Under the Microscope: We talk to Duncan Chumley, MD at Free2 Move Lease
21 September 2017
Author: Debbie Wood
The PSA Group's merging of its Peugeot and Citroen contract hire businesses, and the creation of a new
brand, Free2Move Lease, paves the way for new products aimed at mobility. Debbie Wood reports.
Over the past few years, the leasing industry has seen its fair share of acquisitions and mergers. But few have made more sense than when PSA Group announced it would be combining its two leasing divisions, Peugeot Contract Hire and Citroen Contract Motoring, under the new entity Free2Move Lease.
The merging of these two companies and the forming of an all-new brand was more than just an administrative efficiency and cost-saving exercise. It was an essential part of PSA's move towards offering greater mobility in the future.
"The key aspect was to introduce a new brand to the group," says Duncan Chumley, managing director at Free2Move. "We had loads of different divisions that were all about producing mobility solutions for our customers, and we wanted to create one brand that was Duncan Chumley away from our car manufacturing and the brands, so it becomes our fourth brand within PSA."
Different transport solutions
Mobility is the buzzword for Chumley and his team and the larger aim is to have a mobility solution for every customer, wherever they are in the world and regardless of whether they want to buy a car.
The firm has already set up a mobility solution in the US, and an electric carsharing scheme in Madrid and Paris. In London, there will be a smaller-scale version where a customer can use the mobile app to organise a range of mobility services, from booking a taxi with third parties all the way through to the firm's new DS Rent platform for longer-term rental services.
"At the moment, we're looking at a variety of platforms," Chumley tells BusinessCar. "DS Rent is one that is being trialled in France and we're reviewing whether we can bring it to the UK. It'll be a premium rental service with the aim of allowing more customers to experience the brand and the great new products that are on the way.
"We're also looking at everything from short-term to long-term rental and one thing we've found is that customers want more flexibility, because their business has also changed."
The needs of the customer are changing, and Chumley believes buying behaviours in the future may mean many fleet customers won't look to buy a car from the firm anymore, instead want a complete fleet carsharing and transport platform.
"Leasing isn't rocket science - you've got a residual value, you've got a discount and you've got a service you can deliver to the customer, and what is key is delivering that service."
For some companies, though, the traditional company car will still be an essential part of how they do business. Chumley sees data as an important tool for developing services to these customers.
Available from October is a new compliance product that will be offered in three grades, giving customers the chance to view and manage their vehicles more effectively; from a simple mileage data tool, to sending alerts about vehicles that need a service, all the way to a whole suite of fleet management solutions.
Aimed at smaller businesses that don't have a dedicated fleet manager, many PSA vehicles now fit a 'black box' as standard and will have the capabilities to send data to fleets depending on how much the company wants to manage.
"Some see data as an upgraded sat-nav, others see it as a driver training tool or a compliance aid. So it's trying to align those needs with the customers. We have to be careful that we don't overload people with data that doesn't mean much to them, and that's what we're trying to look at - how useful the data will be to the customer and how it will save them time and money," Chumley explains.
Growth and investment
Although a merger can often mean a downsize in staff, at Free2Move, it has resulted in a rise in numbers. There are now 54 people working in the team and investment has been made in the areas that will be key to future growth, like in connected services and the public sector. There's been growth in the sales team, and a residual-value management team and an SMR team have been set up. Chumley now also has a team of consultants specifically looking into mobility solutions in larger companies.
"Although there are economies to bringing the previous leasing companies together, it's actually been more of an investment piece, as we've brought in a number of new services that we've never had before," he says.
One of the changes was to move the customer service team to Coventry to join the rest of the Free2Move team, and this has made a huge difference, according to Chumley.
"Our main drive and purpose is always to deliver a better service to our customers. Previously there was no communication throughout the journey of the lease, and we want to change that and ensure we continue to talk to our customers," he says.
"Leasing isn't rocket science - you've got a residual value, you've got a discount and you've got a service you can deliver to the customer, and what is key is delivering that service. Behind every company, even the large corporates, are buyers that are consumers and everyone has an expectation on the service they should receive. We don't always get it right, but we need to try and learn, and continue to deliver a good service to our customers."
No longer limited
Following the merger, Free2Move now has 64,000 vehicles in its fleet. Around 40% are vans and 100% of the stock is risk fleet. Chumley actually expects fleet volume to decrease over the next few years as the business model adapts; however, growth will be expected once PSA's recent move to a multimake offering gains traction.
The decision to offer leasing solutions for multiple brands, not just Peugeot and Citroen, was an easy one for Chumley. The aim is to deliver 1,000 non-PSA brand vehicles in the first year and then grow this to around 10% of the total fleet over the next three to four years.
By late 2017, Chumley and his team hope to have arrangements in place with all the major manufacturers in the UK, and a new quotation tool is set to be launched at the beginning of 2018.
"At the moment, our quotation tool offers the simple version but we've just taken on a new IT manager to evaluate all the systems in the marketplace, so we can upgrade our current system with the aim of having that launched in Q1 next year," he says.
It's an exciting and challenging time in fleet, and the next few years will bring waves of change as new technology, legislation and data come to the forefront.
For Chumley, staying ahead of the curve is essential and flexibility will be more important than ever. "It's going to be interesting to see just how the market does change. We may see people move away from the traditional company car as mobility becomes more important. We're trying to introduce a number of solutions so we can be tailor-made for the customer, not just in the UK, but also across Europe and maybe other countries in the future," Chumley says.
"Whatever we do, we need to be delivering for our customers and, more importantly, looking at what they are asking us to do. It's a very competitive market and quite easy to move from one leasing company to another, so we need to ensure that we are delivering what the customer needs."