I first started working in the fleet market in 1985 with what was then Hertz Fleetlease – later Fleetlease and now Custom Fleet, initially in sales and then later as Operations manager running the fleet. 25 years ago in 1993 I started publishing Company Vehicle magazine.
Over that time some aspects of the car market and fleets have changed almost beyond imagination whilst others have changed only minimally.
When I started we still had a fully protected and inefficient local vehicle assembly sector; all cars had large tariffs and sales duties and in addition there was a luxury car tax. This meant after a three year lease a low km car fetched close to the actual purchase price as a residual around 70 percent of original retail before the fleet got a 10-15 percent discount and even higher mileage cars got around 60 percent of retail. Some smart government departments figured out that with the large government fleet discount they could keep a car 12-18 month and sell it for what they paid if not a bit more – great fleet economics although not so pleasing for the car companies! There was no FBT and no GST – life was simple. But the cars were billy basic – A Ford Fairmont which was second from top of the range had a bench seat, column auto and even the stereo and air conditioning were optional extras! Lower spec models had manual gearboxes, rubber floor mats and manual windows – not to mention no power steering. It took the advent of Japanese used imports to drag the manufacturers kicking and screaming to well specified cars, no doubt aided by company managers whose wife’s used import had all the fruit in terms of power windows and steering, aircon, etc, while his new company car had none!
Big Aussie cars ruled the sales charts – large cars were the undisputed market leaders in the same way medium SUVs are now, with Commodore and Falcon fighting for the market title each year. Pre FBT fleets were large with almost all managers and sales people getting a company car (I had one in a mid management job two years out of university). Utes were simple work vehicles with a few 2WD Commodores and Falcons getting semi recreational use and 4WD utes were the preserve of councils, farmers and forestry companies. Most SUVs were fairly agricultural with the exception of Range Rovers and a few luxury models. Leasing was a very new industry with little local understanding and limited options and the fleet management industry didn’t exist.
Major changes followed the ending of local assembly and introduction of FBT, depreciation became a real and major cost and fleets slimmed down as many perk vehicles were replaced by vehicle allowances or quietly retired from the pay strategy. Specification levels increased as did standard safety equipment (Which was pretty much limited to seat belts – in the front!) Now all cars have a suite of airbags, ABS and ESC, even some fairly low-level cars now have autonomous emergency braking and every car has a basic level of extras including power windows, mirrors, steering, good audio and air-conditioning. Sustainability, CO2 emissions and electric drive are now all serious considerations for fleet managers whilst leasing is mainstream as are external fleet managers.
So lots of changes but still a lot of the same issues which often involve people – who gets what car – can I have a towbar with it or lets fill up the boat as well as the car (electric cars will stop that one I guess!).
Happy motoring,
Cathy
