Interview: Hitachi Capital Vehicle Solutions’ Jon Lawes on continuing ‘business not as usual’
Jon Lawes, managing director, Hitachi Capital Vehicle Solutions, tells Fleet World how the company has taken action to ensure continued operation during the coronavirus pandemic and how the fleet sector may change in the longer term.
How has Hitachi Capital Vehicle Solutions (HCVS) adapted to respond to coronavirus?
Before the nationwide lockdown was announced, we set up a dedicated Operations Incident Team to contact every supplier across our network. We have contacted repairers who cover 84% of our essential services and critical vehicles, of which 83% repairers are available. Our focus remains on making sure we can react to any fluidity within our supplier network – be that sourcing alternative garages or recruiting new suppliers. Our teams are busy maximising workshop availability with fleet’s compliance and uptime our main priorities. We are ensuring we keep critical fleets on the move to continue serving vulnerable people during the pandemic and have refurbished some of our ex-service vehicles to ensure we support our customers at these difficult times.
We’ve been contacting all of our customers with vehicles due for renewal in the next six months to offer them the ability to extend their contract. This has been done on a case by case basis to ensure we consider the most appropriate option for each and every driver, be that driving instructors or corporate fleet drivers.
We have understandably seen a large increase in enquiries from our customers during this period and have focused on mobilising and training colleagues from other departments to support our Customer Services teams. This has enabled us to continue to have personal contact with all of our customers to discuss any concerns they might have around payment options during this challenging time.
As the situation continues to develop, where there is a need to dynamically re-shape the fleet, being supportive, listening and engaging is what is needed most. And we are ready to engage our consultancy teams to provide the support and modelling our customers need. With expertise across every vehicle type, from small cars to complex HGVs, we are ideally placed to share ideas and initiatives with our customers to support their decision making. Fleets have a long history of adapting to market challenges, and ultimately overcome them. This is what makes, and will continue to make, our industry so dynamic and engaging to be a part of.
What general trends are you seeing in the fleet and wider automotive sector?
Every fleet operation has a unique set of reasons and challenges as to why vehicles have to be parked up during this period which could be operational, economical or logistical. This is why we are engaging with customers on a case-by-case basis to ensure they have solutions in place that are most appropriate to their business and tailored to their individual needs.
As the latest SMMT new car registrations figures for March illustrated, the demand for new car sales has dropped significantly amongst consumers and businesses. We expect this trend to continue whilst the lockdown measures are in place, although it is paramount that the green agenda remains front-of-mind with policymakers to support the transition towards electric vehicles.
The UK’s car industry is resilient and we’re confident the sector will begin to bounce back once the lockdown measures are gradually lifted. We’ve already seen positive steps being taken by manufacturers such as Vauxhall and Volkswagen to resume production with additional safety measures in place to protect their employees.
Which changes do you think will last longer term?
Whilst the pandemic impacts us all, it does so uniquely to each of our customer’s businesses and the sector in which they operate within, meaning longer term changes will vary. At HCVS, prior to the lockdown we were already at an advanced stage of preparation mobilising teams to work at home where they could. We moved to 99% of people working from home within 24 hours of the nationwide lockdown. Operationally, we still have 99.8% fleet availability and continue to serve customers in the ‘new normal’ meaning there will be departments able to work with more flexibly from home post lockdown.
There will undoubtably be longer term changes to personal hygiene precautions into the ‘everyday’ in our industry. For example, we currently check rental vehicles for damage, but there could be a need for rental/pool vehicles to be disinfected before use through an approved scheme. We’ve supported customers running essential services fleets to introduce new personal hygiene levels such as protective screens between drivers and passengers and we expect to continue to proactively continue to introduce requirements for PPE for transport workers.
There may also be a lot of change to the way in which people travel following lockdown; be that increase in personal transportation to avoid crowded public transport or in a reduction in non-essential overseas business travel to limit personal exposure to potential foreign agents.
The way consumers and drivers research new vehicles has increased to be more digitally led and post lockdown, this could change permanently. Social distancing will be a priority for most long after lockdown has lifted, meaning footfall at dealerships could take longer to recover and car sales operations will need to continue to adapt a more digital approach to a more flexible, distant way of selling.
In summary there are some positive outcomes of the national lockdown that will have a productive and agile impact on our industry. We’ve proven we can operate with 99% of our workforce being at home and continue to find new and exciting ways of continuing ‘business as not normal’.
Will the lockdown, once ended, increase driver interest in electric vehicles?
After seeing the impact that lockdown measures have had on air quality, we absolutely expect interest in EVs to continue to increase this year. There may well also be an increase in the number of drivers considering to move to EVs sooner than they had originally anticipated, as the personal and business use of vehicles will have reduced dramatically during the lockdown. A key hurdle to overcome will be to establish an adequate charging infrastructure framework to support the mass adoption of electric vehicles, which is why we are contributing our expertise to Optimise Prime, the world’s largest EV trial, collaborating with a range of partners to help the industry to overcome these barriers.
It will be essential for businesses to educate employees now on the benefits of alternatively fuelled vehicles (AFVs), so that they are well informed on what the future holds for the fleet sector and can make the right decisions based on their needs.
There will be cases where a cleaner petrol or diesel option remains most suitable bearing in mind the efficiency improvements being made by manufacturers. Significantly, however, the new BIK rules make hybrids a particularly attractive and affordable option, allowing for shorter journeys on electric and provide the option of petrol for longer travel.