Under the Microscope: We talk to Suzuki's fleet boss, Graeme Jenkins
11 April 2017
Author: Debbie Wood
Joining an established manufacturer and having a blank canvas to build its fleet department is an opportunity that rarely comes along these days. However, that's the task set for Suzuki's new fleet director, Graeme Jenkins, who joined the firm in January this year.
Suzuki would be the first to admit that it hasn't done enough in fleet over recent years, with its efforts focused mainly in retail. On the back of the firm's best-ever sales performance in 2016, bosses now believe the time is ripe for Suzuki to turn its attention back to fleet.
Kick starting fleet
Alongside Jenkins, the Suzuki fleet team consists of a cost of an ownership manager, a marketing specialist, two fleet coordinators and two fleet administrators.
Jenkins is also recruiting for a contract hire and leasing manager to develop relationships with leasing companies, an area that will be key to the firm's growth plans.
"In our first year proactively going to the fleet market, one of the key challenges is going to be to make the market aware of our brand," Jenkins tells BusinessCar. "We've got a very strong retail performance but what we now need to do is transfer that into the core fleet market."
According to Jenkins, having the right foundations in place will enable Suzuki to build long-term sustainable growth and the team will not actively seek business until they have the structure and plans in place to do so.
"If you're building a fleet department into a manufacturer that has historically not got into fleet in any big way, then the first thing you need to do is build very strong foundations," he says.
One of the reasons Suzuki is investing in a national contract hire and leasing manager is to help build relationships within the industry, something that Jenkins believes is vital to winning business in fleet and, if the firm wants to achieve growth, Suzuki needs to get closer to the leasing companies.
"The smart way is to be working hand -in-hand with leasing companies who are funding the fleets these days. They, of course, have a major influence over procurement," he explains.
"While the fleet manager still exists and provides a very important role, we see it changing quite a bit, especially funding methods. We have to recognise that and work with leasing companies to maximise our opportunities."
Being transparent with residual value guides like Glass's and CAP is also important for Suzuki and an area, again, where communication will be key for Jenkins and the team.
"Suzuki has provided me with the resources to go to market in the right way and develop the relationships and, as we all know, the fleet market is all about relationships," Jenkins explains.
No longer a one-car brand
Revealed at this month's Geneva motor show was the new Swift, a car that has been key for Suzuki historically in fleet.
The new model goes on sale in June this year and is the third car to come from the firm's lightweight car platform. It's 125kg lighter than its predecessor and showcases Suzuki's new BoosterJet petrol engines alongside the firm's mild hybrid system, both of which are key for keeping running costs and emissions low for fleets.
"If you look at the Swift and the market trends, which are moving towards petrol and small five-door cars, then the Swift is a car that ticks all the right boxes, especially with the new petrol engines which will be arriving in that car," Jenkins says.
Although the new car will help bolster sales, Jenkins is keen to point out that Suzuki has a wide range of cars, like the Baleno and new Ignis, that are now suitable for fleets.
"For the first time Suzuki has four or five models that are all fit for fleet in various segments. There is not one car that should dominate - we should have a nice spread of our portfolio across the sales," he explains. "We don't need to rely on one product, which perhaps historically we didn't have the benefit of before."
There are no current plans to introduce a plug-in hybrid or electric vehicle. Petrol will be the focus for the short term - however, Suzuki has been testing Swifts with range extenders (a 666cc petrol engine alongside a large electric motor) in Japan for the past two years and is exploring the possibility of launching electric powertrains in the future.
"Longer term we are looking at full hybrid and EVs but it's way off. For the moment we are concentrating on petrol engines and mild hybrid applications," Jenkins says.
"We've gone for the mild hybrid application because it gets our cars in front of people at a lower price point. You can get the car on someone's radar at a much lower price while offering very good fuel consumption and low emissions."
Big growth plans
In 2016 Suzuki sold just over 5,000 cars in fleet, 40% of which came from Motability, an area that has proved an important channel for cars like the Vitara and Ignis.
Jenkins aims to grow Motability to around 3,000 cars this year and total fleet sales up to 7,500. A key area of growth will be the SME market and Jenkins will be focusing on core fleet business rather than rental and short cycle.
"The cars that we manufacture are built for the SME market, so while we are growing relationships with the contract hire and leasing industry, naturally that will go into areas like SME and mid-sized corporates," Jenkins says.
"We've got no plans to go into short-cycle business - with the products we have there's no need to. We have no plans to do any major rental business either. If we do it'll be very much on a regional basis and in very small numbers. "
Another big challenge for Jenkins and his team in 2017 is how Suzuki moves the network forwards. Currently, there are 156 dealers and Jenkins is already meeting with key stakeholders within the dealer groups to look at how fleet businesses can grow. A fleet programme is under development, alongside an aftersales programme specifically tailored for businesses.
"Building a fleet programme within a dealer network has to be on an inclusive basis, something that everyone can contribute to so that all the dealers can benefit from the growth that we achieve," says Jenkins. "It's very important that we grow incremental business as well as having profitability attached. It's early days at the moment - Rome wasn't built in a day and there's a lot to do here."
In 2017, a gradual increase in market share is what Suzuki is looking to achieve alongside the headline 7,500 growth figure. And things are looking good so far: January was the firm's best-ever performance in fleet and so far quarter one is shaping up to follow the same trend.
"What one needs to do is look at where Suzuki has been in terms of its performance in the fleet market, which has been very limited, and look at the business model on where we need to go and what we need to do - what parts of the fleet market we are going to attack and to chose the battles that we can win," Jenkins concludes.
"It's all about getting Suzuki on the map and raising awareness in the fleet industry, and the opportunity here is most certainly the most exciting one to date for me."