Mazda Motor Europe’s announcement last month that it plans
to “expand its pan-European fleet” business is likely to mean
plenty of more business for its contract hire and fleet management
partners.
It also brings to the forefront the
issue of the future of back-to-back funding generally across motor
finance.
Go deeper with GlobalData
Lex Autolease, Mazda’s main fleet
leasing partner for the last four years, is most likely to benefit
from the Japanese car manufacturer’s fleet expansion plans.
According to James Hopkins, director
of European fleet operations at Lex Autolease, Mazda’s UK fleet arm
also has “very good relations” with around 25 of the UK’s largest
motor finance companies, while across Europe it partners with the
likes of ALD Automotive, Arval, and LeasePlan.
All these lessors could benefit from
Mazda’s fleet growth plans which, the company hopes, will take it
from being a predominantly UK and Dutch fleet player into a truly
pan-European one.
Hopkins hopes that over the next three
to five years, Mazda’s fleet business will grow by around 50%,
while he expects its relatively mature UK fleet business to grow at
a “slower rate”.
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By GlobalDataThis strong growth, which by Hopkins’
own admission is dependent on “market conditions” and maintaining
profitability, looks more than credible, particularly given Mazda’s
current smallish presence in the fleet market. Fleet sales account
for less than 15% of its European volumes, and in the UK the market
share of its fleet arm is around 1.8%, just less than half of what
it is for its retail business.
Leasing is also likely to play a
significant part in this growth. This is recognised by Hopkins, who
told Motor Finance that his company has “very strong
relations with the main contract hire providers”, and who also
remarked that of the operational lease fleet market in the UK,
Mazda cars represent around 3%.
No doubt Mazda plans to maintain
relations across a spread of contract hire providers. This
contrasts with its retail arm, Mazda Finance, which now partners
exclusively with Santander Consumer Finance after its relationship
with Ford Credit ended around 18 months ago.
Nissan has a similar set-up with the
bulk of its large fleet business going through one or more of the
UK’s top 50 motor finance companies, while its retail arm, Nissan
Business Finance, has a partnership with Arval (although, according
to Nissan, “there is no reason why Arval would not support us on a
much larger fleet requirement”).
This shows the emphasis some car
manufacturers make on using third-party leasing companies, partly
so they can focus on their own core business, and also as it helps
them grow quickly, particularly in new markets they are unfamiliar
with.
Arval already has positioned itself
well in this market, but as more car manufacturers seek
post-recession to enhance their retail or fleet arms, others might
well be looking to follow in its footsteps.
Brendan Malkin
