyota Safety Sense, a suite of advanced active safety features. Last but not least, together with Proace Toyota introduces an integrated telematics solution for fleet operators: ProBusiness Telematics”, says Dave Cussell. This optional service consists of vehicle data being transmitted in real time to a secure data hub, including vehicle location,
The new Proace will be available with two wheelbases, three body lengths.
mileage, fuel economy, speed and warning notification. The data is available via a bespoke, user friendly Toyota portal (accessible on PC, tablet or smart phone) or as raw data to existing fleet management solutions. “ProBusiness Telematics allows fleet managers to track vehicle movements and thereby improve customer service levels, monitor driving styles to improve fuel efficiency and reduce accident risk, and plan maintenance based on accurate mileage avoiding unplanned downtime and minimising costs”, Dave Cussell concludes. France is the first country in which the telematics solution is rolled oud, with the rest of Europe following in 2017.
Dave Cussell, General Manager Fleet, Leasing & Network at Toyota Motor Europe: “Together with Proace we introduce an integrated telematics solution for fleets: ProBusiness Telematics.”
BUSINESS
Targeting 70,000 LCV sales in Europe Jonathan Manning
Robert Lujan took over as Nissan Europe’s General Manager of Light Commercial Vehicles in June. He has worked for the manufacturer for nine years, including managing director of Nissan Netherlands, and most recently in Japan, working on global sales and marketing of electric vehicles.
How is Nissan performing in the LCV sector this year?
How does Nissan Europe support its LCV business?
ROBERT LUJAN We have outperformed our expectations, in terms of both volume and market share. We have aspirations to sell 70,000+ units for the fiscal year from April to March, and everything is pointing in the direction that our aspirations are not only attainable, but that there is potentially some upside as we look at the TIV [Total Industry Volume] growth we have seen in the early part of the year.
R.L. We have teams within countries and here at headquarters to facilitate the business, working with key accounts and dealers to push performance. Within Nissan Europe we have strengthened the team to support product development, marketing, sales, and business development as well as conversions and different sales channels.
We are expecting a lot from our new NV300 which will go on sale from November. NV300 is our new mid-size van and replacement for the previous Primastar. It comes in Panel Van, Crew Van and Combi formats. We will have one of the widest LCV ranges on the market – covering an electric van, a pickup and light truck models.
What is driving Nissan’s LCV sales growth? R.L. Having a product that has been as well received as the all-new Navara has had a very positive impact on our business. Our OEM five-year warranty really differentiates us, and customers are showing a very positive reaction to Nissan, based on our willingness to stand behind our product and improve their ease of ownership.
Conversion business is one area where Robert Lujan, General Manager LCV for Nissan Europe, sees business potential.
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Beyond that, we have been very successful in having our dealers invest in LCV in both resource to support the business, and also marketing to drive traffic and awareness. We have just under 2,000 dealers in our European business, and the network is far and away our number one activity.
In some countries we have business centres that specialise in dealing with SMEs, B2B, leasing companies, as well as our LCV customers. We ask those dealers to reach an even higher standard, with support from Nissan, to grow the business.
Where do future LCV opportunities lie for Nissan? R.L. One example would be conversions. Although we have a fairly robust business, in terms of a Nissan-branded conversion that’s done in-house and is covered by the warranty, beyond that is a type four conversion, dealing with partners to ensure we cover the needs of customers. That is somewhere we are putting more resource, to capture customers who are already buying vehicles from us, so that we can expand the breadth of our offering. Another area that will be important is the connected vehicle and telematics, providing the customer with the added value for fuel cost reduction, accident reduction, and insurance fee reduction. Finally, the alternative powertrain ENV200 has been very well received in Europe. Where there are restrictions in terms of emissions, for cities like London, we have customers reaching out to us, and the adoption rate is moving in a positive direction. FLEET EUROPE #85
BUSINESS
Never lose sight of the big picture Steven Schoefs @StevenSchoefs
Mercedes-Benz just announced the building of a new Sprinter LCV plant in South Carolina to serve clients in the United States better and more direct. The ambitions across the Atlantic go hand in hand with those in Europe, where the Mercedes Sprinter is currently the best selling LCV in fleets, looking at the figures from Dataforce (see also pages 6-8).
Michael Pflüger heads MercedesBenz Vans’ international sales.
“The success of Mercedes-Benz Vans speaks for a high level customer satisfaction which can also be attributed to our role as an innovation driver”, says Michael Pflüger, Head of International Key Account Management at MercedesBenz Vans. How Mercedes-Benz sees innovation in LCV development can be discovered at the International Motor Show (IAA) in Hanover, Germany, at the end of September. “In line with the motto “driven by ideas” you will gain insights into the world of our innovative, modern and digitally connected
For three years now the entire engine range - available for Mercedes Sprinter in Europe - has complied with the Euro VI emissions standard. Here Mercedes Sprinter, Vito and Citan.
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commercial vehicles. Mercedes-Benz Vans will offer a look ahead at forthcoming new services and hardware solutions for your fleets as well. Amongst other innovations you will see how connectivity can be used and how it significantly increases the availability of our vehicles.”
What should be mentioned in terms of the development of safety equipment? MICHAEL PFLÜGER “Safety is of great importance. For us, it covers the whole range from driver-fitness safety by way of outstanding ergonomics, to car-like handling performance and passive Safety. I think the focus should be on accident prevention – this topic is becoming more and more important, even for big fleets. The spectrum of this safety technology ranges from Crosswind Assist to Collision Prevention Assist, Blind Spot Assist, Lane Keeping Assist and High Beam Assist.”
What is your main tip for international fleet managers in terms of optimizing the TCO of their LCV fleet? M.P. “Always keep the big picture in mind. Analyze your fleet and mobility needs to gain a better understanding of the cost components of your fleet. Ultimately, is it also a question of sustainability. Sustainability is a result of product dependability as well as a reliable and competent service network of the OEM. As an OEM we are able to support a decrease of TCO for an LCV fleet with reliable residual values, less downtime, prolonged maintenance intervals, low maintenance costs and reduced fuel consumption.”
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BUSINESS
Our goal is to grow with Athlon Frank Jacobs & Steven Schoefs @FrankJacobs - @StevenSchoefs
The acquisition of Athlon International by Daimler Financial Services is the biggest fleet and lease industry news story of the summer. Fleet Europe put some questions on the deal to Gero Goetzenberger, CEO of Daimler Fleet Management.
The biggest news story of the summer? Perhaps of the whole year. The deal, which is worth €1.1 billion, is subject to approval by the relevant authorities and should be completed by the end of the year. For our earlier in-depth reporting on the deal, see our news stories on the Fleet Europe website www.fleeteurope.com. CORE FACTS On 1 July, Fleet Europe reported that Netherlands-based multibrand lease company Athlon International had been acquired by Mercedes-Benz Financial Services Nederland, a subsidiary of Daimler Financial Services. In Europe, Athlon International operates 250,000 vehicles across 11 markets. Through global partnerships, the lease company has a presence in 22 countries, and is involved in managing around 800,000 vehicles worldwide. Daimler Financial Services is a subsidiary of Daimler, parent of Mercedes-Benz. Daimler Financial Services provides financial services in over 40 countries and manages a fleet of more than 3.7 million vehicles. It entails Daimler Fleet Management, which focuses on vehicle fleet services and operates in 13 countries managing 85,000 vehicles. The operations of Athlon International and Daimler Fleet Management will be consolidated under the Athlon brand name.
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Netherlands-based Athlon was sold by its Dutch parent company DLL (De Lage Landen), a global provider of leasing and financing solutions that in turn is owned by Rabobank – a global leader in agricultural financing. As a consequence of stricter banking regulations following the 2008 crisis, DLL/Rabobank like other financial institutions now is subject to stricter rules on capital flow. That has made it less attractive for the parent company to engage in automotive leasing, which is especially capital-intensive. From Daimler’s perspective as well, the acquisition makes business sense. The German fleet leasing market is dominated by captive lessors such as Volkswagen Leasing, Alphabet (BMW) and Daimler Fleet Leasing (Mercedes-Benz), for all of whom it makes strategic sense to capture as much as possible of the multibrand lease market. The ultimate goal is to provide these multibrand customers with solutions that involve them with the captive lessor's manufacturing parent. Both Athlon International and Daimler Financial Services have affirmed that the deal, which should be completed by the end of this year, will not affect either of their current partner relationships, but confirm their belief in its growth potential. For Athlon International, which is focusing on the transition from fleet management to mobility management, it provides a platform to take the development of new concepts and new market segments to the next level.
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BUSINESS
FRANS JANSSEN, ATHLON INTERNATIONAL In an interview with Fleet Europe, Frans Janssen, President of Athlon International, provided some perspective on how this deal will benefit his company: “Daimler shares our ambitions to innovate and grow. The mobility market finds itself in a crucial phase. Traditional solutions make room for fundamentally new concepts. That opens up possibilities, however, it also requires that we are able to quickly take substantial steps forward. With our new shareholder, Daimler Financial Services, we are able to do so”. “Additionally, it will lead to growth of our global footprint. Athlon and Daimler
GERO GOETZENBERGER, DAIMLER FLEET MANAGEMENT For Daimler, the deal marks the transition from a captive leasing strategy to a multibrand one. The company sees fleet management as a growth market, and the acquisition of this stronglypositioned and innovative fleet management company as a key step for towards becoming a leading fleet management services provider. But for the inquisitive observer, some questions remain. Such as: Why was Athlon acquired by Daimler’s Dutch subsidiary and not by HQ in Germany? “Since Athlon International B.V. is registered in the Netherlands, it was the best solution for us to acquire Athlon via our Dutch subsidiary Mercedes-Benz Financial Services Nederland, which is assigned to the business unit Daimler Financial Services AG”, says Gero Goetzenberger, CEO of Daimler Fleet Management.
What is your strategy behind keeping the Athlon brand? “Our overall goal is to bundle the business under the Athlon brand as an all makes brand, and thus focus on the non-captive business as an independent provider”.
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Fleet Management will operate under the Athlon brand name, so Athlon will remain a multi-make brand with a new, strong and innovative shareholder. Daimler Fleet Management is clearly aiming for growth, and this will set us in a new direction. We’re looking forward to this new venture”. Growth is clearly a priority, but there is more, Frans Janssen says: “Thinking and strategising around the new mobility landscape will be as important as just scale. The combination of Athlon and Daimler Fleet Management will also strengthen our position in the field of global mobility solutions”.
Frans Janssen, President of Athlon International
Will Athlon's current partnerships with Lex, Donlen, FleetCorp and others continue, or will they come to an end in the new business configuration? “Athlon International and its current partners will discuss future opportunities. The clear intention is to continue current relationships, which are an important part of the International Sales channel”.
Who will have the lead in management and executive decisions – Athlon or Daimler?
Gero Goetzenberger, CEO of Daimler Fleet Management.
“When the deal is closed, Athlon will be 100 % owned by Daimler. Our goal is to grow, and it is towards that goal that we, jointly with Athlon, will look at current and future structures”.
Will it not be difficult for the new structure to maintain multibrand neutrality? “Acquiring Athlon International and using its brand name is a consequent step in Daimler Financial Services’ expansion strategy to become an all makes international fleet provider. We do not expect any negative impact on Athlon's neutral, multibrand image”.
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BUSINESS
SWEDEN
GEOGRAPHIC MAP INDICATING THE COUNTRIES WHERE DAIMLER FINANCIAL SERVICES AND ATHLON ARE PRESENT
DENMARK
RUSSIA
IRELAND UK NETHERLANDS
POLAND GERMANY
BELGIUM LUX
ATHLON IS ALSO PRESENT IN CANADA AND USA
CZECH REPUBLIC SLOVAKIA AUSTRIA
SWITZERLAND FRANCE
HUNGARY
CROATIA
ROMANIA
ITALY
COUNTRIES WHERE ATHLON IS PRESENT
PORTUGAL
SPAIN
COUNTRIES WHERE DAIMLER FINANCIAL SERVICES ARE PRESENT
TURKEY
COUNTRIES WHERE THEY ARE BOTH PRESENT
IN A NUTSHELL: DAIMLER FINANCIAL SERVICES • Daimler FS provides financial services in over 40 countries and manages a fleet of more than 3.7 million vehicles. • 1 967: Daimler's earliest foray into leasing
ATHLON INTERNATIONAL • Athlon is the established market leader in vehicle leasing in the Netherlands, as well as a global vehicle leasing and mobility solutions provider. • 1916: Establishment of Riva (Repair Station for Automobiles) in the Netherlands • 1 950: First car leasing activities in the Netherlands • 1 973: Establishment of Interleasing Nederland in Amsterdam
• 1 979: Founding of MercedesBenz Leasing GmbH
• 1 990: Launch of car body repair centre CARe Schadeservice and full-ownership of Interleasing in Belgium
• 1 982: Launch U.S. subsidiary of Mercedes-Benz Leasing GmbH
• 1 991: Official name change from Riva NV to Athlon Groep NV
• 1987: Spin off into MercedesBenz Finanz GmbH • 1 990: Daimler-Benz InterServices AG (debis) is founded • 1 998: The company becomes DaimlerChrysler Services AG • 1 999: DaimlerChrysler Services AG is fourth-largest provider of financial services outside banking and insurance sector •2 000: Present in 34 countries •2 005: Entering the market in China •2 007: With split Daimler and Chrysler, company is renamed Daimler Financial Services • 2010: Expansion mobility services business by assuming responsibility for car2go and founding moovel GmbH. 46
• 1 997: Acquisition of French lease company G.G. Jean Jaurès and German rental company C.C. Raule • 1 998: Acquisition of AV Leasing in Germany • 1 999: Acquisition of share capital in Hiltermann Lease Service and lease company Atop Deutschland, and acquisition of SDL, Selmat and CB Location in France •2 001: Lease fleet exceeds 100,000 cars •2 003: Merger into one lease company per country, and introduction Athlon Car Lease / Athlon Holding •2 006: Acquisition of Business Renting in Spain, and take-over by De Lage Landen •2 016: Athlon manages more than 250,000 vehicles across 11 countries: the Benelux, Germany, France, Italy, Poland, Portugal, Spain, Sweden and Switzerland. •2 016: Via partnerships around the world, Athlon has a presence in 22 countries and is involved in managing a total of around 800,000 vehicles globally. •2 017: Much of Athlon's growth occurred over the last decade, with recent expansions into Portugal, Poland and Sweden and, the start of 2016, Switzerland. Athlon's future expansion plans are to open in four more markets by 2017. Athlon makes no secret of its interest to open up in Denmark and/or Norway.
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THE OPEL COMMERCIAL VEHICLES
MORE LOADING. LESS COST. With up to 2,100 kg loading capacity.
Fuel consumption urban 11.1–3.7 l/100 km, extra-urban 9.1–3.0 l/100 km, combined 9.7–3.3 l/100 km; CO2 emissions combined 257–87 g/km (according to R (EC) No. 715/2007).
BUSINESS
Most software is from the stone-age Steven Schoefs @StevenSchoefs
ARI is often still considered to be the new kid on the block despite their entrance into the European market nearly five years ago. Majk Strika, Managing Director, ARI Europe, on the future of the unbundled fleet management model in Europe. MAJK STRIKA We entered the UK market nearly five years ago and the European market nearly three years ago. In both markets combined, we will grow our managed portfolio by almost 20, 000 units both this year and next year. Our initial goal was to have an unbundled fleet management model supported by finance lease capabilities ready by 2018 in all of the major Western European economies. We are on track in our planning to be able to provide all the products and solutions we already supply in the US and the UK in Europe according to our initial goal.
We’ve recently been approved by BaFin to go to market with a finance lease product in Germany, but we are not going to get into the closed-end operational leasing business. We plan to target Benelux and France before the end of 2016, with Spain and Italy to follow in 2017. We are already operating to some degree in some of these countries, but we plan to expand our offerings and available services in these countries. Our main goal is to focus on companies who are interested in proactive, data driven, transparent fleet management solutions. With more than 100,000 units in our portfolio when you combine our UK and continental European operations, I think I can say that there is an appetite for our approach to fleet management.
Tell us more about the importance of IT. M.S. Technology is absolutely critical when it comes to modern fleet management. At ARI we invest 25% of our operating budget, year after year, into technology and information systems. I don’t think any of our other competitors can make that claim.
Majk Strika, Managing Director ARI Europe: “I’m not sure that “mobility” is much more than a buzz word at the moment. Being a competitor to an airline or train ticket provider is currently not part of our plan.”
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At ARI, we’re not just interested in data for data’s sake, however; we want to be able to dive into what the data is telling us so we can offer our clients predictive solutions. In terms of technology no other fleet management company can even come close to our capabilities.
Isn’t close-end leasing as risk outsourcing solution the best solution in difficult economic times? M.S. I can tell you this is nothing but simple marketing. Closed-end full service leasing is like selling a life insurance to an immortal man for 100,000€, and telling him there will be a pay-out of 80,000€ when he passes away. Everyone knows he is getting the losing end of that deal. During the 2009 crisis, the company I was with at the time – like most others – was looking at a potential loss of perhaps 2,500€ per car. And customers were told that if they had bought the cars, this loss would have been theirs alone. So the lease companies worked with their clients, sometimes extending the lease period for example, and reduced their own losses significantly. The consequence of those changes, however, were price increases in every new contract going forward by 50€ or 100€ per month. ARI gives clients full visibility into their TCO and offers them flexibility on the contract setup. Our clients do not have to pay hidden margins, or inflated lease rates through conservative RVs. Truthfully, we have found that clients that dare to follow that route are surprised how easy it is to save money.
Is unbundling only of interest to very big fleets, because they are the only ones which can take advantage of the benefits? M.S. In North America, around 95 percent of the lease contracts are finance leasing – in other words unbundled. I would like to see the leasing companies in Europe working totally transparently in terms of finance leasing as well; but these companies are under great pressure from the banks to produce 20% returns, and this can’t be done with transparent finance leasing. FLEET EUROPE #85
INNOVATION
Telematics with a tantalising ROI Dieter Quartier @DieterQuartier
Telematics in LCV fleets can be a solution in optimising cost control, driver behaviour and safety. Bottom line: monitoring saves you money. Here’s how – and what’s new on the market.
38 TO 80 % LESS ACCIDENTS THANKS TO TELEMATICS
12 % FUEL SAVINGS ON AVERAGE
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The benefits of a realtime system that monitors your vehicles in terms of speed, acceleration, location, shift behaviour, idling time, etcetera, hardly need explaining. Still, digging a bit deeper reveals mechanisms that yield more than you might expect, especially in combination with strong analytics to filter and convert raw data into clear dashboard indicators and to pinpoint anomalies. We asked various tech providers to take us through the fascinating telematics story from a fleet manager’s point of view, taking a closer look on how things have evolved and answering the question every number cruncher asks: what about the return on investment? Finally, we focus on four interesting new products in the industry and how they take telematics to the next level.
insurance plans that properly reflect their usage and risk. Also, if you monitor driving behaviour, you can avoid aggressive acceleration and braking, improper gear change, excessive tyre and clutch use, etcetera.” It is even possible to predict technical problems before they occur: “We have an accurate algorithm to monitor battery health and can provide fleet managers with a whole range of fault codes before they develop into more costly problems with lengthier repair times”, says John Watkins, Executive Chairman of Trakm8 Group.
HOW IT MAKES YOU A COST-SAVER There are a number of cost-saving advantages that can be gained from installing telematics in your vehicle fleet. “Knowing in real time where your vehicles are means more efficient planning, increasing their productivity and making optimum use of resources”, says Jean-Philippe Labat, VP International Operations at Mapping Control. “Also, by following up on the vehicle, you get an accurate view on both the actual usage and the real running costs of the vehicle, resulting in tax and TCO savings”.
HOW IT MAKES YOU A LIFE-SAVER Telematics data can play an important role in driver safety. In other words, data gathering and analytics can be as vital in terms of protecting your drivers – and assets – as the active and passive safety systems of their vehicles. “We have seen over many years that fatal incidents can be prevented and the number of minor incidents reduced drastically”, highlights Jonathan Bates, Marketing Director Europe & North Africa at MiX Telematics. “Improving driver behaviour is key, together with providing visibility and subsequent change to the vehicle fleet composition and utilization, plus implementing new technology like in-vehicle camera solutions and fatigue warning systems that actively and tangibly reduce incidents literally in front of your eyes.”
Fabio Saiu, Head of Large Renting Channel and Fleet Management Services at Octo Telematics, highlights another cost-saving aspect: “By providing accurate and up-todate driver and vehicle data, companies can receive tailored ‘pay-how-you-drive’
According to John Watkins, a statistic from the Royal Society for the Prevention of Accidents (RoSPA) last year suggested that businesses that had introduced driver behaviour monitoring had reduced accident rates by between 38 % and 80 %.
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INNOVATION
Not only is Telematics becoming increasingly more affordable it is also delivering increasingly more benefits for vehicle fleet managers.
“This figure not only speaks volumes for the effect driver behaviour can have on safety, but also mitigates the costs surrounding wear and tear and vehicle downtime”.
TIPS & TRICKS “Getting drivers engaged in a process of continuous improvement boosts accountability and delivers tangible business benefits.” Marc Trollet, MiX Telematics Europe Managing Director. “Telematics allows you to reveal anomalies immediately and spend more time managing than data collecting.” Jean-Philippe Labat, VP International Operations at Mapping Control. “Footage from dash cams and multi-cam systems combined with the rich data derived from telematics devices provide a detailed overview of events in an easy-to-interpret manner.” John Watkins, Executive Chairman of Trakm8 Group.
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Fabio Saiu underlines that data analysis can help prevent an accident from repeating itself: “For instance, should data show that the majority of drivers have accidents after being on the road for more than two hours, introducing policies around how long people can drive before a break may help prevent accidents from happening.” FROM BLACK BOX TO ORACLE Telematics have come a long way: from track & trace devices or incident recorders, systems have evolved into powerful costsaving and efficiency boosting tools. Today, we are able to take data in real-time and apply it to situations that are currently taking place. Fabio Saiu explains: “If you know where your vehicles are, you can predict journey times and delivery slots. If a delivery driver is well-ahead of schedule then companies can change routes to allow the driver to carry out more deliveries that day”. “Telematics is nothing without analytics”, insists Jean-Philippe Labat. “You need a powerful computing tool to put all data into meaningful information. It is this data processing aspect that has evolved conside-
rably. At the same time, individual solutions have been integrated, allowing for a better vehicle management – and vehicle sharing amongst employees, for instance. Also, this evolution allows the aggregation of information from all the fleets you manage.” WORTH THE INVESTMENT? Telematics technology is becoming increasingly more affordable with the cost of hardware and communications plummeting. “Installation costs are also falling due to the introduction of self-fit devices such as our innovative T10 Micro unit which can be installed in under ten minutes”, John Watkins says. “With fuel savings of up to 15 % in mind, the falling cost of installation and hardware means that return on investment for telematics is constantly getting higher.” According to Jean-Philippe Labat, “the return can be 8 to 10 times the investment, including set-up and monthly fees. Thanks to telematics, a fleet manager evolves from a data collector to a true manager.” Jonathan Bates is on the same page: “Pure telematics is about data, Telematics 2.0 is about taking it to the next level – actionable intelligence that puts a client in the driving seat when it comes to understanding exactly what needs to be improved, with a route to get there.” FLEET EUROPE #85
INNOVATION
TELEMATICS INNOVATORS OCTO TELEMATICS Founded in 2002 as a provider of telematics to the motor insurance industry, Octo Telematics is currently focusing on vehicle diagnostics, which allow for the interception of anomalies, and on a more advanced platform 2.0, which will further facilitate the control of the efficiency of the vehicle, especially with a view to preventing technical
faults and delays. Much attention also goes to the verticalisation of the App for the global fleet industry, which collects, analyses and stores data on telematics driving behaviour and is a valuable learning tool, alerting motorists to recurrent hazards and improving road safety in general.
MAPPING CONTROL The latest product of Mapping Control, the Aix-en-Provence based integrated telematics provider, is called Optimum Automotive. Dubbed “Fleet Management 3.0”, it allows companies which do not have sufficient HR and software to drive down costs, from the set-up of the car policy all the way to the
TRAKM8 One of the most recent developments at Trakm8, a UK based company, is the integration of Route Monkey’s algorithms into their tracking portal. This provides customers with route optimisation, journey download, schedule monitoring, tracking, driver behaviour and an ePOD (electronic proof of delivery) system. The new appbased logistics solution allows fleet
managers to input their requirements into SWIFT, Trakm8’s tracking portal. This includes delivery addresses, vehicle types and capacity, and customerspecified delivery windows. The system calculates the best way to fulfil the day’s tasks by using the least number of vehicles, while also achieving the lowest cumulative mileage and the most fuelefficient route for each driver.
MIX TELEMATICS MiX Telematics, which was founded in 1996 in South Africa, is currently developing a brand new solution offering cuttingedge CANclip technology, delivering the most comprehensive vehicle information available, together with an in-vehicle driver interface device, allowing privacy management taking, private/business mileage recording, driver behaviour live feedback and reporting. This
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renewal of the fleet. Rationalising vehicle choice, optimising the vehicle cycle, automating and standardising the tender process: these are just a few of the features which allow you to streamline workflows and control costs and ensure compliance.
solution allows tax and expense management, privacy compliance, whilst still delivering telematics value, comprehensive LCV vehicle performance information and driver behaviour improvement, all leading to TCO reduction, improved safety and efficiency as well as local tax mileage compliance.
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REMARKETING
Diesel RVs will remain attractive Frank Jacobs @FrankJacobs
Europe's rapidly declining appetite for new diesel cars it threatening to cause a massive imbalance on the usedcar market. Belgian automotive association VAB urged its government to subsidise the adoption of petrol cars by corporate fleets as the quickest way to avert disaster. That risk is real across Europe, but limited in scope, says Dean Bowkett: “Used diesels will be less attractive, yet they retain their advantages”. Dieselgate, and the (not entirely unconnected) surge of taxation on diesel engines are rapidly weaning consumers off Europe's favourite fuel. The change is massive, but not unprecedented. Ironically, it mirrors the great move towards diesel, initiated about a decade and a half ago, says Bowkett (Bowkett Auto Consulting). DIESEL INCREASE “In 2001, 62.6 % of new car registrations in Belgium were diesels. By 2011, that share had increased to 75.3 %. In France, the increase went from 56.2 % in 2001 to 72.9 % in 2012”, says Bowkett. “Even in countries where diesel is far less dominant, we see the same evolution. Take Germany, for instance: the share of diesels increased from 34.5 % in 2001 to 48.1 % in 2012. Or even the UK, which saw the share of diesel cars increase from 17.8 % in 2001 to 50.8 % in 2012. In Italy, diesel went up from 36.6 % in 2001 to 53.1 % in 2012. In Spain, the diesel share increased from 52.5 % to 68.9 % over the same period”. The move towards diesel was encouraged by Europe's governments via fiscal stimuli,
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says Bowkett: “Diesel was taxed less than petrol, company car taxation favoured the diesel motorisation, and vehicle taxes were based on CO2 emissions – which penalised petrol, while leaving diesel alone”. 10 % DECLINE Concern about pollution, in particular CO2, emitted by petrol but not by diesel engines, was the main driver behind diesel's preferential treatment. “But the realisation that NOx, emitted by diesels, is harmful as well, was instrumental in reversing the prodiesel tendency”, says Bowkett. As a result, the fiscal promotion of diesel has been falling, as is diesel's share of new car registrations: “In France in 2014, diesel represented only 63.9 % of new car sales (down from almost 73 % a year earlier – ed.), and that share has been falling ever since. A similar decline is noticeable across Europe”. Belgium saw a decline by more than 10 % in just two years, to 64.8 % in 2013. That decline predates Dieselgate, but has only been accelerated by it. But there is another factor, a lingering effect of the economic crisis, and its emphasis on downsizing: “People who are choosing smaller cars, are less likely to opt for a diesel, because that makes less economic sense. For instance, in 2014, 68 % of large cars in Europe were diesels, while only 23 % of smaller cars such as the Fiesta and Ka were equipped with a diesel engine”. 32,200 MILEAGE “Company cars are a bit of an exception: here the preference is still clearly for diesel, as company cars are likely to do more FLEET EUROPE #85
REMARKETING
mileage. In the UK, for example, the average private car will do 12,000 miles (19,300 km) per annum, while a company car will rack up 20,000 miles (32,200 km) on average every year”. And this is the crux of the remarketing problem signalled by VAB in Belgium. Ex-lease cars are the main source for used vehicles. But as professional fleets stick to diesel in greater numbers than the rest of the market, the risk of imbalance on Europe's second-hand markets is immediate and severe. Looking at its own second-hand car scheme, VAB reports that 62 % of vehicles sold last year were small petrol-based cars. In the first half of 2016, that has gone up to 71 %. As a result of that increased demand, there now is an acute shortage of highquality, economical second-hand petrol cars. That imbalance could lead to a radical drop in the prices of second-hand diesels, and a corresponding surge in prices of second-hand petrol cars – which would be increasingly difficult to find, let alone afford. 8 % MORE EXPENSIVE The situation could get even more out of kilter. A recent survey indicates that even though 59 % of Belgian private motorists currently own a diesel car, only 16 % would definitely opt for a diesel in future – a drop representing 43 % of the total number of motorists. Fiscal anti-diesel measures (which do not apply to corporate mobility) would push 3 out of 4 private diesel drivers towards petrol. VAB suggests increasing the share of petrol cars in corporate fleets as the quickest way to fix the imbalance, as lease vehicles are replaced every four years on average – much faster than private vehicles. However, as corporate vehicle tax in Belgium is based on CO2 emissions, that would require a radical overhaul of fiscal policy. That is something Dean Bowkett is in favour of, though probably not in the way that VAB envisions: “Governments need to harmonise fuel tax, favouring neither petrol nor diesel. At present, petrol is on average 8 % more expensive in the Big Five markets – except in the UK, where the situation is reversed. Tax based solely on CO2 will have FLEET EUROPE #85
Diesel will not disappear, but it has to find a place on the car sales market in accordance with its true value.
to disappear. NOX will have to be brought in to account as well. Governments should establish a level playing field. Cars are expensive enough already, not just for private buyers, but also for companies”. 40 % MORE TORQUE As for diesel residual values (RVs), Bowkett says they will have to come down under pressure from the market. “The premium people are willing to pay for diesel has been eroding for some time now. There are still differences, based on different national taxes. In Belgium, for example, people are still prepared to pay 25 % more for a diesel over a comparable petrol vehicle. In the Netherlands, that difference is virtually zero. The difference? Tax”. So, as the second-hand market adjusts to the shifting preference for petrol, a certain amount of disruption seems inevitable – but that in itself is no different from the changes wrought by the onset of diesel itself, over the past decade and a half. The important thing to keep in mind is that diesel will not disappear, but find a place on the market in accordance with its true value. “Bereft of its fiscal advantages, diesel has less advantages to the buyer, but even if they are less attractive, they still retain a certain advantage”. There is the cumulative advantage over larger distances, for example. “And let's not forget that diesel has 40 % more torque than a comparable petrol engine”.
43 %
DECREASE OF BELGIAN PRIVATE MOTORISTS OPTING FOR DIESEL IN FUTURE
23 %
OF SMALL CARS IN EUROPE ARE DIESEL IN 2014.
UP TO
30 %
INCREASE OF DIESEL SALES IN EUROPE FROM 2001-2012.
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EXPERT
Brexit can create new fleet opportunities
Professor Peter N C Cooke
At its simplest, Brexit means the UK changes its relationship with its biggest single trading partner. More cohabiting than divorce with a partner with whom it has always had an uneasy relationship. Both parties, the UK and the 27 remaining members of the EU want, need, to continue trading with each. But on what terms? Nobody knows the new terms, when they will come into force whether they will be introduced gradually or in a single flash. Kafka would be proud of the British electorate voting to leave the European Union. They have never been told the whole truth or what Brexit might mean for them, their fleets and their employment. In the meantime, the UK stock market dropped sharply but is recovering slowly, sterling has suffered by 10 % so exports are cheaper, imports more expensive and buying British businesses cheaper. Consumer sales have slipped and future orders look less rosy. Commentators suggest the economy may slip into recession, probably early 2017 – nobody is predicting how deep or for how long. In the light of such uncertainty, business decisions are being put on hold and future investments reviewed. How might UK fleet operators and leasing companies react in such an unstable political and business environment? Many of the principles are the same as those when the economy enters a recession – maximise economies, watch changing markets, plan for the new shape of your business, adapt accordingly. Let us consider, at this early stage, the issues and actions from the
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fleet operator and the leasing company’s viewpoints. FLEET MANAGEMENT 1. Do nothing. Let the dust settle, wait until a clearer picture emerges in terms of changed relationships and timing, for the individual organisation, your industry and the wider political-economic framework. Theoretically the UK has a maximum of two years to exit the EU once the intention to pursue Clause 50 has been delivered – and that initial decision could take six months. 2. Review fleet and fleet management assuming a short term recession – what cost saving steps can be taken? What investment/replacement decisions can be delayed? If the business is to be reduced/ restructured what will be the implications for the fleet and how can steps be taken to minimise longer term problems? 3. As senior management begins to plan for post-Brexit GET IN THERE. Personal mobility is a cost that gets pushed to the end of the decision process. Ensure fleet is involved in discussions regarding future
FLEET EUROPE #85
EXPERT
HIGHLIGHTS Brexit engenders many questions. But, it can also lead to exploit fleet business opportunities in a new direction.
business shape/location change. The exercise may well go through several false starts and iterations. Accept it – nobody has done this before – but ensure fleet is central to the deliberations. 4. Model the new fleet against planned business structures and locations. Examine the alternative means of providing that mobility capacity. Will jobs be moved abroad – to where? What will be transport requirements in those new or expanded locations? Will there be a rundown in the UK operation – if so when – and how? Who will remain in the operation? 5. Plan that detailed changeover. If you lease, does your current leasing company work in the likely future location? If not, who is there? Determine normal fleet profiles and costs in the new location. What support would be required? 6. Keep contingency plans up to date – they will evolve. Who will run the post-Brexit fleet? 7. Look for promotion. If your business has European links, postBrexit those links may well change. The challenge is to plan for change, gather data and develop a dynamic model for regular management review. LEASING COMPANIES Brexit may create new business opportunities for pan European leasing companies or those with associates and partners in the region. Like individual fleets, it’s too early to look at numbers but some plans can be made even at this early stage. 1. Visit all of UK your leasing clients. Which are likely to change the shape of their
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businesses post Brexit? Be aware of their planning processes from the beginning. What part of the business might move to mainland Europe – and where? 2. Work with your associated companies in Europe to develop practical plans to be offered to you UK clients as they review their options. Maybe you need a Brexit Manager to focus effort although that individual may already exist. What will be the sort of questions fleet operators will ask? Many are noted previously, but be sure you can answer them. If your business is sufficiently on the ball, your clients should not have to look elsewhere for fleet advice. Oh yes, don’t forget some financial recompense from your European partners in terms of bringing them new business! 3. Review other business you have in your sights that may have a need to develop their EU operations. Offer them the same degree of support. You never know what additional business may be waiting to be plucked. Competitive European leasing companies will be looking for business opportunities within the UK and companies growing in mainland Europe; protect your potential. Although Brexit is not due to happen for some time, there will be organisations running ahead of the main stream that may require assistance – be there to advise and gather future business opportunities. PROBLEMS AND OPPORTUNITIES Brexit will create problems and opportunities. At this stage nobody knows exactly what is involved, when, or to what extent changes will be necessary. The challenge is to be entrepreneurial and pull together a basic framework within which the business can plan and exploit opportunities in a new direction – make the conditions right for you.
• The stating gun has been fired for Brexit; nobody knows when the project will begin or how severe will be the shakeup. • Gather information and stat planning; two thirds of the time should be spent planning and one third implementing. Avoid false starts. • Fleet operators; be prepared for a period of recession and recovery as well as Brexit. • Discuss with management the anticipated shape of the business; UK based and any move of jobs into the EU. What are the fleet implications? • Fleet operators; review the shape of your current and evolving business and how you would change the shape of the fleet to provide capacity. • Research personal transport requirements and providers in your post-Brexit era. • Be ready to act and implement the new fleet structure when decisions are made. • Leasing companies; review your clients and their likely changes in demand postBrexit implementation • Look for other businesses that may use your assistance. • Work with EU associates to be able to help clients – both ways.
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ANALYSIS
Big data and the fleet revolution Jonathan Manning
The connected car will transform the management information available to fleet managers, but there are data protection issues and cybersecurity risks to confront.
At the time, it was a genuine ‘eureka’ moment, a prime example of how basic vehicle tracking data could revolutionise fleet efficiency, saving hours of time and millions of litres of fuel. Back in 2001, parcel delivery company UPS began to investigate journey information from on-board tracking systems. Its aim was to devise route optimisation plans, and it made a simple yet extraordinary discovery. By reducing, or even eliminating, the number of left-hand turns its drivers had to make, it could increase efficiency, reduce fuel consumption and get drivers back to their depots earlier. “Having more concise data of how a vehicle performed during its delivery route allowed us to see where efficiencies could be improved,” said Elizabeth Rasberry, a UPS public relations manager. “What we found: A significant cause of idling time resulted from drivers making left turns, essentially going against the flow of traffic. From there we explored routes where these turns were cut out entirely, and then compared data.” The tracking data proved that more packages could be delivered in less time with reduced emissions by driving in a series of right-hand loops, even if this meant traveling a greater distance. Today, telematics information is so much richer and more immediate that efficient route planning is merely one of a number of major gains available to fleets. Employees and cargoes can be tracked in real time, which enables companies to provide more accurate arrival times to clients. On-board
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monitors can identify higher risk drivers by recording incidents of excessive acceleration, speed, braking or swerving. And in the event of a crash, telematics data, increasingly allied to video images of the collision, is helping to settle insurance claims more swiftly and more fairly. But technology is advancing so rapidly that even telematics barely scratches the surface of how the combination of the ‘connected’ vehicle, autonomous driving and the internet of things hold the capacity to transform fleet management. Drive Software Solutions, which works with some of the world’s largest fleet leasing and management organisations, confidently forecasts that, “the next five years will produce more change in automotive technology and how vehicles are managed than we have seen in the last 40 years.” Fleet efficiency could be revolutionised if organisations can harness the wealth of information at their fingertips. Such progress also comes with risks, however, forcing vehicle manufacturers and employers to address issues such as cybersecurity and personal privacy. From a fleet management perspective, connectivity will provide valuable, realtime information on a vehicle’s service and maintenance requirements. Drivetrain trouble codes, for example, can highlight components in danger of failure, allowing fleet managers to take preventative steps, said Edward Kulperger, vice president, Europe, Geotab. The global telematics technology company collects over 900 million points of data each day, with two-thirds of these records related to engine data. FLEET EUROPE #85
ANALYSIS
“Big Data and machine learning is an area that Geotab is investing heavily in,” he said. “Examples of some outcomes of this is [the ability to] understand when, what and where vehicles components break down. This knowledge is now being used by some of our clientele to proactively manage swapping out vehicle parts, alternators for example before they break down.” The opportunity for fleet operators to relay wear and tear data from the vehicle directly to a workshop enables the garage to preorder any replacement parts required. “You can optimise the maintenance process and reduce the downtime of the cars,” said Steffen Klaeger, communications manager for Bosch’s connected cloud services. The first challenge for fleet operators, though, is to ensure all their data feeds are compatible with their fleet management software system, a significant issue as individual vehicle manufacturers each start to install their own, unique vehicle telematics systems as original equipment. The second challenge is to avoid being overwhelmed by the flood of data. “You need good dashboards that aggregate the valuable data so you don’t need to look at hundreds or thousands of cars,” said Klaeger. “It’s very important to get the right data visible when you need it. For example, the maintenance intervals for specific cars, so you can see that in the next two weeks these five or 10 vehicles need an appointment in the workshop. Then you can schedule it and include the workshop in the process so they can get access to the telematics data.”
ensuring that privacy and security are paramount (and in some instances even regulated), as legislators continue to strive towards finding the balance between the socio-economic benefit of these solutions around saving lives and reducing congestion and carbon output and data privacy.” And then there’s the risk posed by cyber attack. In March, the FBI and US National Highway Traffic Safety Administration warned that vehicles are ‘increasingly vulnerable’ to hacking as the number of electronic control units (ECUs) increases. ECUs control functions such as steering, braking, and acceleration.
10 MILLION
“These new connections to the vehicle architecture provide portals through which adversaries may be able to remotely attack the vehicle controls and systems,” said the FBI.
THE VOLUME OF FUEL SAVED BY UPS SINCE 2004 BY AVOIDING LEFT-HAND TURNS
Plus, as more vehicle components have wireless capability, including keyless entry, tyre pressure monitoring and navigation and entertainment systems, there are more access points for hackers to target. “Third-party devices connected to the vehicle, for example through the diagnostics port, could also introduce vulnerabilities by providing connectivity where it did not exist previously,” added the FBI.
GALLONS
900 MILLION POINTS OF VEHICLE DATA CAPTURED DAILY BY GEOTAB
This capture and sharing of data does, however, create sensitive issues for fleet operators. Drivers may well object to the ‘Big Brother’ approach where their employers track their every movement. “There are personal or privacy solutions available in the market today,” said Geotab’s Kulperger. “Elements such as not providing location or GPS information, or automated or manual privacy switches and features provide that comfort. The fleet telematics market in general need to keep FLEET EUROPE #85
Telematics information is better and faster than efficient route planning. Also it allows delivering packages in less time and with less CO2.
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ANALYSIS
For Steffen Klaeger, Communications Manager for Bosch’s connected cloud services, “you can optimise the maintenance process and reduce the downtime of the cars.”
Cybersecurity is a pressing issue for Governments keen to introduce the safety and environmental benefits of connected cars. Drivers won’t accept autonomous systems if they worry that a hacker can take control of their vehicle. But the media’s focus on ‘game over’ scenarios, where hackers take over a vehicle’s steering or cancel its brakes are dramatising the wrong risk, said Dvir Reznik, senior marketing manager, automotive cyber security, of TowerSec, part of Harman Connected Car. “We have not seen those examples of difficult game over scenarios. Mostly it’s a case of someone gaining access to your personal data or navigation system,” he said. TowerSec has two principle cybersecurity products to protect vehicles. TCUSHIELD defends a vehicle’s telematics devices from malicious attack, preventing hackers from gaining control of key functions such as brakes, accelerator and steering. Secondly, ECUSHIELD creates real-time firewalls to defend external communication channels such as WiFi and Bluetooth. Both systems are designed
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for OEM clients, however, rather than fleet retro-fit. “We are strong advocates of the securityby-design approach,” said Reznik. “When you are designing and manufacturing the next car, then the car is no longer just hardwear on four wheels. It’s a piece of software, and you need to be cautious and conscious about what types of security you are implementing when architecting and designing the modern car.” And the modern car will be rammed with connective technology, whatever the privacy or cybersecurity concerns, presenting huge opportunities for fleet operators. “Overall, the advent of automotive ‘Big Data’ has to be good news for fleet managers,” said the BVRLA, the representative body of the UK’s leasing and rental industry. “As well as enabling them to do their current job better, it also means they can become more strategic in their role. They can be far more pro-active in dealing with issues around vehicles and drivers before they become major problems, and have far more influence on the total cost, safety and efficiency of the fleet.” FLEET EUROPE #85
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Dear readers, This 3rd Face to Face of our series should have “confronted” Montse Empez Vidal, Chief Purchasing Officer of Applus, and Mariano Tristan, European Fleet Project Leader at Eli Lilly. Due to strategic communication reasons, the communications department of Eli Lilly asked us to not publish the interview of Mariano Tristan. As we didn’t had time to reschedule another discussion. You will find here only the interview of Montse Empez Vidal. Don’t miss our next Fleet Europe issue with a new Face to Face.
Be flexible and open-minded The Editors
Steven Schoefs & Antigoni Vokou @StevenSchoefs - @Antivokou
Pictures: Domènec Fernàndez Bachs
Barcelona is famous for its great sunny weather, its Sagrada Familia basilica, its paella and the golden sand of its beaches. But we had business on our mind, so we made our way to the Fairmont Juan Carlos I hotel, near the Avinguda Diagonal that dissects the Catalan capital. On the steps of the hotel, we bumped into a scrum of photographers chasing Mariano Rajoy, the Spanish Prime Minister. There, we met with Montse Empez Vidal of Applus and discussed cost control, the added value of telematics, the criteria for choosing a funding method, the impact of IFRS16 on TCO and the rise of car-sharing.
Montse Empez Vidal APPLUS
JOB TITLE Chief Purchasing Officer NUMBER OF CARS 4,500 (PC and LCV) NUMBER OF COUNTRIES 23 IN FLEET MANAGEMENT SINCE 13 years REPORTING TO CFO FUNDING METHOD Operational lease 52 %, owned 21 %, long-term rental 13 %, capital lease 11 %, others INTERNATIONAL CAR POLICY Yes INTERNATIONAL GREEN/MOBILITY POLICY No
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STRATEGY & TCO
What is the main goal of your international fleet policy for 2016 and how you plan to achieve it? MONTSE EMPEZ VIDAL Difficult to select one single goal. I would say cost control, but also harmonisation of and compliance to the policies are crucial. Cost efficiency has always been a key driver in our company, especially because of market pressure and also because fleet is our third-biggest spend. When selecting new cars, we assess all options: whether to renew or extend the car contract. At Applus we need to be extremely flexible, as car acquisition depends on our company’s activities. Unlike most companies that have a permanent vehicle fleet designated to employee profiles and job functions, at Applus we work with designated projects, which will differ in time, so a fixed car policy is not possible in our case. To create fleet efficiency, we need to look at the contours of each single project that we are assigned to, and that implies that sometimes rental cars can be more costefficient than leased ones. Good procurement has nothing to do with chasing the lowest price. Procurement is about getting the right price for the right product, and that is what we do.
When implementing your car fleet policy, how do you realise compliance? M.E.V. We cannot have the same policy all around the globe in terms of compliance. We have different compliance policies depending on geography and car fleet business reality. In Europe, we have small passenger cars. Sometimes there are complaints and challenges, as when in Germany we moved from Volkswagen to Fiat. But, as we checked engines and sizes, at the end everyone was happy. So far, so good. In the U.S., small passenger cars are not acceptable. What they need are small and longer pick-ups. In South America, where we need vehicles fit for tougher road conditions, we’re not yet at 100 % with compliance, but only at 60-70 %. That’s FLEET EUROPE #85
because it’s very technical, as there are mostly operational cars and not management cars in this region.
Which are three main elements on which you base your funding method? M.E.V. The main reasons for deciding a funding method are the added services like insurance, the geographical coverage and the pricing. Also, the fiscal regulations, the impact that each funding method would have and our financial ratios selecting the one that is better for the overall numbers. So far the preferred option has been operational lease, however, given the new IFRS regulations that will be applicable in January 2019, we might need to reconsider all options and assess their impact on our overall ratios.
When developing your international fleet policy, what was the biggest obstacle and how did you overcome it? M.E.V. We have encountered several obstacles but our biggest challenge was data gathering and dealing with the lack of information about our fleet and about possible solutions in various markets. This made it very difficult to develop any policy that made sense to the company. We had no idea how many cars we had or where they were located. It took years to gather all relevant data. Once this exercise was done, we could create a policy that matches our fleet reality. We now have a 15-page policy.
Which fleet management achievement are you particularly proud of and why? M.E.V. I am very proud of our selfdeveloped information and data system and the things it helps us to do. It gives us real-time info on our fleet structure, costs, etcetera. This also allows us to take decisions in an efficient, effective and even predictive way.
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MOBILITY & DATA CONTROL
Do you perceive a move towards mobility management?
WHO'S WHO: MONTSE EMPEZ VIDAL What was the first thing on your To Do list for this year? Consolidate fleet policies and fleet programmes in all the regions. What’s your biggest car fleet management mistake ever? Assuming that we could standardise until the end. What’s your passion outside of the fleet business? Work in the United Nations. However, I moved to Purchasing, where I can still negotiate. If you weren’t in this business, what would you like to be doing? Be with my family, travel abroad, read, ski … What is your favorite holiday destination? Costa Brava Who is an inspiration for you and why? Anyone who challenges themselves to improve and who doesn’t accept that “it has always been like this…”. What is the first car you had? Honda HRV.
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M.E.V. Unfortunately, I think in our case with our atypical fleet that has to deliver added value in extreme conditions and in challenging geographies, we will be among the last ones to adopt alternative mobility solutions. We don’t have the typical sales representative cars, but operational cars that are driven over long distances. We cannot make use of car-sharing as it is understood today, although it is perfectly thinkable for our company to have its own car sharing fleet, because we change drivers every day and we need a system to control that.
Do you use telematics for your fleet?
As rules for car emissions get stricter, how will they affect diesel cars and fleet electrification? M.E.V. If all our questions, doubts and concerns bout EVs are answered, then yes we will change our strategy. Especially since I think diesel will soon be banned from many cities, including Paris the city we’re in, Barcelona. So we need to have other alternatives available and when they fit our mobility and corporate profile we will definitely choose to go greener than we are today.
Do you believe TCO will go up in the up in the upcoming years?
M.E.V. We provide it as an option for managers’ cars: 50 % of them are fitted with telematics. For our operational vehicles, it’s mandatory. We do have benefits from using telematics: we can track the routes, driver behaviour, etc. But what we’ve seen – and here I disagree with all the optimistic speeches at conferences – is that with telematics you see benefits only for the first six months. After that period, people don’t care anymore about the device and they go back to their old habits. So telematics will only benefit you if you also have a driver behaviour programme in place.
M.E.V. We do have a scenario considering that eventuality. We predict interest rates and car prices are going up one way or another. We won’t see those big discount any more like in 2009, when the financial crisis hit the EU. As the economy recovers, prices will go up and in 3-4 years, TCO will have gone up as well. Depending on what happens then, we might mitigate those increases. I expect IFRS16 will impact TCO, and I have the impressions car leasing companies underestimate them or at least try to make us believe nothing will fundamentally change. Well, I’m not sure. Funding our own car, instead of leasing them could be more advantageous for us under the new rules, as it benefits our TCO.
As telematics and technology generate more data, how will you keep a clear view on that data, including full support from your fleet partners?
What is the most valuable lesson you can give your fleet peers for creating efficiency in international fleet management?
M.E.V. In our case, our self-built information system provides us with all the information we need. Also, we hold reviews with the leasing companies we work with. They provide us with more than just a snapshot. They add value by offering an analysis and they come prepared with something in mind so we can work it out together.
M.E.V. Be flexible and open-minded. There’s never only one way.
What is the biggest risk when developing an international fleet strategy? M.E.V. Fix your company’s strategy first.
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Forum 2016: ready for boarding CĂŠline Gilson @CelineGilson
What would happen if you were able to travel forward in time to the 16th of November 2020? What will be the major changes in your fleet and mobility management? Who will be the main players? What products and services will be offered? And what will be the influence of the employee on your car fleet decisions? The time machine is ready. Boarding date: 16 November 2016 in Barcelona. 16 NOVEMBER: FLEET EUROPE FORUM This year, the Fleet Europe Forum will imagine how fleet and mobility management will look in the year 2020; what the roles and business models of the main industry stakeholders will be and what challenges and changes these stakeholders will have to take into account to stay on top of their fleet and mobility game.
Barcelona will be the center of the International Fleet Community on November 15 and 16.
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Whereas for many years corporate mobility was limited to vehicle fleets and the eligibility for corporate mobility access depended on the job function and corporate position of the person, today corporates are providing a mixed pallet of mobility solutions for all employees in the company. The fleet manager has become a mobility manager, managing a more complex puzzle than before with more providers and disrupters, more users and more variety in the solutions offered. On top of this, as all employees are involved in the mobility question, more corporate divisions will have a bigger say in the strategy and decisions. So the fleet manager is more than ever a communicator who has to deal with various departments, providers and all employees while respecting the
crucial concept of cost efficiency and embracing connectivity and telematics, necessary tools to ensure good operational reporting. The product and service providers have changed. With the need for innovative mobility solutions and also the new environmental standards imposed by governments, the traditional and new car manufacturers produce smaller, connected and more energy-friendly cars, while they expand their car related services to the wider mobility approach. Because of the impact of the new IFRS16 on funding mechanisms for vehicles and the need for employees to have multimodal mobility solutions instead of just ‘owning a car’, car leasing companies have all become fleet and mobility management companies (FMMC). As a result, the fleet sector is more than ever impacted by trends like connectivity, real time data, flexibility, digitally accessible tailor made services, and new business providers, specialized in the integration of the mobility modes and comprehensive reporting, have become strong competitors of the traditional industry. They offer connected mobility management, they are fast and they are global. FLEET EUROPE VILLAGE Alongside the Forum, the Fleet Europe Village will welcome more than 50 industry suppliers who will present their new products and services. A unique opportunity to learn, to discover, to ask questions, and also to network with your peers.
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I FMI: FOR INTERNATIONAL FLEET MANAGERS ONLY (15/11) The IFMI full-day session enables you to increase your knowledge and expertise on the most important fleet management topics. Case studies, expert opinions, Q&A sessions will take place during this training day, to ensure you have all the answers to develop your fleet within a framework of cost efficiency, respect of the environment and attention to the driver safety.
More info about the programme and registrations forum.fleeteurope.com
You will learn: • How to set up a fleet safety programme; • How telematics will support your Safety Management; • H ow to successfully embrace Connectivity and Big Data; • How the Caruso project guarantees an open data market; • W hat the IFRS16 means for your fleet; • W hat are the Brexit impacts for fleet management; • How DSM and L’Oréal set up Mobility Management in practice; • How to drive change in fleet management.
F LEET EUROPE REMARKETING FORUM (15/11) The Fleet Europe Remarketing Forum has been created for remarketing professionals to intensify their remarketing operations to successfully embrace the opportunities of tomorrow. Five hot topics will be presented to the fleet professionals to learn about the most crucial elements for their TCO: • How to manage uncertainty in International Remarketing; • How to manage current Remarketing challenges; • The OEM perspective on Remarketing; • LCV Remarketing; • G etting ready for the future of Remarketing.
With this high level two-day programme, it is clear that your interest is to join us in Barcelona in November, in order to be ready and prepared for the fleet challenges of tomorrow.
MANAGEMENT
Top 10 Fleet Trends to succeed Steven Schoefs @StevenSchoefs
The 2016 Global Fleet Conference, from 6 to 8 June in Brussels, wasn't just where today’s fleet management trends were discussed, but also where the future direction of intelligent fleet and mobility management was revealed. Here’s our Top 10 of trends to watch.
GLOBAL ECONOMY The divergence in economic growth, currency volatility and business innovation within and between continents will continue. We can expect an increase of Asian businesses entering Western markets, which will lead to new competition and possible business opportunities for car fleet and mobility suppliers and their customers.
OIL PRICE The oil price has been relatively low for some time, which is beneficial for vehicle fleet TCO. Oil is forecast to stay below 80 dollars a barrel for the coming three years if the geopolitical situation remains relatively stable, and if shale gas production can continue at the current pace.
DIESELGATE In September last year, Dieselgate shocked the automotive world and the car fleet community. Yet it has not had a dramatic effect on diesel car sales nor on residual values. But will this remain the case? Governments and car fleet managers are questioning the future of diesel and the relevance of CO2 as the only important emission norm. It is likely that other powertrains will become more relevant, and that NOx will become more relevant as an emission norm.
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ALTERNATIVE POWERTRAINS Car manufacturers face ever stricter emissions norms and car taxation and legislation is increasingly penalising vehicles with combustion engines, especially diesels. It stands to reason that fleet managers will increasingly turn to alternative powertrains. The question is: which ones? The answer is complex, depending on the use of the vehicle and the profile of the driver/employee. Employee profiling will become key to determining ideal mobility patterns, developing fleet strategies and car policies, and selecting cars and powertrains. At the moment, hybrid vehicles seem the best suited alternative powertrains for professional fleets, but a lot is expected of electric and hydrogen vehicles. The two main questions: Will full-electric vehicles develop enough autonomy to warrant mass-production and thus a better cost/benefit ration? And will hydrogen technology develop into an equally viable alternative?
IFRS16 The new lease accounting standard coming into effect on 1 January 2019, stating that all lease assets will appear on the balance sheet of the lessee. This will impact the car fleet business, not by reducing the popularity of operating leasing, but in terms of accountancy complexity, financial reporting and process management.
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SAFETY The 2016 Global Fleet Survey pointed out that Safety Management is a top priority to be globally defined and implemented. Key for success is that you not only select safe cars, but that you also have a consistent safety programme in place, with attention for driver behaviour, prevention, accident and incident management, in concert with transparent safety reporting and driver training.
TELEMATICS AND BIG DATA For the so-called tools-of-trade vehicles, telematics is a recognised support in fleet management and driver behaviour. But for benefit cars, the situation is rather different. To a large extent, this has to do with questions surrounding privacy, data ownership and internal resistance in the acceptance of telematics. Nevertheless, with the increased attention to driver behaviour from corporates and fleet suppliers and the rise of in-car connectivity, tracking and tracing of employee mobility patterns will become more widespread and eventually generally accepted. The big question for fleet managers will be what data to use, in what format and for what purpose. This should be answered before rolling out a telematics programme, as it will be essential to communicate to all internal stakeholders exactly what the intention and framework of the telematics programme is, if you want to succeed.
DISRUPTION AND INNOVATION The Car Fleet Industry is an early adopter of new solutions that bring added value on the longer term. Think about outsourcing of management, telematics, the sharing principle: our industry didn’t invent these concepts, but was at the forefront of testing and implementing them. Fleet managers are ready and willing to embrace new solutions, especially in the area of mobility. But the solutions that have the most chance of success are the ones that are not only disruptive but also innovative.
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THE SHARING PRINCIPLE Sharing is nice, but sharing a car is difficult. Car sharing is taking off slowly, but will develop rapidly in city centres. This evolution will go in parallel with the change from a car-centric to a user-centric approach from suppliers and corporates. This doesn’t mean the traditional company car will disappear: people living in remote areas and people needing their car almost exclusively for their job will always need their car/mobility mode. But without a doubt the future fleet manager and fleet supplier will need mobility profiling of their customers in order to provide them with the most adequate, most cost-efficient, least time-consuming and most comfortable mobility solution.
TCO TO TCM TO TCMM The Total Cost of Ownership concept is widely known in the more mature fleet markets. It focuses on the total cost of usage of the company car. With the introduction of new mobility modes, this concept needs to evolve to TCM, or Total Cost of Mobility. That concept takes into account the cost of the complete mobility pattern of the employee. It can also be used with employees who are not eligible for company cars. In the near future, it will probably be good to extend the TCM concept even further. The growing attention to climate change, coupled with the carbon neutral targets of multinationals makes it relevant to include the cost of the ecological footprint of the chosen mobility modes, introducing TCMM – Total Cost of Mobility Management. FLEET EUROPE #85
COLOPHON EDITORS Steven Schoefs – Chief Editor sschoefs@nexuscommunication.be Antigoni Vokou – Journalist avokou@nexuscommunication.be Céline Gilson – Project Coordinator cgilson@nexuscommunication.be CONTRIBUTORS Tim Harrup, Frank Jacobs, Jonathan Manning, Damien Malvetti, Dieter Quartier EXPERTS Professor Peter N C Cooke (University of Buckingham), Michael Gergen (Dataforce) Cover: Modul System Pictures: ©Shutterstock - ©ThinkStock Layout: Hungry Minds info@hungryminds.be
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SALES & MARKETING David Baudeweyns – International Key Account Manager dbaudeweyns@nexuscommunication.be Sigrid Nauwelaerts – International Key Account Manager snauwelaerts@nexuscommunication.be Daniel Savigny – International Key Account Manager dsavigny@nexuscommunication.be Aline Verpoorten – Internal Sales Assistant averpoorten@nexuscommunication.be Virginie Emonts – Sales and Marketing Assistant vemonts@nexuscommunication.be ADVERTISEMENTS SEAT (2), ŠKODA AUTO A.S. (4), Alphabet International (9), Daimler AG (16-17), ARI (21), FCA (31), Jaguar Land Rover (34-35), Volkswagen Financial Services (40), Adam Opel AG (47), Renault (59), Hyundai Motor Europe (68).
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www.fleeteurope.com Fleet Europe is published by Nexus Communication SA Parc Artisanal 11-13, B-4671 Barchon (Belgium) T +32 4 387 87 71 - Fax +32 4 387 90 63 - contact@nexuscommunication.be Fleet Europe is registered and copyrighted trademark. Reproduction rights (texts, advertisements, pictures) reserved for all countries. Received documents will not be returned. By submitting them, the author implicitly authorizes their publication. PUBLISHERS Caroline Thonnon – CEO & Head of Business Development Thierry Degives – CEO & Managing Partner
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