Error parsing XSLT file: \xslt\FacebookOpenGraph.xslt Rental companies turning down fleet business for retail, AFP warns
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Rental companies turning down fleet business for retail, AFP warns

Date: 16 May 2022   |   Author: Sean Keywood

Some daily rental companies are beginning to turn down fleet business in favour of higher-margin consumer bookings, according to the Association of Fleet Professionals (AFP).

The organisation's director James Pestell said that businesses were finding no vehicles were available using corporate rental online portals, but then discovering that if they visited a rental outlet in person, they could hire a vehicle at a retail rate using a credit card.

Pestell said: "We're not saying all rental companies have adopted this as a policy and we are not saying that, even within the same companies, it is happening uniformly across the country - but it does certainly seem to be happening, according to feedback from our members.

"To some extent, suppliers doing this is understandable. Most of them are operating reduced fleets in a time of high demand, so it makes commercial sense for them to be employing their assets in markets where bigger margins are available.

"On the other hand, fleets are regular and reliable customers for daily rental and often have longstanding relationships with their preferred rental suppliers. Their needs should arguably be given due consideration. 

"Certainly, we suspect that many of our members would rather be given the opportunity to have conversations about rates than simply be shown zero availability when there are vehicles available for rent."

Pestell said that rental shortages were currently a regular topic of discussion among AFP members, with widespread discussions about the difficulties that were being faced.

He added that the situation was showing few signs of improvement, and may even get worse before it gets better.

Pestell said: "Rental companies - like everyone else - simply can't access new vehicle supply in the quantities they need.

"However, it does create difficulties for fleet operators in all the usual instances when rental vehicles are needed - to cover vehicles that are off the road for repair, for new employees, for temporary contracts and more.

"Some fleets are keeping hold of vehicles that they would normally have defleeted to use as pool vehicles as an alternative but this is far from a perfect solution, with the vehicles often in the wrong locations for the current need."

The problems facing fleets in the rental market follow on from concerns about car manufacturers prioritising retail over fleet customers for new car sales, with the Society of Motor Manufacturers and Traders acknowledging that this was happening when it published its registration figures for the month of April.