How are fleet manufacturers meeting the challenges of Covid-19? Kia responds

In May and June, Fleet News surveyed all the major manufacturers to find out how they were responding to the coronavirus pandemic, how they are supporting their fleets customers and their views on the type of impact it would have on the fleet sector.

The resulting article was published in the June edition of Fleet News.

Fleet News spoke to John Hargreaves, Kia's head of fleet and remarketing (answers as at 4/6/20)

How are you and your team staying operational in times of Covid-19? 

Very effectively with good levels of phone and Zoom customer meetings. We have continued prospecting activity and I believe in general we will emerge from the crisis in a strong position.

What action are you taking to support fleets during the Covid-19 crisis?

We have maintained contact where possible with our fleet customers, in cases where customers have needed to extend demonstrations, we have obliged. In cases where fleets have been unable to take contracted volumes of vehicles, we have been flexible.

What proportion of your retail network remained open for SMR business?

During lockdown, we had a skeleton network for SMR.

Will Covid-19 have a bigger and longer lasting impact on our industry than the financial crisis in 2008?

This will depend on the time frame – in the short term, the impact will be pronounced but the economy should recover.

There are variables which are impossible to predict – if there is less travel and more home working, the demand for all forms of transport is bound to be impacted. However, in the case of private cars, there could be a compensatory effect of less willingness to use shared space (public) transport. 

How much of a decline in total market fleet sales are you forecasting this year?

It depends on the segment – rental is certain to be very hard hit, Motability I would see as recovering quickly.

Mainstream fleet I would see somewhere in between – probably some initial delays of purchasing decisions but recovering in the third and fourth quarters. Clearly though, we are not immune from the effects of a general economic downturn.

Please outline your exit strategy and how you believe the way business is carried out in future might change – the so-called ‘new normal’.

Initially, we will expect less face to face contact and we will adapt to that. However, cars are physical items and I expect our customers will still want to see and drive them in the ‘flesh’ – fleet has always been a contacts and people part of the industry – I expect this to continue even if in the first few months we see customers on screen rather than in their office.

Will we experience a break on the development of MaaS and fleet electrification?

I think Mobility Services will have a pause – the appeal of shared space travel of all types will reduce in the short term. I would see no real reason for the electrification of cars to change though.