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This November Lombard
Vehicle Management (LVM), part of Royal
Bank of Scotland (RBS) won the Best Motor Vehicle Finance
Provider title at the National Association of Commercial Finance
Brokers (NACFB) awards. It is the second time in three years that
the company has won the award and prompted Adam Tyler, NACFB’s
chief executive, to tell Motor Finance: “The result was voted by
NACFB members and LVM won by quite a large margin, especially on
criteria such as speed of decision, appetite for risk and ease of
documentation.”
Gaining pole position amongst UK motor brokers is a significant
achievement, especially given brokers’ traditionally-demanding
standards of service. Rob Bailey, head of LVM explained that
earlier in the year the company re-launched its broker activities
as “Partner Programmes” which fully integrated brokers into the
company’s service and support model. Brokers are now segmented into
three categories, branded as Partnership for the top 20, Select for
the majority and Approved for new and smaller brokers.
He says: “Brokers survive by doing deals and it is our aim to
assist them in achieving that. We take a partnership approach to
brokers and currently write more new business through them than any
other individual channel. This is reflected nationally where
Finance
& Leasing Association statistics reveal that
broker-introduced business is increasing rapidly.”
Clinching new deals
The award follows a series of new deals won by LVM successfully
differentiating itself in the highly-competitive leasing sector.
The company started in 1977 when Austin Rover Finance was formed as
a joint venture between Lombard North Central (LNC) and Rover
Group. Its leasing roots, however, belong in British Car Contracts
which LNC formed in 1983 to offer specialist contract hire
facilities for business users.
Bailey joined LVM in 2006 with a background in banking – initially
with NatWest and later, after its acquisition, with RBS. He admits
that the complexity of vehicle leasing was a radical challenge
compared to branch banking but one common thread running through
the bank is the aim of seeking long-term relationships with
customers. “You don’t get that,” he stresses, “by merely being a
transactional operator.”
Part of LVM’s differentiation lies in its diversity of businesses
in the RBS group, including online car retailer jamjar, automotive
insurers Direct
Line, Churchill
and Privilege well as Green
Flag for roadside assistance and Tracker, the vehicle
monitoring and recovery system. All are offered as modular add-on
options and premiums can be included in a vehicle’s monthly
rentals.
LVM also leases a significant number of light commercial vehicles
(LCV) and has a dedicated van sales unit. Earlier in 2007 the
company launched a range of ready-converted “turn-key” vans aimed
at the professional trades sector including electricians, gas
engineers, plumbers and refrigerated delivery services. Bailey
explains that the initiative helps tackle the problem of
sub-standard load safety measures by providing a benchmark standard
for even the smallest of fleet operators. “Each derivative is
delivered with specialist racking, lining and resin floor, steel
bulkhead and internal lighting, as well as dedicated livery.
Specific vehicle packages for different key professions provide
service of real value to a large number of businesses.
“The need increasingly to comply with duty-of-care legislation
makes the range even more valuable – by ensuring that the vehicle
is fit for purpose for safe operation,” he notes.
Beating the competition
Having such specialisms as part of its basic structure led LVM to
win a major deal with BSkyB to supply around 2,100 vans and cars on
a solus basis. It won the deal in the face of opposition from some
20 tendering competitors. Bailey confirms that, initially, the
company is delivering 1,700 vans over the next three years but the
van fleet is likely to increase in size alongside the growing BSkyB
business.
In September, LVM began delivering the first cars to BSkyB. These
included 140 Toyota
Prius and Honda Civic petrol-electric hybrids. The deal is the
second high-profile environmental fleet contract secured this year.
Earlier LVM switched existing customer IKEA from conventional
vehicles into an all-hybrid car fleet. “These deals,” Bailey says,
“underline our expertise in specialist areas such as environmental
solutions.”
“Organic growth has been our mantra for some time,” he adds.
“Although I do not rule out acquisitions I prefer to gain customers
on merit. We are seeking to develop our affinity partnerships with
large corporates and at the same time are developing new products
in a marketplace that has not seen much innovation for a long
time.”
LVM currently leases and asset manages around 115,000 vehicles and
is the fourth largest motor lessor in the UK. In a market where the
players are principally fighting for volume, and therefore are
price-focused, Bailey believes LVM can extract good value by a
consultative approach to new business. “Our business model is
different,” he says, “and is sustainable.”
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