THE outbreak of Covid-19 was disastrous for many businesses in the vehicle leasing industry. Companies closed their sales departments and orders ground to a halt as car factories temporarily shut down their operations.
However, some firms, such as Silverstone Fleet Management, have seen their business increase dramatically in recent months by responding to the demands of a changing market.
Managing director, Scott Norville, reflects on the changes the industry has undergone in the past six months and how firms should respond to a second wave of Coronavirus:
“For many firms in our industry, the first wave of Covid-19 was like Armageddon. Companies, like ours, had just emerged from a roaring start to the year but the accompanying euphoria quickly came crashing down with the outbreak of the pandemic and lockdown. Dealerships were closing everywhere and the finance providers our clients rely on downed tools.
“The outbreak couldn’t have come at a worse time; coinciding with the move from the old Co2 targets to the new stricter Worldwide Harmonised Light Vehicle Test Procedure (WLTP) targets for fuel consumption, Co2 emissions and their pollutant emissions at the beginning of April.
“The change meant many vehicles moved to a higher rate of road tax and as a result huge numbers of clients clamoured for their vehicles to be delivered by 31 March – ahead of the change. Throughout the UK lots of cars were on order to hit this date but then things came to a standstill with Covid-19. The situation is starting to right itself now however, for months the situation created a backlog and delays for customers.
“Happily, we’re gradually beginning to see the industry bounce back, particularly in relation to decisions from finance providers. At the beginning of 2020 they were giving clients decisions about credit within minutes – even in incidences where credit needed to be underwritten you could probably expect a decision within three to four hours.
“When Covid-19 hit those same decisions began taking five to six weeks which caused huge delays. Thankfully, decisions have started to come through quicker again however, during that difficult period it was imperative that we in the industry managed our customers’ expectations accordingly.
“At Silverstone we kept talking to our clients throughout lockdown and used social media effectively. We posted a series of heartfelt LinkedIn videos about our experiences which resonated with customers and the wider business community and further strengthened our brand awareness. With possible future lockdowns on the horizon, I’d urge industry colleagues to ensure they maintain regular contact with their clients as that’s part of the reason we’re in a strong position when other firms didn’t survive the first wave of the crisis.
“Although 2020 has been a tough year for our industry there are opportunities to be seized. Following on from the introduction of WLTP we’ve seen electric vehicle orders increase by 85% during August and September compared with the same period in 2019. Overall, we also saw our orders increase by more than 60% at the end of the summer for various reasons.
“More people are keen to swap public transport for hire vehicles because they see them as more hygienic. Clients are also increasingly preferring to access our online services and Covid-19 secure delivery as opposed to visiting traditional dealerships which rely on a face-to-face service.
“Previously, many clients were leasing premium band vehicles with an average mileage of 15,000 a year. Now we’re seeing more orders for smaller cars with an average mileage of 5,000 a year because lots of people are continuing to work from home. If our industry keeps responding quickly to our clients’ changing needs our businesses should be able to meet the challenges posed by a second wave of Coronavirus head on.”