Spring/Summer 2022
The bi-annual newsletter of the British Vehicle Rental & Leasing Association
Vehicle supply woes continue With restrictions on vehicle supply expected throughout 2022, the BVRLA is urging Government to reflect these shortages in its policymaking. Automotive supply chain issues caused by the Covid pandemic and war in Ukraine are causing major headaches across the vehicle rental and leasing industry. The BVRLA continues to monitor the situation and share its analysis with Government departments to ensure that they take these supply issues into consideration with their policymaking. The association recently convinced the Office for Zero Emission Vehicles to maintain its extended delivery period of 12 months for vehicles eligible for the Plug-in Grant. This supply challenge has been reflected in the gap between vehicle order banks, which have been at record levels, and the numbers of new registrations being delivered. Lead times are extending, orders are being cancelled at short notice, and customers are being encouraged to accept alternative vehicles. Widespread disruption has caused vehicle manufacturers to prioritise certain models over others. More importantly, they have chosen to prioritise the retail channel over fleet. This has meant fewer vehicles coming into the channel and cases of existing orders or agreements being ripped up.
Spotlight on Supply More than 300 members took part in a recent vehicle supply-focussed Industry Outlook webinar hosted by the BVRLA, which included Dylan Setterfield, Head of Forecast Strategy at cap hpi, assessing the impact of supply shortages on registrations. Dylan shared: “There has been a significant distortion in the new car market in recent months. Manufacturers have clearly been prioritising retail over all forms of fleet, and if you look at Q4 last year, retail was only down 1.3%, but over the same period fleet registrations were down 41.3%.” This point is supported in the BVRLA’s latest data, where members reported that lead times of up to a year were now the norm for all vehicle types. The knock-on impacts of extended lead times include vehicles being held on fleet longer, pushing up maintenance costs, as well as customers having to find compromises to keep mobile. Commenting on the current supply challenges, BVRLA Chief Executive, Gerry Keaney, said: “The supply chain challenges that beset our industry are having their negative impact on the fleet sector amplified by manufacturers prioritising other channels. This short-sighted approach will cause broader issues across the industry. A healthy fleet sector brings stability through long-term contracts, while bringing cleaner vehicles to the UK’s roads. “As a result of restricting vehicle supply to the fleet sector, the inevitable consequences are going to be increased costs to businesses, reduced choice for drivers, and higher emission levels.” u
YOUR ASSOCIATION The BVRLA in numbers BVRLA announces new Chair Green Shoots Growing the BVRLA family Strength in numbers Dates for your diary
4 5 6 12 13 16
LEARNING & DEVELOPMENT Learning & development
2
GOVERNANCE & COMPLIANCE How to keep compliant Keeping customers happy
7 7
REPUTATION Preparing for a long, busy summer 8 In roads made by RTO working group 9 EV INFRASTRUCTURE Getting to the point ZEV mandate maps UK’s road to zero
10 11
MOTOR FINANCE A new Consumer Duty regime Consumer Duty, what you need to DO
14 15