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Increased termination fees highlights the cost of Covid-19

Research commissioned by Europcar Mobility Group in August 2020 found that 52% of fleet manager admitted that they have had to pay increased termination fees. With economic uncertainty continuing well into 2021, an optimised vehicle fleet that can be changed as requirements vary will be key to ongoing success for many businesses
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January 18, 2021

FLEET managers have had to review their fleet acquisition policy as a result of the pandemic and the financial impact of COVID-19 has caused many to pay increased termination fees on leased vehicles.

Research commissioned by Europcar Mobility Group in August 2020 found that 52% of fleet manager admitted that they have had to pay increased termination fees. With economic uncertainty continuing well into 2021, an optimised vehicle fleet that can be changed as requirements vary will be key to ongoing success for many businesses.

Europcar said flexible long-term rental addresses this need, providing access to a range of up-to-date vehicles but without the need for a long-term financial commitment.

Another challenge for fleet managers is vehicle supply, with the ‘perfect storm’ of COVID-19 and Brexit having a severe impact on access to new vehicles.  Indeed, the Europcar research found that 62% of fleet managers had to extend existing contracts in 2020 due to issues with supply of new or replacement vehicles. And this situation is likely to be exacerbated in the early part of 2021.

At times when supply lines cannot be guaranteed, vehicle hire is a cost-effective way of plugging the gap and allowing companies to utilise safe, well maintained vehicles with the minimum of disruption to their day-to-day business.

 

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Chris Wright

Chris Wright

Chris Wright has been covering the automotive industry nationally and internationally for 30 years. Following spells with consumer titles he became News Editor of Automotive Management (AM), Editor of Automotive International, International Editor for Detroit-based Automotive News, and Editor of Dealer Update. He has also co-authored several FT Management Reports and contributes regularly to Justauto.com

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