Interview: Marc Samuel, head of fleet operations at Honda
Marc Samuel, head of fleet operations at Honda, spills the beans on the company’s electric future. Jonathan Musk reports…
Honda is undergoing an internal revolution. While the rest of the car industry is trying to cope with a reduction in diesel sales, WLTP, Brexit and the onslaught of electrification – Honda is pacing itself to objectively look at the market and act accordingly.
Its four car line-up (Jazz, Civic, HR-V and CR-V) is being met with a fresh four-tiered approach that will include battery electric vehicles, mild-hybrids, full hybrids and plug-in hybrids. This in addition to an ultimate direction that moves progressively toward a possible hydrogen fuel cell vehicle future, as pioneered by its Clarity model.
For fleets, Honda has rolled out several tools and a structure aimed at simplifying the fleet buying process, as well as providing after-sales support. Marc Samuel, head of fleet operations at Honda, said, “We’ve worked hard to build a strategy in the team that gave access to as many customers as we could. We worked with a company called ROI to develop our virtual account management structure, which has allowed us to speak to our SME and sub-400 fleet customers.”
The result is an increase in coverage of some 300% in terms of client communication, which Honda sees as key in establishing and maintaining good relationships. “People in certain SMEs don’t have the time. So, actually a 25-minute call or Skype for Business meeting with a full agenda gives them the option for everything they need to do, rather than sitting down with an area fleet manager for an hour when they’ve got other things they need to be doing,” Samuel added.
In terms of volumes, in the last financial year, Honda sold in the region of 17,000 vehicles to fleets – higher demand than the company had anticipated. Key fleet models now include the Honda Civic diesel and new CR-V, which have contributed to the demand and despite a general move away from the diesel in general. “The re-launch of Civic and CR-V has allowed us to get new sales where we weren’t considered previously,” Samuel commented.
However, when factoring in private sales, Honda has observed similar decline to the rest of the industry, yet its corporate sales have propped things up. Samuel added, “What we’ve tried to do is work with end-users and leasing companies to provide us with sales that we haven’t had to go down the tactical sales route for.”
Pioneering services, Honda was first to introduce a virtual programme to assist fleets. “The Virtual Account Manager programme was unique when we launched it and is probably the most established of the programmes out there,” said Samuel.
“We work very closely with the leasing companies, as most do, but we also have our own Honda Contract Hire, so we’re looking at BCH and PCH with a focus on BCH to make it as competitive as possible.”
“We’ve seen a definite rise and BVRLA figures support it in the contract hire of vehicles. In terms of anything unique or enticing, I think what we’re going to do is stick to our guns – we know the products, we know that we’re competitively priced. We want to create business relationships rather than a loss-leader approach with a tasty sales campaign.”
Dealerships are, of course, the point of contact for most customers and it’s important not to alienate smaller or larger fleets. To ensure that doesn’t happen, Samuel added: “We’re investing quite heavily into the dealership network. We have the Platinum Programme within the network and that is an evolving programme of support from the dealer network to be able to sell to corporate customers, both on a local business, SME basis or to major customers as well.
“We work quite closely with a fleet working group where we engage with 12 parties from around the network to make sure that what we do is actually allowing them to transact business with smaller fleets or corporate businesses equally. That’s seen some real positive gains.”
The Platinum Programme is open to any fleet and ensures cars are provided for test or appraisal, rather than risk the potential of a dealership being unable to help. 48-hour test drives are possible on models further enhancing the availability for cars and allowing fleets to see in practice that the vehicles can work for them.
The right tool for the right job
Diesel is still very much alive at the company too, despite the fuel-type having been dropped from the recently launched new CR-V in favour of a new hybrid system. “Civic Diesel is still the right fuel choice for many drivers”, Samuel added, though the new generation of Honda hybrids are the obvious alternative. Other models to receive the hybrid template are likely to include future models of Civic and Jazz, while the Japanese brand’s full-electric range will sit slightly apart, as indicated by the E Prototype concept shown at the Geneva Motor Show. And, though it shares some of the market space held by the Jazz, Samuel doesn’t believe the diminutive Honda will be replaced by an electric model anytime soon.
“Honda E Prototype will sit distinctly away from the Jazz, which will get a level of electrification or hybridisation in the next facelift in a couple of years’ time. So, it will be updated. I think Jazz is a mainstay product for Honda,” he commented.
Market factors that make life difficult for the humble hatch – the current SUV trend and small electric models potentially replacing A-segment petrol cars – don’t appear to have affected demand for Honda’s smaller vehicles either. He continued, “We haven’t gone into fleets with a single model, single type, which can distress the product to an extent. Jazz has options and the size of the vehicle allows us to have options. And the fact that we have these hybrid and electric technologies coming through gives Jazz a place in our fleet for some time to come.”
And, despite having already made a head start on many of its competitors with SUV models HR-V and CR-V, there aren’t plans to do any gap filling with new SUVs to complement the range. To the contrary, Samuel believes there may even be a renaissance for C-segment hatchbacks that Honda could capitalise on.
“When I first started in fleet there were four categories of car: A, B, C and D. Today there’s around 15 different segments. We know where our cars fit. There is no intention to keep developing. As you’ll see from the E Prototype, it is a B/C-segment sized car with an electric engine, but there are no current plans to develop beyond that.
“I think SUV is pushing and pushing, but there might actually be a resurgence in C-segment vehicles. And actually, if some [brands] come out of the C-segment, which some are stating they will, then that gives [Honda] the opportunity to push Civic more.”
Leaving the UK, remaining British
In February, Honda shocked the nation by announcing its withdrawal from manufacturing in the UK, and effectively Europe, with the closure of its Swindon plant in 2021. The decision is said not to have been as a result of ‘Brexit’, but rather to move production back to Japan and in light of a change in EU regulations that would see a lift of import tariffs for Japanese-built cars into Europe. The company has confirmed, however, that it will retain its European headquarters in the UK, as well as its Formula 1 operations.