Kia UK Ltd’s decision to pursue business as usual in the fleet sector during and immediately after the Covid-19 pandemic is continuing to reap dividends for the brand.
While other manufacturers scaled back fleet business to put a reduced supply of new vehicles into the more profitable retail sector, the Korean brand stuck to its strategy.
This saw it win new customers and become the UK’s second largest fleet brand in 2022 – a position it also currently holds this year.
John Hargreaves, head of fleet and remarketing at Kia UK Ltd, said: “We took the decision to maintain our fleet presence because it takes a long time to build up customer relationships and that paid major dividends.
“For most of the year we were the biggest fleet manufacturer and went back into second place towards the end of the year, which was absolutely fine.
“We did most of our volume in conventional corporate channels. We did some rental, but not very much, and in Motability we kept a similar sort of presence to what we would normally have.
“This year we are again number two in fleet. We are doing just about the same volume as we did last year, but others are doing more this year because people have gone back into fleet.
“We haven’t done a one minute we’re in, one minute we’re out. We’ve just kept in it, kept going at the same level and we’re happy with the stability we’ve provided.”
He added: “Probably 12 years ago our fleet share was less than 2%. Now it is 7%, so we’ve gone from being a significant minority player to being one of the major forces in it.”
Hargreaves said the fleet market is returning to where it was three or four years ago – pre-covid – with manufacturers trying to generate volume rather than control sales channels.
This – as AFP highlighted at the end of May – has also seen the return of manufacturer discounts, even to electric vehicles.
Hargreaves said: “We set out our discount structures at the start of the year, and very rarely do we drastically alter them.
“With small cars, and I mean vehicles like Picanto, we’re hardly discounting at all.
“Things like a standard petrol Sportage, we are doing fleet level discounts, perhaps not as high as they have been in the past but there is still a deal to be done there for the right reason.
“With electric cars, I would say small discounts, but if there’s an opportunity that needs a small bit of flexibility in an upwards direction, then we would do it.”
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Kia’s main EV volume seller in fleet is e-Niro – the Niro was named best lower medium car at the 2023 Fleet News Awards - but Hargreaves said its current order bank is still around half internal combustion engine.
HEV accounts for the majority of electrified powertrain orders, with PHEV and BEV about 14% of Kia’s existing order bank.
Hargreaves added: “Lead times are really good for us at the moment. Almost everything is on what I would call a normal factory lead time of three months.
“That would apply to e-Niro. EV6 will be a bit longer, as are PHEVs, but we’re in a good controlled position on the lead times.”
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Andrew Ryan is the features editor at Fleet News. He has been a journalist for more than 20 years and has specialised in the fleet industry for the past 12.
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