The Car and Truck Fleet and Leasing Management Magazine

Why “Fleet” Remains Vital To Our Industry Suppliers

June 2002, by Ed Bobit - Also by this author

No man fears what he has seen grow. - African Proverb

You must grow like a tree, not like a mushroom. - Janet Erskine Stuart

What grows makes no noise. - German Proverb

You've got to do your own growing, no matter how tall your grandfather was. - Irish Proverb

 

Most of you know that the automotive market was humming last year. In fact, overall it was the second highest volume year in history without being record-breaking.

"Fleet" also accounted for their share with a current new high volume of vehicle purchase of 2,814,000. That equates to nearly 17 percent of all sales for cars, light trucks, vans, SUVs, and medium trucks.

Further inspection of the new registration figures for calendar 2001 shine light on some interesting insights.

During the first three quarters of the year, most of the domestic manufacturers were shouting about reducing their sales to rent-a-car companies so that shareholders knew that the focus was on commercial (more profitable) sales within "fleet."

Then, 9/11 hit us all and the rental firms de-fleeted (and overly de-fleeted in many cases) so that the fourth quarter was virtually without any daily rental sales. The wailing could be heard everywhere.

For the official record, rental vehicle sales were only down about 13,000 (1,813,501) for the year. A slightly different view that we were led to believe.

Now, more analysis, if you can stand it. Looking specifically at the commercial" segment that combines "Leasing" registrations (by major fleet lessors), and that also includes 'Utilities," it was another good year for fleet.

"Cars" pretty much held their own in volume compared to previous years. The significant increase came with "Trucks" for new registrations; up 5.5 percent for a total new fleet truck record of over 780,000.

Placing the fleet contest into perspective, GM is touting fleet sales as 26 percent of all GM sales. This is a current history high with claims of leadership in some segments. Ford remains strong with nearly 32 percent fleet share of Ford's total sales. This is a current history high with claims of leadership in some segments. Ford remains strong with nearly 32 percent fleet share of Ford's total sales. It's very competitive out in the marketplace.

While these numbers signify a robust market, particularly in the commercial sector, there are notable weak spots and changing practices. The telecommunication companies are delaying replacement markedly. Some firms are imposing stricter eligibility rules to qualify for a company vehicle. Others are extending the operation cycle. Mergers and acquisitions continue to reduce the combined sales forces.

In summary, "Fleet" continues to be integral part of the manufacturer's marketing plan. The top execs at the automakers are giving respectful recognition to the fleet sector and know its value. Add the predictable competitiveness among the makers for their market share and it still looks like a good year for us in 2002.

 

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