Fleet management in Europe

Relevance of fleet management

Today, the ability to manage and operate fleets of multi-brand vehicles is a highly profitable business which is gaining significant importance. Particularly when we think about two of the main trends which are most likely to substantially influence the future of the automotive industry: 

1. The trend towards sharing instead of owning and,  
2. The trend towards self-driving vehicles.

It comes as no surprise that more and more original equipment manufacturers (OEMs) are actively pursuing opportunities in the multi-brand fleet management market. Historically, the business was largely dominated by fleet management companies fully or partially owned by large banks. And today, several of the largest players still are. In recent years, however, several OEMs have (re-)entered the multi-brand fleet management market, or substantially expanded their operations.

Overview of study

In this study we will explain in greater depth:

• Why the strategic relevance of fleet management will continue to grow 
• What the key characteristics of the business model are
  
• What will be the future drivers of the corporate car market

Furthermore, the study names the key players in the industry, which main mergers and acquisitions activities have recently characterized consolidation in the industry, and what implications the main trends in the automotive industry with regard to the future of mobility will have for fleet management. Our study concludes with a summary of major strategic implications and respective fields of relevant actions required of the various players in the fleet management business.

Key findings

Overview of corporate car market and development

Fleet management in Europe is a multi-billion-euro industry based on a profitable business model and the increasing shift of new car sales towards the corporate channel. The top five players combined make up for more than 50 percent of the managed cars. Current key players are predominantly bank-backed coming from the roots of this asset-based business. Nevertheless, more and more OEMs are putting focus on this market as they see an increasing relevance for their core business in a world of changing mobility.

Increasing relevance of fleet management market

The relevance of this market will further increase in the future due to multiple influencing factors. The younger generation will buy fewer cars in the future. Firstly, the relevance of owning a car for social status is strongly declining (also blurring the importance of brand perception of cars).

Secondly, the increasing urbanization drastically reduces the attractiveness of owning a car, amongst other things, due to the high cost and hassle associated with finding a parking space alone. The increasing shift from ownership towards usage fueled by the increasing mobility offerings and business models especially in urban areas will further shift new car sales towards the corporate channel. Corporates will start to see their company fleets not only as a cost but also as a potential revenue model leveraging services such as corporate car sharing.