As fleet managers said farewell to 2021 – and what has proved a challenging year for the automotive transport sector – how should they prepare for the year ahead?
The complexities of the global economic landscape and the ever-changing nature of business mobility means that fleet management strategies are having to continually evolve.
As we glance to the horizon, with the world of business looking to bounce back from the COVID-19 pandemic, we have outlined four key considerations that may help to shape your plans for future fleet success.
Flexibility key amid uncertainty and disruption
From supply chain issues and concerns over vehicle availability to economic volatility, digital disruption and the pandemic, it’s fair to say that uncertainty is the only certainty in the current fleet management environment. This is unlikely to change any time soon.
Strategic preparations should consequently build in an allowance for greater decision-making flexibility.
As governments commit to decarbonisation targets and new laws come into force, as new mobility models emerge and as new technology solutions come to market, fleets may be called upon to respond and adapt with agility.
Advances in electric vehicle technology are accelerating, while future generations of vehicles are set to become more attractive and affordable, meaning fleets should look to review their fuel strategies and vehicle choice lists with increasing regularity.
Allowing for budget flexibility and avoiding lengthy fleet contracts may prove beneficial for companies looking to retain a healthy cashflow during periods of economic uncertainty.
Furthermore, as delays in new vehicle lead times continue, and new working patterns take hold, some businesses and employees may be reluctant to commit to long-term lease contracts, making flexible mid-term lease and short-term hire contracts compelling options.
Every organisation will face differing needs and challenges as we enter the new year, but it is their flexibility that may ultimately hold the key to them securing operational resilience.
The rise and rise of mobility solutions
Corporate mobility will continue to grow and evolve as we collectively strive to make business travel more sustainable and costs-effective, while at the same time giving employees the choice and flexibility they increasingly demand.
We are just at the start of this journey, but we can expect mobility policies and the provision of tailored, flexible and smart mobility solutions – alongside the company car – to become more commonplace during 2022 and beyond. What’s more, these are set to be increasingly backed by digital solutions to help enable and optimise mobility decisions.
As the future unfolds, fleet businesses will have to increasingly embrace this new, emerging mobility ecosystem, devising mobility strategies, introducing mobility budgets and allowances and investing in systems and processes to improve vehicle utilisation to reduce costs and ensure positive environmental, social, and corporate governance.
The mobility market is changing and diversifying fast. Business should engage their fleet partners and start planning now.
Fleet electrification will continue to gather pace
Mirroring European Commission proposals, a recent COP26 declaration signalled a commitment by signatory governments worldwide to work “towards all sales of new cars and vans being zero emission by 2040 or earlier, or by no later than 2035 in leading markets”.
The race is on, but the signs are positive, and the direction of travel is clear.
According to data from 26 European markets, electric vehicles (EVs) and plug-in hybrids outsold their diesel counterparts for the first time ever in August 2021. Furthermore, the European Automobile Manufacturers’ Association (ACEA) has revealed that almost one in five vehicles sold in the European Union during the third quarter of the year (July-September) was an electric model..
With more models of EVs to choose from, vehicle manufacturers ramping up production, improving charging infrastructure (the EU Green Deal targets one million points across the bloc by 2025)and persuasive Total Cost of Ownership (TCO) savings to be realised, business fleets are helping lead the charge.
Indeed, the business case will become ever stronger as government regulations become tighter and the roll-out of Low Emission Zones (LEZs) continues.
As we look ahead, the realisation that EV adoption brings significant business, as well as environmental, benefits will serve to accelerate the electrification trend.
Safety standards take centre stage
Road safety may be a recurring theme for business fleets, but a range of factors are set to lead to risk management moving up corporate agendas in 2022.
According to UK road safety charity Brake, more than 1.35 million people still die on the world’s roads every year.
Across Europe, the number of road deaths may have fallen by 36 per cent between 2010 and 2020, but despite this progress, the reduction failed to meet the EU’s 50 per cent target for the decade.
The global commitment to road safety improvements, consequently, shows few signs of abating. The EU’s road safety strategy now aims to bring the death toll down to “close to zero” by 2050 and the European Parliament recently signed off a road safety report that made recommendations on how this might be achieved, including incentivising the purchase and use of safer, clean vehicles.
Vehicle safety features such as intelligent speed assistance and advanced emergency-braking system will have to be installed in all new vehicles sold in the EU from July 2022 and according to ETSC (European Transport Safety Council), by next year “the European Union will have, by far, the most stringent vehicle safety standards in the world”.
This drive to improve safety standards will continue to influence fleet operations, along with their risk management programmes.
Furthermore, new post-Covid employee mobility patterns, innovations in after-market safety technologies and the electric transition – which will see fleet drivers contending with new EV driving characteristics – will all play a role in shining the business spotlight back onto road risk management.