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Vehicle lease contracts and warranties should be extended to align with new real-world fleet replacement cycles that have emerged following the Covid-19 pandemic, according to Fleetcheck.
The software firm said that cars across its user base were now generally being operated for close to five years, compared with three-to-four years previously, while vans have moved from around five-to-six to seven-to-eight.
Fleetcheck managing director Peter Golding said: "Post-Covid shortages have meant most fleets have been forced to operate vehicles for much longer than originally planned and, in the process, have learnt that they can be safely and economically be operated on longer cycles.
'If you add to this the higher initial prices and uncertain residual values of electric vehicles pushing up costs, then there is considerable overall impetus to lengthen replacement cycles permanently, and this is something that we are starting to see happen on a formal basis with many companies now leasing for longer periods as a matter of course."
Golding said the main issue around lengthening contracts was SMR, and that there was a strong argument for longer manufacturer warranties to accommodate this.
He said: "While modern cars and vans tolerate age and mileage much, much better than in the past, they do inevitably need higher levels of maintenance over time, especially when it comes to the kind of unexpected breakdowns that cause the most disruption.
"What we feel really needs to happen now is for manufacturer warranties to align to these new cycles. Obviously, some do offer warranties ranging from five to seven years but there are several major fleet car and van makers who only provide three and, to our mind, this is inadequate for modern fleets and the lengths of time for which they now operate vehicles.
"Of course, extended warranties mean manufacturers are likely to keep SMR within franchise dealer networks for longer, so this is something that potentially makes sense for all."
Golding added that while there were human resources considerations around longer replacement cycles, in Fleetcheck's experience driver objections were limited.
He said: "To some extent, this is sector-dependent but in many industries, most car drivers are accepting five-year replacement cycles.
"Modern vehicles don't just last for longer mechanically and electrically, but they are also better cosmetically over time. Employees are content to keep a car for longer if it stays looking good."
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