FLEETDRIVE
If the landscape is changing, should the solution?
Legacy manufacturers are still mostly offering three-year warranties. Finance was matched to that, and 3-year leases became the norm. After all, there is far less risk involved in leasing out a vehicle that is still covered by its original manufacturer warranty.
However, battery electric vehicles( BEVs) don’ t need to be tied to the same restrictive warranty period. In fact; the most important and expensive part of any BEV is the battery itself. Mileage has far less impact on that. As a minimum you can expect an 8-year warranty on a BEV battery.
Will we see a change to how total cost of ownership is viewed? and if so, how leasing is subsequently offered?
Is the software your suppliers rely upon ready to help you overcome the challenges in your market right now; also helping future proof you against incoming inevitable challenges? The increasing number of new models and variants of EVs and other alternative power source vehicles arriving rapidly from China which are already causing mayhem in markets like Germany which is Europe’ s largest overall car market. Chinese EVs and PHEVs are depreciating more quickly than the general market. Some of the reasons include perceived issues with ongoing support in the form of dealer networks and parts sourcing. Added to fast obsolescence as new models become better suited to European driving styles;
( See BYD Atto 3 as the perfect example).
Quicker depreciation leads to uncertainty for lease cos, fleet buyers and individual customers. Monthly payments rise; leasing companies are often left with larger than anticipated losses, and drivers face negative equity and larger than hoped for balloon payments.
Who is going to be more comfortable bearing the brunt of that residual value uncertainty?
The driver, the leasing company, the fleet management company?
If Australia is set to follow the EV resale pattern of Europe, with the negative effect looming over those novated lease drivers as they near completion of their leases, what is going to be the outcome? Mass contract extensions as those drivers try to defer losses against balloon payments? Are your leasing company providers set up to advise and administer those contract revisions? Can their systems cope? Will we see a move away from novated lease to operating lease? Again, does your leasing company have the systems to handle this change in market demand?
These are not challenges the fleet markets in Australia and New Zealand can’ t overcome.
Bynx is already supporting businesses through these challenges.
There are difficult choices and undoubtedly tricky challenges to overcome. If we know one thing about the fleet sector, it is resilient and can overcome challenges when businesses are on the same page and work collaboratively.
It’ s going to be important to choose suppliers that are best placed to help businesses across Australasia through the challenges that lie ahead. Both New Zealand and Australia are closer to China than anywhere in the EU. More models will arrive faster, so it is important to know how best to adapt.
Bynx is already providing this support through lease cos and fleet management cos in ANZ and other parts of the world. Already working in marketplaces that have the same specific yet different challenges as those faced in Australia and New Zealand
As fleet operators, it is going to be important that the leasing and fleet management companies you rely on have the right software to support you.
To see how Bynx helps navigate uncertain waters Arrange your demo today.