A GLASGOW-based car leasing firm has revealed plans to expand its workforce by around 50 per cent and take on additional space at Skypark as it eyes expansion – despite Brexit uncertainty bringing pressure to the wider market.
Fleet Alliance, which leases cars to private individuals and businesses, declared it will lift its headcount to 150 after seeing its combined fleet of managed vehicles rise to 37,000 – giving the fleet a combined value of £1 billion.
Managing director Martin Brown said the firm is on track to lift underlying profits to £2.5 million from £1.8m, with fee income from leases expected to come in at between £10m to £11m, up from £9m. The fee income rise reflects the increase in the value of vehicles managed, with the firm expecting to buy a further 8,000 vehicles for leasing this year.
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The growth has come as the firm has gradually diversified from supplying SMEs (small and medium-sized enterprises) to larger corporates in the 17 years of its existence, while also targeting individual motorists in the growing private leasing market. It also leases vans on a commercial basis.
Mr Brown said: “The £1 billion asset value is a significant step, I think, in terms of the credibility that it gives us in the market, to go and win larger corporate clients. That’s enormous for us.”
Mr Brown, who set up Fleet Alliance with fellow shareholders Allen and Marjory Flynn, concedes it is currently one of the biggest periods of change he has witnessed in his 23 years in the automotive sector. The challenges facing the market range from the transition from fossil fuel-powered to electric and hybrid cars, pressure from increased company car tax, technological disruption and the debate around emissions following the Volkswagen scandal, he said.
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Mr Brown also cited the impact on consumer confidence arising from Brexit uncertainty, with the Society of Motor Manufacturers and Traders (SMMT) warning this week that a no-deal Brexit would “trigger the most seismic shift in trading conditions ever experienced by automotive”.
While the latest figures from the SMMT show the number of new car registrations in May was down 4.6 per cent on the previous year, Mr Brown said he tends to look at the market “more positively”.
He added: “It’s a big market, and there is a lot to be going at. You could argue that some of the numbers over previous years would maybe be a bit over-heated. It is a very changing and heated market, but it always has been. There are ups and downs and cycles in any sector.”
Asked to sum up the mood of the company’s business customers, Mr Brown said sentiment has been “quite positive” this year.
He added: “Overall we feel it has been pretty steady. There has been no real issue, and that is borne out by our numbers. What I would say that it is a mixed message – there are businesses in our sector that are finding it tougher.
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“In a tough market, price is obviously a factor. We are competitive, but our technology is playing a big part in winning and retaining clients.”
Fleet Alliance has developed its own technology in house, which includes a cloud-based fleet management and reporting suite called e-Fleet. The e-Fleet Mobile app is used by drivers to take care of vehicle servicing needs, while the desktop version caters for the demands of the company’s corporate customers.
Mr Brown said the firm is in the process of negotiating a second office suite at Skypark, which will be used to house its growing team of tech and customer service staff. He expects to grow staff numbers to 150 over the next 18 months.
And he said the firm would consider making further acquisitions, following the 2017 deal which saw it buy a controlling stake in Neva Consultants, an Essex-based fleet management firm.
Mr Brown said: “We are very keen to grow the business and to add more scale. So if the right opportunity comes up, we would do that.”
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