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Carlos Montero's blog: 30 November - Annual LCV shortage as Christmas approaches

Date: 30 November 2015

It's the same every festive season; LCV demand rockets as businesses queue up to hire them, but this can put a huge strain on the number of vehicles available, says Carlos Montero
Carlos Montero is commercial director at FleetEurope

Longer nights and colder weather means only one thing - winter is definitely here. With it, we see annual events like Black Friday and Cyber Monday build up to the usual Christmas rush, but there is another side to these festive events.

The light commercial fleet market is a lucrative one, a cocktail of unique qualities and situations. It is full of versatile vehicles with endless customisation combinations. Light commercial vehicles can, quite literally, be made to measure but every single one is a business tool, a need (not nice) to have.

From October, we see the demand for these vehicles increase dramatically, which has implications for the market as a whole. Driving demand are delivery and logistics firms, who can swallow up large amounts of available stock to keep up with the additional deliveries over the festive period. It can, and has, left other businesses, particularly SMEs, short during a critical time.

For short term lease and rental providers, this can be a real issue. There is a fine balance to strike, ensuring all customers are serviced appropriately. It would be easy to rent all vehicles on a first come, first serve basis, but this will alienate those who rely and trust you with their all year round requirements.

Logistics and delivery companies are also susceptible, due to the nature of their high volume stop/start work, to accruing damage on their vehicles; for leasing and rental partners, this is a real problem. To earn their keep, rental vehicles need to be out on the road and not sat in yards, but if there is a significant amount of damage when returned, this can have financial implications for rental providers.

If vehicle is returned with damage, the repairs can force it to be removed from service to be brought back up to standard. Downtime for rental vehicles is a direct cost to a business and during a period of high demand, the cost quickly escalates. 

For local businesses looking to hire a van, they can often face a shortage in availability on the run up to Christmas with possibly higher rental charges. They also face using vehicles which are ill-suited and, in the worst case scenario, can be left without a vehicle to carry out their work.  

This is where fleet management providers are extremely valuable, having relationships with rental providers across the UK, often with set rate cards. When it comes to looking for a vehicle, these can do the leg work to source a vehicle or vehicles that are fit for purpose, available locally for a standard rate card. Not only does this save you time, it can also save you money.

Where vehicles are in short supply (or high demand), some companies can even arrange for vehicles to be moved or delivered in from further afield so you are not forced to take whatever is available. 

By using fleet management providers, you have a significantly better chance of getting a van, which meets your requirements during a time which sees peaks in demand and shortages in supply.

Carlos Montero is commercial director at FleetEurope