The BusinessCar Interview: James Douglas, Audi
09 June 2015
The German car maker's fleet boss James Douglas is enjoying being fleet's biggest-selling premium brand, but tells Paul Barker happy customers are more important than numbers
According to the figures from the Society of Motor Manufacturers and Traders, Audi re-took the premium brand top spot in terms of fleet registrations from BMW in 2014. However, delve deeper into the stats and, according to Audi fleet sales director James Douglas, being number one is nothing new when it comes to 'true fleet', or registrations to genuine end-user customers.
"We're number one in true fleet. I inherited that and we've had that
position for a long time," Douglas tells BusinessCar, but he adds: "I'm more interested in building something we can be proud of and that supports customers and drivers; something they feel is sustainable and meets their needs and requirements. If we do that, the baseline of success takes care of itself."
Douglas joined Audi in 2012 after more than a decade with Nissan, and claims a comfortable lead in terms of true fleet, while being behind his main prestige rivals BMW and Mercedes-Benz in rental market share. According to him, Audi recorded a true fleet and Motability increase of 17% last year, with BMW and Mercedes recorded 10% and 11% respectively.
He says he's "very aware" that Mercedes, in particular, is making aggressive inroads into the fleet market.
"If they overtake us, they overtake us. I own a target that says we want to deliver this number of cars, and being number one has no commercial value," he declares. "Being the best has value to it. I will happily pin my colours to that - having the best customer service and the best dealer network."
Douglas says Audi's dealer network is integral to the fleet growth, and is set up in a way so that dealers want and need to take an interest in the sector.
"I'm fortunate that we don't have an agency model, where it's done from the leasing company and the dealer gets a handling fee. We keep fleet and retail aligned so the dealer has one contract for all cars," he explains. "That encourages them to engage in all areas of the marketplace - one invested dealer network with the motivation to engage with fleet and lease."
However, getting dealers to engage with fleet drivers has been a perennial problem for manufacturers.
"When we as an industry talk about the future, you have to find a way to make sure the business treats corporate drivers like walk-in customers, and that's not always easy," says Douglas. "I'm confident that my network delivers that today, and that's in no small part because the fleet and retail business is all in one, all the network's responsibility.
"I see a network that genuinely cares about customer service," he continues. "I don't mean to sound surprised - it's very pleasing to be able to say that and put my name to it."
As well as dealer-based business, Audi has also been growing the number of sole-supply contracts it operates.
"The number has increased rapidly over the last year, and it increased rapidly because we set our stall out for it, and the depth and breadth of our brand lends itself to these contracts," says Douglas, who adds he'd love to see a baby 'Q' crossover model, although Audi's extensive range coverage has led it to win some "significant deals".
The firm is also about to trial a "centralised fleet manager" service, enabling customers wanting a more hands-off approach to be managed centrally if that's their preference, rather than by an area fleet manager.
"With the rise of technology we can have a structured relationship with customers; why shouldn't we have a video conference, although we can only do that if it's what the customer wants," he says. Otherwise, they remain under the jurisdiction of their area fleet manager.
"We want to grow, but in a sustainable way - you've got to be careful in fleet to understand what it is you want to achieve," concludes Douglas. "To sell more cars can be done, especially in a premium brand, but building a sustainable brand for you and a dealer network that customers can rely on is very difficult. Fleet growth is easy, sustainable and profitable fleet growth is a long-term thing."
It will be a busy couple of years for James Douglas and his Audi fleet team, especially with the overdue arrival of the new Audi A4, which we'll see pictures of in the summer before it goes on sale late this year.
"Over the next couple of years we have some quite significant product launches that will be exciting to be involved with," he says.
The all-new Q7 is launching in late summer, while the brand has also just revealed a fourth low-emission model under its Ultra branding. Joining the A4 and A5 from 109g/km, and the A6 from 119g/km, the A3 Ultra emits just 89g/km.
"Ultra has been huge," said Douglas. "When I took over fleet two years ago we couldn't point to CO2 as a strong area, but it feels like we're in the race now," he says. "This year, we'll have more engines with better CO2, and the next year again. It didn't stop us selling cars, but our product range has got more appealing."
Audi is also moving into electric technology, although the A3 E-tron model, its first plug-in, is suffering from significant delivery lead times as demand outstrips supply. Douglas says he doesn't see Audi becoming synonymous with EVs: "It's an enhancement, the E-tron is a halo product for the A3 as a range-topper. It's top of the range with additional spec and benefits, and costs very little to run as a company car. I just wish we could get hold of more of them. We've got two customers that want considerable volume."