A major deal with one of Britain’s biggest leasing companies could prove to be the “catalyst” that redefines the fleet tyre market.
That’s according to Fleet Tyre Network (FTN), one of three new tyre fitment suppliers appointed by LeasePlan UK.
The leasing giant dropped its previous supplier Kwik-Fit in favour of a multi-supplier approach that it says will better meet the needs of fleets and their drivers.
ATS, National Tyres and Autocare, together with FTN, will now provide its 147,000-strong fleet with tyre replacement and repairs for both cars and commercial vehicles.
Neil Dixon, head of procurement and supplier management at LeasePlan UK, said: “We awarded the business to the three suppliers that demonstrated the scale, capability and great customer service necessary to meet the needs of our drivers, regardless of their location or vehicle type.
“LeasePlan is committed to delivering a high quality driver experience. We demand an innovative, customer-focused approach to the management of our drivers’ vehicles, and it is vital that our suppliers share this ethos.”
FTN provides a unified supply route for independent tyre retailers and was launched in 2012, with the aim of delivering a service tailored to a customer’s need (Fleet News, December 6, 2012). It has a network of 970 centres, backed by a fleet of 770 mobile fitters.
The decision by LeasePlan to change the way tyres are supplied to its fleet from a single supplier to a panel of fitters matches FTN’s belief that a multi-supplier model benefits both the leasing company and end-user fleets.
“The fleet market has become far more diverse over the past few years,” said Martin Towers, sales director at FTN.
“There are far more LCVs coming into the contract hire market, with increasing customer and vehicle demands, and that’s why we believe not one person can do it all.”
The fleet tyre fitment market is dominated by Kwik-Fit, with some suggesting it holds as much as an 85% share. However, Nick Bennett, managing director of FTN, is keen to stress that Kwik-Fit aren’t the “enemy of the industry”.
“We’re really happy to work alongside Kwik-Fit, ATS, National, whoever,” he said.
“We’re not parochial, we never intended FTN to be a single source solution, it’s about giving customers greater scale and great customer service.
“LeasePlan’s decision to adopt a multi-supply model is a massive catalyst for change. They’ve suddenly made themselves incredibly different to everybody else by saying to customers you can go to three or four times the volume of sites . Eventually, the rest will follow suit.”
FTN told Fleet News there has been a lot of interest from other leasing companies in the wake of the LeasePlan deal.
But it might not prove so easy for leasing companies locked into tyre repair and replacement deals, and those that no longer have relationships with tyre manufacturers.
“Some of the leasing companies have lost their ability to buy tyres,” said Towers. “They instead negotiate on a pounds per vehicle per month basis, not on the cost of the tyres.
“It has taken away the contract hire understanding of how much a tyre costs.
“You need to have that relationship with the tyre manufacturer to get the best deal you can.”
FTN is targeting rental companies and end-user fleets, as well as the leasing industry, and announced a further deal just days after securing LeasePlan’s business.
It will be responsible for Europcar’s replacement tyre requirements in both its rental locations and while its vehicles are on hire (fleetnews.co.uk, November 29).
The service is geared around Europcar’s customer service and commercial objectives, with a particular emphasis again on improving the customer experience.
Ken McCall, managing director of Europcar UK Group, said: “Tyre replacement is a necessity and it is imperative the service is swift and painless, the customer is back on the road quickly and the vehicle down-time minimised.
“I have every confidence FTN can meet that requirement.”
Bennett added: “Our ambition is to create an open tyre market, where customer service and free choice are made available to all without compromising cost.”
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Gareth has more than 20 years’ experience as a journalist having started his career in local newspapers in the 1990s. Prior to joining Fleet News in 2008, he worked in the public sector as a media advisor and is currently news editor at Fleet News.
Ste - 04/01/2016 11:29
Agree with Bennett's comments, more competition in the supply market the better. However I agree to disagree with Towers, leasing co's don't have to lose their ability to buy tyres or know the 'true' cost of a tyre (although I'm sure only the CEO's of the tyre OEM's truly know that!) so long as the leasing co is tendering all the various supply models correctly and thoroughly - it just comes down to good procurement practise. Watching this space for the drivers customer service experience..