In the spotlight: BVRLA

Gerry Keaney has big shoes to fill. As the new chief executive of the British Vehicle Rental and Leasing Association (BVRLA) he replaces a man who became almost synonymous with the organisation after close on 13 years in the role.

John Lewis is rightly credited with turning the BVRLA into the strong, relevant and professional trade association it is today.

He grew membership (now 600), strengthened the committees and set up numerous working parties to ensure members’ views were being accurately represented.

He also pushed hard to have the BVRLA’s voice heard in the Westminster corridors of power during a period when policy seemed to frequently put the Government on a collision path with leasing companies and fleet car drivers.

At a time when many motor industry associations have seen a revolving door of chief executives, Lewis’s term of office shows a rare level of commitment. It created stability.

Big shoes indeed.

Keaney shows few signs of being overawed by the challenge. This former Volvo Cars vice president of marketing and sales has seen most things during his long motor industry career.

He arrived at the BVRLA buoyed by positive preconceptions based on his experiences of dealing with leasing and rental companies as a supplier of cars with Volvo.

“I always found them to be professional companies, with a sense of innovation in the services they supplied to their customers,” Keaney tells Fleet News in the BVRLA’s Amersham offices.

“But they were tough to negotiate with and very direct and straightforward in their expectations.”

Those initial impressions have proved to be accurate, perhaps even more so as the sector gradually exits the difficult post-recession economic environment.

He adds: “The economy is critical and it has created a keen sense of competition, which means strong products and services.

"It has its cost on business, but it also leads to innovation for the customer. It adds value, carves out niches and is about doing more for less.”

Keaney is just three months into the role and is yet to set out his strategic plans for the association.

He has ideas already but isn’t going to share them in detail just yet; they first need to be discussed and sanctioned by members.

However, he does believe that, for all its size and importance to the wider economy, the leasing and rental sector does not enjoy the right share of voice or level of profile.

He describes it as “a big opportunity”, but adds: “It is also true that we didn’t have the right building blocks available to us; a foundation to increase our share of voice.”

Lewis had already started to address this issue, commissioning reports such as the recent Oxford Economic research, which revealed the financial importance of the sector, and the TRL daily rental report into the benefits of car hire versus ownership.

Additional research into industry data will further equip the BVRLA with the knowledge and insight it needs to strengthen its lobbying might and elevate its profile.

It’s a two-pronged approach, according to Keaney: first, to communicate the industry’s importance to government, funders, manufacturers and other relevant parties.

And second, to enable the association to have a viewpoint and to create policy that will shape its agenda for the coming years.

“We are in the midst of agreeing that agenda with our members, for example, on the environment, taxation and red tape,” Keaney says.

“This is something that will happen over the next few months.”

Does he agree with the assertion of new BVRLA chairman, and Marshall Leasing managing director, Peter Cakebread that the association needs to punch above its weight in government circles?

“I’d be happy in the short-term if we punched our weight in terms of share of voice,” comes the reply.

“But we have started the process by establishing an impressive body of data which shows the wider economic impact, including the number of jobs that rely on this sector and our members.”

Keaney’s immediate priority is to improve understanding among members of the products and services the BVRLA already offers to boost take-up.

Key among these are the educational training programmes and seminars. “For example, our recent RV seminar had 70 people but more should’ve been there. It’s an added value event and a networking opportunity with a cross-section of the industry, from suppliers to leasing and daily rental.”

Keaney adds: “I’d like to see us regarded as the trainer for products and services. We would have to work with partners but it could be a service for members and non-members.”

His medium-term objective is to harness the knowledge and expertise among the membership to facilitate sharing and learning.

“We have 600 members and 2.8 million vehicles on the road. They have extensive knowledge of customers, the market, what’s moving, etc. There’s a lot you can learn if this is packaged and spread more widely.”

The longer-term policy outcomes are likely to be fewer in number but more focused and better resourced.

Keaney stresses that the association has been “very successful in what it’s doing now”, but he wants to position the BVRLA as the voice for everything that happens in the leasing and rental industry.

And he wants to take a proactive stance, rather than reacting to issues.

“For industry and government, there will be an understanding about what the BVRLA’s view is on any issue. They will also understand that the BVRLA speaks on behalf of a membership group that has a significant impact on the UK economy.

“That isn’t the case today. We provide an excellent response to what’s going on, but we need to establish ourselves as thought leaders.

"We have to make our case as straightforward and data driven as possible and do it as early as possible in the decision-making process.”

As an example, Keaney points to the power transfer of the regulator Financial Services Authority (FSA) to the Financial Conduct Authority (FCA) four months ago.

“What does this mean for our members?” he asks. “The FCA is clear in terms of what they want to achieve but they are not specific on our sector so we have an opportunity to work with them to explain how we believe their aims can be met.

“We have an excellent code of conduct to demonstrate to the FCA that we take regulation seriously. There was a fear that the sector would get the heavy hand of regulation rather than the light touch.

"Our policy team has done an excellent job persuading them to give us the lighter touch.”

Is he pushing the FCA to adopt the BVRLA’s mandatory code of conduct rather than develop its own framework?

“The FCA has a tremendous amount of work to do in finance and leasing.

"It’s part of our job to demonstrate to them and persuade them that we have the potential of a very strong regulatory regime already. We have the foundation for going forward.”

It’s not a direct ‘yes’, but the inference is clear: an established process exists; the FCA would be advised to adopt it.

The polar opposite example of proactive action came with the announcement in the 2012 Budget that leasing companies would no longer be able to take advantage of the 100% writing down allowance for low CO2 vehicles.

The decision caught many on the back foot and lobbying for a reversal took time to rally.

“That battle is lost, but it’s still important to communicate to government that to pursue a green agenda in this sector, we are a key enabler,” Keaney says. “We have to be a partner in discussions.”

He adds: “I’m very optimistic that when we present to government, there will be a willing ear to listen.

"If we can achieve clarity and understanding around our policy agenda and what we stand for, then we have the ability to punch above our weight.”

Members ‘in a positive mood’

Leasing

“The economic environment is very important in driving their business. We still see growth because of the advantages of leasing. The products are very sophisticated that meet specific requirements of the customer base.

“They are generally in a positive mood: the sector is continuing to grow. Used car residual values are strong and those that did have constraints on funding have new entrants in the market injecting capital. Their fears are alleviated; cost of funding is still very competitive.”

Rental

“This sector is also in a positive mood. They are seeing high levels of utilisation and some are seeing growth.

“Rental is a significant sector and purchaser of cars. It employs a lot of people and offers a cleaner, more sustainable fleet. It takes cars off the road and is part of an integrated transport policy; there are often two or three people in a rental car.

“But there’s not enough credit for its role. We see a lot of negative stuff in the press but there’s a positive story – 95% of customers have no problems, especially operationally - and we have to get the message out there.”

Factfile

Founded 1967
Chief executive Gerry Keaney
No of members 600

Sector

Employs 38,000 people
Indirectly supports 184,000 jobs
Fleet size 2.8 million vehicles
Direct contribution to GDP £8bn