FleetCheck claims car and van maintenance extensions being refused

FleetCheck is reporting that some vehicle leasing companies are refusing to extend maintenance packages when cars and vans are taken beyond their initial contract into a fourth or fifth year.

Peter Golding (pictured), managing director at FleetCheck, says that, while the practice was not widespread, it was certainly taking place and creating significant problems for some fleets.

“Ongoing production issues mean that many fleets can’t get hold of the new vehicles that they need and so are extending their current leases well beyond the original three- or four-year termination point,” explained Golding. “This has been going on for some time.”

However, he said: “We are now hearing some reports from within our user base of leasing companies extending the car or van but refusing to do the same with the maintenance element.

“To some extent, this is understandable – once a vehicle is out of warranty and heading towards a six-figure mileage, maintenance costs both increase rapidly and become less predictable – but it does leave those fleets high and dry.”

Golding says that, because the fleets in question habitually bought maintenance packages with their lease, they tended to have no arrangements for buying their own servicing in place.

“This is a double-edged problem,” he continued. “These businesses need to quickly create a structure for maintaining the vehicles in question while, at the same time, they lose the certainty of a fixed monthly maintenance cost.

“They may well find major bills arriving for items such as cambelts or a complete set of tyres that is massively in excess of what they are used to paying to keep their vehicles on the road. It’s quite a financial and managerial shock.”

There were no easy answers for businesses in this situation and it once again showed how difficult the effects of new car and van shortages could be, he added.

“Production delays are causing many kinds of issues, from slowing down electrification to service and maintenance conundrums of this kind,” he said.

“It really would help fleets if the supply situation started to markedly improve in 2023, although there are mixed reports about how likely that might be.”

FleetCheck’s insight comes as Epyx report that reduced new car supply and contract extensions have resulted in the proportion of service, maintenance and repair (SMR) spend increasing on fleet cars aged four years old or over.

Analysis by Epyx shows that it has increased by more than a half since the pandemic, rising from 28% in 2018 to 43% in 2022.

Furthermore, Epyx says that the average SMR invoice price for those older vehicles is 24% higher than for those aged below four years.