Fleet news winner: BMW aspires to give ‘best experience’ to fleets and their drivers

The Fleet News Awards 'best plug-in car 1-50g/km' winner was the BMW i3 range extender. 

Last year, BMW leapfrogged its rivals to become the biggest manufacturer in true fleet, as measured by the official registration figures from the Society of Motor Manufacturers and Traders (SMMT). The company increased corporate sales by 17% to 86,202, and growth has continued into 2017, with first-quarter true fleet registrations up almost 8% year-on-year.

BMW has worked hard to create a product line up that appeals to fleet decision-makers and company car drivers alike, which includes simplifying its trim line-up. Gone is the fleet-targeted Business Edition, made obsolete by the improvements in standard equipment at entry-level. 

Its challenge now is to improve driver and fleet awareness of the vast and growing array of technology embedded into each car. This was recently brought into sharp focus for BMW Group UK general manager corporate sales Steve Oliver in conversation with a fleet customer.

“He said that BMW’s best-kept secret was the usability of its technology – that’s something we have to address to make it more widely known,” says Oliver, who was appointed in December 2016.

Fleet News: Six months in, what’s your assessment of the BMW fleet business?

Steve Oliver: I expected it to be a strong, robust organisation and that’s there every day – it’s reassuring. With the volume we are delivering, there is not a mass of things that requires big change. We just have to refine what we do as the market moves.

FN: What key refinements need to be made?

SO:  One example is the company car driver experience. We are looking at how we develop the in-retailer experience and how we measure it. We have a cross-functional team with people from different departments to take a rounded view on how to improve the experience. Across the industry, many company car drivers go to the retailer and pretend to be a retail customer – from my point of view, that’s not acceptable. So we are looking at standards, measurements and how we tailor the online offering. 

We have the virtual handover with click and watch ; for any company driver that’s a massive benefit. Also from a fleet manager perspective, you can ensure a proper handover and all the safety features can be understood and used properly. In a world where the fleet manager can’t necessarily facilitate that, we can help.

We aspire to be the best fleet brand which means the experience for the fleet manager and how they are informed and how we listen. Because of our success in recent years, our business has a better understanding of corporate than even two years ago. 

FN: Where do you see the opportunities for growth in the fleet sector?

SO: We have clear channel split: key accounts and public sector; leasing; SME programme with retailers; and specialist sales function (rental, chauffeur, diplomatic sales). The market is challenged, but I see lots of opportunities to talk to new people. There will be growth in our SME programme – it increased by 20% last year – and we can do a better job looking after the local business person. Also, there is more scope with larger corporates. Leasing is increasing nicely and the public sector increased by 25% last year. We have taken a different approach here. Previously it was through one person but that was not feasible so now public sector is spread across the wider key account team. We have the right products with our iPerformance range, especially i3e with NHS trusts and public authorities, for example. We see growth continuing this year.

The market will have a bit of a pause with the election but it will be reasonably strong for the rest of the year, especially for premium brands. The UK is a premium brand market; we see corporates increasingly moving in this direction.

FN: What about Mini and the cross-sell opportunities?

SO: We are starting the journey in corporate sales with Mini. We have a job to do but now we have clarity of product range, including a plug-in Countryman coming this year. For some fleets, it is a no-brainer to look at both brands. People want to explore Mini more. It fits well now we are in different parts of fleet – it gives a real alternative. We do long-term loans; the impact of seeing a Mini in the car park with a business specification works really well.

FN: Last year you increased rental sales by 20% to 14,000 units; in the first quarter this year, volumes have remained static on 2016. How does rental benefit BMW?

SO: We set internal targets and we cap rental. We are fixed on our rental partners and they are focused more on B2B. So we see rental as 400,000 test drives last year. It’s about balance – we have a sustainable and disciplined approach.

FN: With so much of the fleet sector dominated by diesel, how is BMW reacting to the current emissions debate?

SO: The media reaction to diesel is the biggest surprise I’ve had ; it gained momentum more quickly than I thought it would. There is a pressure point: we are seeing more interest in our petrol and plug-in hybrid range. I see cars as a corporate focus. We have talked to our retailers about how iPerformance needs to mean as much as M Performance. M delivers a massive halo for traditional company car drivers, but with iPerformance we can make real inroads. With the diesel-petrol debate, we can feel confident that we have the products to match the marketplace, and we can increase supply to mirror demand. We have put on more iPerformance demonstrators than before but we have reasonable lead times because demand is so strong. But with that comes responsibility: we have to make sure we advise on the right model and powertrain to suit the company car driver’s requirements. There is less focus on Euro 6 diesel versus older cars or trucks but fleet managers are professional enough to know the story on Euro 6.

FN: The leasing sector has major concerns about connected cars and data ownership. How is BMW addressing those concerns?

SO: We have good data share with leasing; we have agreements with many of the top 50 leasing companies on data share that they are happy with. It’s the customer’s data so with the leasing companies we have been open and looked to facilitate, not control. There are collective benefits for leasing companies. Their customers want it – we know from feedback that connectivity in our cars is seen as a major positive, for example, real traffic updates for a company car user is a real bonus.

We supply with information on ongoing maintenance issues, for example, tyre problems that the driver is ignoring. From a CSR view, that’s a bigger, holistic view for the company car driver. They do high mileages in a stressful job so if in partnership with the leasing company we can find a way to enable safety-conscious decisions to be made, such as maintenance done earlier, that’s a great thing. I sense that the leasing companies we speak to appreciate our front-foot approach. Despite its sales successes in fleet over the past few years, Oliver is determined there will be no room for complacency. 

“We have to improve dialogue and listen to what people want,” he says. “We have to raise our profile as a corporate team, for example, talking to the product guys on WLTP . We are trying to shape our future to have the right products for the market.”

Oliver adds: “We have set a clear direction with our team and our retailer network.”