Fleet operators show growing interest in flexi-rent programmes

Flexible rental programmes offered by car manufacturers via their franchised dealers are increasing in popularity with business users.

Such programes offer fleets greater flexibility to add vehicles at short notice, to provide cover for temporary staff or for staff working probationary periods.

White Clarke Automotive Solutions provides the technology and support for Ford and Kia’s schemes, while also running similar programmes for General Motors overseas.

Head of operations Craig Godfrey told Fleet News: “I’ve been talking to other manufacturers and they’re very keen on offering these types of schemes.”

He believes there are several reasons for their increasing popularity among manufacturers and fleet operators: “For many, the flexibility of being able to change the vehicle if and when they change employee is invaluable as it has the potential to save money in the long-run.

“From the manufacturers’ point of view, if they experience a break-down or a warranty issue then it means that they can place their customer in a same-brand vehicle. This avoids the customer driving a rival manufacturer’s vehicle at a point in time when they might be temporarily dissatisfied.”

Graeme Banister, director of consulting for automotive and transportation at Frost and Sullivan, said these programmes offered fleets “flexibility” but they were “not the cheapest way of sourcing vehicles”.

“But for those companies that are growing quickly following the recession, they can provide a quick and simple way to provide a car or van to get a job done following a contract win,” he added.

“And if an employee is working a probationary period, then flexi-rent programmes provide an ideal way to get them in a vehicle for its duration.

"For companies that are looking to grow, flexi-rent schemes appeal because of their fixed cost – if they tie themselves in to a three- or four-year contract, then there’s also the wear and tear costs to consider.

“We live in an age where people want to change their mobile phone every six months when the latest model emerges – why not their car? I think that we will see more schemes of this kind. Ultimately, usability equals utilisation.”

Banister believes many manufacturers treat the vehicles that are placed in their flexible rental programmes as “dressed-up demo cars”.

Nick Halliday, manager of rental operations at Ford, said one of the company’s main aims in launching Ford Rental Flex last year was to ensure its corporate customers continued to have access to one of its own-brand vehicles.

“We like to ensure that our fleet customers have access to a Ford vehicle at every opportunity,” he said.

“We also want to ensure that if our corporate clients have peak workloads or want to run a pilot scheme, for example, and take on additional staff for a three-month period, then this is a straight-forward and cost-effective way they can put them in a new vehicle.”

He added: “We believe that there’s growth potential for the programme, but the key to its success is ensuring that dealerships are on board. At the moment, we have around 30 sites nationwide and we are aiming for 100% saturation.”

John Hargreaves, head of fleet and remarketing at Kia, launched a trial of its flexible car hire programme, Kia Rental, in March. It is now planning to roll it out to other dealerships. All models in Kia’s range are available with each dealer deciding which vehicles to add to their offering.

Hargreaves said: “We have 12 active sites, which is ahead of our initial expectations. We intend to expand the scheme to about 20 dealers in order to give better geographical cover.

“We’re targeting all types of rental opportunities – from retail to fleet. The fleet area is an important part of the business for Kia, and focusing on what our customers want and adapting to their needs is an important part of growing the business.”

Meanwhile, when Peugeot launched its mobility scheme, MU, in 2010, it was among the first manufacturers to do so.

Peugeot spokesman Kevin Jones said: “We’re now in a position to expand the MU scheme progressively during 2015 – not least through an enhanced website – as we better understand our customers’ requirements.”