Localised franchise dealer networks are “likely to remain important to fleets” says fleet software specialist FleetCheck following news that more are to close.
Peter Golding, managing director at FleetCheck, said that a long-term situation was being created where many businesses were having to travel further for routine servicing, maintenance and repair.
“We’re not picking out any particular manufacturer here because it is effecting a number but this is something that appears to be happening without much discussion about how it will change provision of SMR for fleets.
“The business argument for rationalising networks is easy to understand – franchise dealers often operate on very low-profit margins and these are only going to come under further pressure as cars and vans visit workshops less, especially with the expected rapid uptake of EVs and more dependence on vehicles that can diagnose their own faults.
“However, the fact remains that utilisation is a fundamental element of fleet management and having a vehicle off the road costs businesses money. The further away the franchise repair centre is, it is likely that it will take longer for servicing or repair to happen.
“This is especially important for van fleets. To an extent, car fleet breakdowns can be managed because their use is typically more sporadic – but vans are often used all day, every day and getting them back on the road is important.”
Peter said that there was a definite possibility that the ongoing loss of franchise dealers was already driving more fleets towards independent garages.
“We have no industry-wide data on this but we are certainly aware of several fleets where this is happening. If the franchise dealer network effectively vacates an area, then it opens the door for high-quality independents to take over the business.
“This is, again, much more likely to happen with van fleets than cars but it is certainly the case that for many mainstream cars, having an independent service history rather than franchise is much less of an issue than it once was.
“Additionally, there is a general perception among many of our customers that it is already difficult to book into some franchise dealers. Independents are often simply easier to deal with in that respect, as well as being typically cheaper.”
A further point in the wider discussion, he added, was that several new manufacturers were entering the UK market without conventional franchise dealer networks.
“This is happening especially with EV manufacturers, who either have very small networks or effectively none at all, working with independent partners. It will be really interesting to see whether fleets find this satisfactory over time.
“The counterargument here is that fleet satisfaction with many franchise dealers is not that high to begin with, so new methods of provision are likely to be better. However, it is difficult to argue with the advantages of geography. Our view is that local provision is likely to remain important to fleets, at least for the foreseeable future.”