The Car and Truck Fleet and Leasing Management Magazine

Ford's Global Fleet Solutions Sees Rapid Growth

March 6, 2007

DEARBORN, MI -- As the business world continues to globalize, Ford's Global Fleet Solutions (GFS) offers one-stop shopping to some of the world's biggest corporations.

Designed to work with multinational companies who are looking to consolidate and leverage their international fleet purchasing power, GFS is made up of representatives from all of Ford Motor Company's Trustmark brands (Ford, Volvo, Jaguar, Land Rover and Mazda) from every geographical region around the world.

"We are the place where all of our Ford Motor Company brands work together as one unit and speak to the customer with one voice," said Jeff Nichols, Ford's Global Business Development manager. "We are very attractive to fleet buyers because of the breadth of our portfolio and the depth of our experience."

Ford has been in the fleet market for as long as the fleet business has existed. But while fleet deals were initially targeted to individual countries, over the last few years they have become much more global in scope. Even as recently as three years ago, the majority of fleet business was regional in nature.

In 2003, only about 20 percent of GFS business development was global; today it's 50 percent. Regions like Asia-Pacific, Latin America and Mexico have been major beneficiaries of that global acceleration.

The real growth began after the Sept. 11 terrorist attacks in the United States.

"The economic downturn that followed the attacks led fleet buyers to look more closely at their costs," said Nichols. "As companies sought fresh ways to control expenses, global procurement took on a new dimension."

GFS currently manages more than 207 global accounts like IBM, FedEx and Tyco, accounting for more than 900,000 vehicles. Interest in GFS has doubled in the last three years. In 2003, there were 55 requests from multinational companies for quotes; last year, there were 110.

In the case of one multinational pharmaceutical conglomerate, GFS was able to reduce the number of vehicle manufacturers from 44 to two with Ford Motor Company as the chief supplier and Nissan-Renault as a secondary.

In Europe, 40 percent of all vehicle sales are purchased by companies or corporations. About half of those vehicles are for employees as part of their compensation. The system goes back to a time when governments were heavily taxing incomes. To help reduce the workers tax burden, many companies began supplementing wages with cars. In the years that followed, even as tax rates modified, the company-vehicle as a compensation perk remained in place.

In some European companies, fleet requirements for premium or executive vehicles can be as high as 30 percent.

"Our range of products worldwide includes Ford, Lincoln, Mercury, Volvo, Land Rover, Jaguar and Mazda. That's a portfolio no other manufacturer can match," said John Wright the global fleet manager for Jaguar/Land Rover. "Not only can we offer everything from entry-level vehicles to mid-size vans to heavy-duty trucks, we can offer legendary high performance premium vehicles as well."

Lianne Daly, Ford of Europe's business to business sales operations manager, says she is seeing increased sales momentum thanks to Ford's recently launched vehicles that feature the company's new kinetic design language. They include the new Galaxy, the SMAX, which was voted the 2007 International Car of the year and the Transit which was voted the 2007 International Van of the year.

"The new sexy products coming through have really been a great motivation for our sales team, said Daly. "We've always had a good story to tell based on more rational factors, such as value for money, product quality and driving dynamics, but now we have a range of vehicles with real emotional appeal that drivers want to be seen in."

For automakers, the corporate fleet business has always been more advantageous than rental car fleets. Unlike rentals, which are driven for less than a year and then put on the used market, corporate vehicles are normally leased/purchased for three years. Approximately 30 percent of those cars and trucks end up being purchased by the employees when the lease is up.

According to Nichols, no matter who negotiates the contract for a multinational fleet, it's ultimately the desires of the drivers that percolate back up the corporate ladder and influences that company's vehicle decision.

"The world over, no matter what country you go to, a vehicle is an emotional purchase," said Nichols. "People are very concerned about what they drive, and worldwide, we're the only company that offers this kind of choice."

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