THE CONTINUING vehicle supply disruption to the fleet sector is restricting business growth.
Reporting in the latest Business Impact Survey, the majority of BVRLA members listed supply issues as their primary concern, while 71% say lack of vehicle availability will negatively impact future performance.
Conducted at a time when the automotive supply chain is feeling the combined effects of the semiconductor shortage and war in Ukraine, the latest survey shows that vehicle availability is as bad as it has been since the pandemic, with lead times of up to a year now the norm for all vehicle types.
The knock-on impacts of extended lead times include vehicles being held on fleet longer with associated rise in maintenance costs, as well as customer expectations not being met as greater compromises are required to keep them mobile.
The supply chain challenges that beset our industry show no sign of abating, and their impact on the fleet sector is being amplified by manufacturers prioritising other channels. This short-sighted approach will cause broader issues across the industry. A healthy fleet sector brings stability through long-term contracts, while accelerating the adoption of new technologies and bringing cleaner vehicles to the UK’s roads.
Gerry Keaney, chief executive, BVRLA
Dylan Setterfield, head of forecast strategy at cap hpi, said: “There has been a significant distortion in the new car market in recent months. Manufacturers have clearly been prioritising retail over all forms of fleet, and if you look at Q4 last year, retail was only down 1.3%, but over the same period fleet registrations were down 41.3%.”
While the uncertain situation is a widespread concern, the sector does present a variety of solutions that are keeping drivers on the road. Flexible rental options – particularly on vans – have seen significant uplifts in demand, with salary sacrifice, Business Contract Hire and used car leasing also growing in popularity as driver perceptions on mobility evolve, reported the BVRLA.
Lee Jones founder of the vehicle purchasing system Fleet Procure for brokers and dealers added:
Leasing brokers will always weather these kinds of storms better. This is because we are monthly payment driven and brokers are more agile, quicker to react in the market, and able to deal with all brands and OEMs.
Automotive and fleet writer for Broker News
