LEASING: Buy-out and recession reshapes top 25 leasing firms chart
17 March 2009
The economic downturn well and truly hit the leasing industry in 2008 with companies having to consolidate and declare residual value write-downs, although there was one notable exception, writes Tom Webster
Lex once more sits alone, clear at the top of the tree as the biggest leasing company in the industry.
But not for much longer. By the end of this month, Lex managing director Jon Walden will have officially left his position, and Lloyds TSB Autolease boss Nigel Stead will take on his role, combining it with his existing job as the process of merging both the biggest and third biggest leasing companies begins.
So this time next year, expect to see a very different landscape at the top of the table. Rather than two big leasing firms backed by two giants of UK banking in HBOS (Lex) and Lloyds (Autolease) competing with each other, there will be just the one massive company at the summit following the acquisition of HBOS by Lloyds.
David Oldfield, boss of Lloyds Banking Group Asset Finance division, of which Autolease is part, said: "We are already planning how to bring the Lex and Autolease businesses together to create a strong and innovative market leader offering the highest levels of service, buying power and industry expertise."
As no further statements have been issued on the companies' futures, it can only be guessed what this will do to their current fleet sizes. Neither Lex nor Lloyds increased their fleet in the past 12 months. In fact, Lloyds reduced its by more than 3000 to 129,791.
With a straight combination of the two fleets, a giant company with 403,294 vehicles will be the result. It's likely there'll be some streamlining in the process, especially in the current climate of businesses cutting back on cars or extending contracts, and with talk of major leasing firms becoming increasingly reluctant to take the risk on new business. Autolease's residual value write-down (see page 4) is also expected to be the first rather than last of its kind.
Even after any stock trimming, the next largest company will still be a long way back in terms of volume. However, that next firm in line is already showing signs that it has no intention to be left behind.
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