Lip service is not enough
There is a common theme running through chats I’ve had in recent months with bosses of car companies and dealer groups. At some point in the conversation fleet comes up and the desire to better facilitate fleet requirements through local dealers.
Reading between the lines the message is clear. Fleets, especially those operated by SMEs, have been under-valued by carmakers and their dealers, both preferring to chase the bigger returns offered by volume deals.
However, in these leaner times the wants and needs of SMEs are being paid more than lip service. Carmakers and dealers have begun to appreciate how important local businesses are to them, not just in terms of car sales but also the provision of servicing and repair jobs.
When I asked Mark Lavery, chief executive of Cambria Automobiles, one of the country’s top 30 franchised dealer groups, how important local fleet is to his business, he summed it up in just two words: ‘Mission critical’.
The Cambria approach is typical of many dealer groups but to find out how it is filtering through to fleet managers, I asked Julie Jenner, chairman of the Association of Car Fleet Operators (ACFO). She pointed out that with over 60% of company cars operated under some form of lease, the opportunity for fleet managers, especially those running big fleets, to build meaningful relationships with their local dealers is limited.
‘These are busy people for whom running the fleet is often only one part of their job function. They will be interested in controlling costs, minimising downtime and making sure cars are returned promptly, so in many cases they won't care if this is being managed by the leasing company or through a local dealer,’ she said.
However, she does welcome moves made by some car brands to offer a more personalised service to fleets.
‘For too long motor manufacturers appear to have had as their sole focus Britain’s biggest fleets, but the vast majority of organisations operate less than 100 vehicles. Although many contract hire and leasing companies do a good job in providing fleet advice to customers it can, in some cases, prove to be a one dimensional view. Manufacturers that have recruited business advisers to be the conduit between themselves and their customers are likely to see the move vindicated through rising sales.’
Jenner makes a valid point that fleet managers are driven by the need to keep a lid on costs and this is where many main dealers have lost out to more price sensitive independent repairers, many of whom can also offer high quality levels of service.
Halfords Autocentres is an impressive repair chain with strong branding and operating on a national basis, from over 260 outlets. It also makes a virtue out of aggressively undercutting the servicing and repair prices charged by franchised dealers.
‘Would I recommend the use of non-franchised workshops to ACFO members? Absolutely. Yes. Competition is healthy and if fleets can still get a high level of service, then why not?’
An area where dealers and carmakers could potentially get closer to fleets is through a greater readiness to encourage user-choosers to test drive their demonstrators.
‘One of the biggest complaints fed back to me is from user-choosers who say dealers don't want to know them as they know they will not be making a sale,’ Jenner revealed.
Perhaps there is a genuine opportunity here for dealers to work closer with local SMEs by proactively offering test drives to user-choosers. For such schemes to work they would need to be backed by car manufacturers as they will generate sales, but not necessarily through the dealer. Now there’s a gauntlet for manufacturers and dealers to consider.