As we move closer to the end of 2022, there is still little relief from the global new vehicle shortage. After a drop in demand caused by the pandemic, vehicle orders have surged to unexpected heights, but a shortage of automotive semiconductors is hampering production.
While manufacturers of laptops, white goods, and other devices have also cut production because of semiconductor shortages, the repercussions in the automotive industry have been more severe.1 According to Auto Forecast Solutions, around 1.25 million vehicles have been culled from factory schedules worldwide since the beginning of 2022.2
In this article we examine the strategies Interleasing are seeing fleets adopt to keep mobile during this challenging time, and how utilising a FMO relationship can make all the difference.
The impact of shortages is being felt across all organisations
All sized fleets, across all industries, have had to diversify their vehicle acquisition and disposal strategies to keep their companies moving, with many leaning on their FMO to make this happen.
Working in partnership with your FMO is critical right now to maintain mobility. In addition to extending vehicle life, other strategies being pursued across fleet management include adding alternative vehicles to suites, and expanding the number of acquisition channels to include second-hand vehicles.
78% of Australian fleets are still impacted by the global new vehicle shortage.
72% of larger fleets are still waiting for significant books of new vehicle orders to arrive.
While recent AfMA research3 suggests these reactionary strategies will have impacts on operational efficiency and cost in the short to medium term, they’ve been able to ensure more fleets are kept at capacity and on the road.
Making the most of every opportunity
Tapping into and leveraging relationships, networks and the experience of an FMO can help you access new ways to keep your organisation mobile.
Adam Morrison, Chief Executive Officer, Asset Management Services, knows just how important our role as a FMO has been during this time. “We have been committed from the outset to sourcing the vehicles organisations need to stay mobile. In fact, it’s one of the service pillars we have always prided ourselves on. We have left no stone unturned to ensure we leverage our position, influence and connections in the market in order to see our clients’ mobility needs met.”
In our role as FMO we have been able to:
- Acquire vehicles through Just Honk Used Cars (part of the MMS Group, Interleasing’s parent company)
- Lean on the strength of our national dealer network and partnerships with auction houses
- Use our knowledge of end of lease returns across the MMS Group to provide schedules and predictability of leases across all key passenger and light commercial vehicle categories – over multiple short term lease periods
Do you need a FMO to go the extra mile for you?
Providing our clients with solutions to overcome outstanding new vehicle orders is what we are here to do at Interleasing. We work with fleet managers to optimise their mobility and identify new ways to overcome fleet supply risk. It’s just part of the partnership we offer our clients. Watch our client Hempel describe how Interleasing has assisted in overcoming their fleet difficulties.
For more about how we can help your fleet, get in touch today.
1. McKinsey, Semiconductor shortage: How the automotive industry can succeed, June 2022
2. Car Expert, Almost 100,000 vehicles a week being cut from global production, March 2022
3. AfMA / ACA Research, Australian Corporate Fleet Insights Report June 2022, Research Participant Summary Report, p.61
Other resources
How a FMO can help you meet your FY23 priorities
