Fleet Management Category Intelligence
Report Coverage
- Technological Trends
- Supplier Analysis
- Supplier Profiling
- Best Practices
Production Size
Production Size North America
10 Mn Units
Production Size Europe
10 Mn Units
Production Size Asia Pacific (APAC)
16.03 Mn Units
Fleet Management Market Overview
The market trend of fleet leasing is high among areas such as Europe and North America, however, purchase is the preferred model in APAC and LATAM, even though large companies in these regions are moving towards leasing. The growth of global fleet management market is driven by factors such as centralization of fleet sourcing and management, a decrease in the sale of diesel vehicles, risk and safety factors, driverless/self-driving vehicles, increase in mobility budget, a shift towards alternative fuel vehicles, and an increased focus on mobility management.
The report also includes key drivers and constraints of the global fleet management industry, followed by a regional market outlook in areas such as North America, Europe, and the APAC. It also explores various opportunities and challenges faced by key demand markets, along with Porter's five forces analysis. It also provides an outlook over key suppliers such as ALD Automotive, Arval, LeasePlan, Wheels Inc., and Orix. The report also gives an overview of industry best practices, procurement best practices, followed by a comprehensive analysis of the cost and price trends.
In a fleet management model only, the buyer owns the vehicle fleet and outsources its management to a fleet management company. Since the fleet management company (FMC) does not invest in vehicle fleets, it does not incur any capital cost or financing cost. Cost of capital/finance and maintenance together contribute to 60 percent of the supplier’s cost. Dry operating costs account for nearly 90 percent of FMCs’ fees. The maintenance management costs, administration expenses, license and permits account for nearly 80 percent of FMCs’ fees. For certain situations, the FMCs provide assistance to their buyers for their financing needs and arrange financing from a third-party financial institution/bank. In this case, the FMCs earn a 1–2 percent financing markup.
Beroe gathers intelligence through primary sources that include industry experts, researchers, and consultants, as well as current suppliers, producers and distributors. Secondary sources can include business journals, newsletters, magazines, market research data, company sources, and industry associations. Following data collation, analysis, and strategic review, the Final Research Report is published on Beroe LiVE.
Fleet Management Market Trends
Category Intelligence on Fleet Management covers the following
- Information relating to market, supply, cost, and pricing analysis
- Hard to find data on cost and TCO models, supplier details, and performance benchmarks
- Macroeconomic and regional trends impacting cost, supply, and other market dynamics
- Category-specific negotiation and sourcing advice
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Industry Outlook & Drivers
Fleet Management Market Analysis and Global Outlook
In 2016, global passenger car sales were close to 83 million units, and they are expected to grow at ~2.5 percent to reach ~ 85 million units in 2017. APAC will be leading the growth of automobile sales.
The KPIs in the fleet management industry are: Vehicle ordering, operational and consolidated reporting, service maintenance and repair, driver program, accident management and insurance support and cost savings. The major fleet management trends are: Centralization of fleet sourcing and management, data management and reporting, driverless/self-driving vehicles, mobility management, focus on risk and safety (vehicle and driver). Key components for contract structure in the global fleet management market are: Leasing, fuel management, maintenance, accident management, and administrative cost. Fuel, cost of capital/finance and maintenance all together contribute to 75 percent of the leasing supplier’s cost in the fleet management market.
BREXIT –Impact on Fleet Leasing and Management
Increase in Fleet Leasing Cost Lease price is majorly dependent on MSRP of the vehicle and residual value. Though the impact of Brexit was negligible in 2016, exchange rate of Pound is expected to remain low in 2017. As a result, MSRP is expected to go up and so does the lease price.
Action Item
- Buyers can focus on consolidating their fleet spend and obtain the best discount possible in the market to reduce the impact.
Increase in Fleet Management Costs
- Fall in the exchange rate of U.K. pound has resulted in higher fuel prices and has lead to higher fleet management costs.
Action Item
- Companies can use this opportunity to explore fuel reduction techniques, reviewing fuel reimbursement rates and adopting high mileage vehicles in the fleet.
Fleet Management Global Market Maturity
Fleet leasing is high among the companies in North America and Europe. Though purchase is the preferred model in LATAM and APAC, large companies in these regions are moving towards leasing.
Fleet Management Global Drivers and Constraints
Buyers having global presence, increasing sales force and benefits of outsourcing non-core functions are driving the fleet leasing industry. However, alternatives to travel, like video conferencing, and alternatives to company cars, like car sharing, are some of the constraints.
Outsourcing benefits cost control
- The buyers outsource the car leasing and fleet management services to reduce the administrative overhead and to achieve cost benefits. Moreover, the fleet is one of the major spend areas, and buyers prefer outsourcing the fleet management functions to focus on their core business functions
Global presence and scalability
- Buyers with a global presence and higher mobility of their employees prefer outsourcing fleet management services to manage the increasing fleet size
Sales force
- An increasing sales force that requires mobility solutions results in increased fleet size, which drives the fleet management industry
Video conferencing and webinars
- With the advent of new technology like live webinars and video conferencing, it is possible to conduct online meetings and sales presentations, reducing the travel time and cost
Support network
- The usage of support networks like insurance, maintenance, servicing, and remarketing that are required in this industry is high and acts as a constraint to manage these small support service providers
Alternate strategies
- The use of alternate techniques, such as car sharing and carpooling, reduces the number of vehicles in use
Why You Should Buy This Report
The report provides information on major fleet management industry trends, drivers and constraints and the regional market outlook of APAC, Europe and North America and Porter’s five force analysis of the global fleet management market.It gives insight into supply trends and does a SWOT analysis of major suppliers like Arval, LeasePlan, Wheels Inc, etc. It breaks down the cost structure for different fleet management models and compares the best sourcing, pricing and contract models.
Fleet Management Frequently Asked Questions
- How is the fleet management market in different regions across the world?
- Fleet leasing is most preferred in regions like Europe and North America, while in APAC and LATAM, purchase is the preferred model. Several large companies in these areas are shifting towards the leasing model, but the purchase model remains unaffected.
- What are the factors driving the growth of the global fleet management market?
- The factors driving the growth of the global fleet management market are as follows. · Centralization of fleet sourcing and management · Decrease in the sale of diesel vehicles · Risk and safety factors · Driverless/self-driving vehicles · Increase in mobility budget · Shift towards alternative fuel vehicles · Increased focus on mobility management
- What was the expected growth of global passenger car sales in 2017?
- From Beroe’s fleet analysis market reports, the global passenger car sales were expected to grow at 2.5 percent to reach 85 million units from the past sales of 83 million units in 2016.
- What are the major KPIs in the fleet management industry?
- The major KPIs in the fleet management industry are vehicle ordering, operational and consolidated reporting, service maintenance and repair, driver program, accident management, and insurance support and cost savings.
- What are the key components for contract structure in the global fleet management market?
- Leasing, fuel management, maintenance, accident management, and administrative costs are the key components for contract structure in the current fleet management industry trends.
- What are the key cost components in the fleet management market?
- As per the fleet management cost analysis, fuel, cost of capital/finance and maintenance are the key cost components that contribute to 75 percent of the leasing supplier’s cost.
- Which regions across the world have high and low market maturity?
- North America and Europe have high market maturity regions, while LATAM, Africa, and APAC are the regions with low market maturity.
- Who are the key players in the global fleet management market?
- Global Fleet Services, Volkswagen Financial Services, ALD Automotive, Arval, LeasePlan are the key service providers in the global fleet management market.
- What was the impact of BREXIT on fleet leasing and management?
- The increase in the fleet leasing price is dependent on the MSRP of the vehicle and residual value. After the BREXIT in 2016, the exchange rate of the Pound was expected to remain low in 2017. Consequently, the MSRP was expected to witness a rise along with the lease price.
- What opportunities does the fall in the exchange rate of the Pound present?
- Due to the fall in the exchange rate of the Pound, the fuel prices went up leading to higher fleet management costs. Companies can use this opportunity to explore techniques for fuel reduction, review fuel reimbursement rates, and adopt high mileage vehicles in the fleet.
