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BVRLA has positive news for fleet industry in 2013 outlook

The association says that the fleet sector will continue to be a reliable source of business for manufacturers who will struggle to cope with what is likely to be a volatile retail market. It adds that new fleet car registrations will continue their recovery with slow, but steady growth, driven by greater penetration into the SME market and the continued popularity of salary sacrifice schemes with larger corporate customers.

New BiK tax thresholds will continue to push average fleet emissions down, probably by another 3 or 4%, and will lead fleets to move emissions caps to 130g/km, giving an advantage to those manufacturers who have been able to produce a significant range of models below that level.

For commercial vehicle registrations, the BVRLA predicts steady growth for both van and truck registrations, with the latter in particular driven by operators choosing to replenish their fleets ahead of the introduction of new Euro-4 emissions standards.

Commenting on EV sales, the BVRLA said: ‘The potential surge in EV registrations we pointed to last year didn’t happen, but we are not going to take the blame for that. Prices are still too high and the catastrophic own goal scored by the Government, whose March 2012 Budget will result in fleets actually being incentivised not to lease EVs from this April, did the damage.’

It added: ‘Prices of EVs will continue to come down, but in isolation this will not be enough to create significant momentum in this market.’

The BVRLA had more positive news for funding, saying that ‘the industry enters 2013 with healthy supply of funding and funders, with a range of new entrants firmly entrenched in the market and lending. Another massive bonus is the decision of the industry’s largest funder, Lloyds Banking Group, to renew its commitment.’

On the subject of industry consolidation, the association commented that we are not seeing much of this at the moment, adding: ‘The BVRLA reported an increase in members during 2012 and we see continued growth in the short-term at least. Much of this growth is coming from “captives”, because manufacturers, who have traditionally remained in the background as suppliers of finance, are becoming directly involved in the sector, either as leasing providers or suppliers of "pay-as-you-go" mobility solutions.

‘In an era when demand for the traditional company car is static at best, these new entrants are helping to enlarge the overall vehicle rental and leasing market.’

Finally, the association also commented on the subject of RVs, saying that these will remain strong. It added: ‘No one currently knows what a normal used car or van market looks like and seasonal trends have almost disappeared. All we can be sure of is that the UK is facing an almost unprecedented supply shortage of quality young used vehicles. With the economy hopefully entering a more sustained growth phase, this shortage will continue to support stronger residual values.’

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Natalie Middleton

Natalie has worked as a fleet journalist for 16 years, previously as assistant editor on the former Company Car magazine before joining Fleet World in 2006. Prior to this, she worked on a range of B2B titles, including Insurance Age and Insurance Day. As Business Editor, Natalie ensures the group websites and newsletters are updated with the latest news.