Fleet Manager Solutions in Latam’s New Normal
Several challenges have hit the automobile fleet and mobility market in 2020 but as the New Normal takes shape, New Solutions are emerging, and this certainly goes without saying in Latin America.
Besides lower sales performance which has pushed many companies to seek innovative ideas aimed at cutting cost and increase efficiencies, there are several more industry specific challenges, according to local fleet management experts Felipe Marinheiro and Diego Appolari.
“Automakers halted production earlier this year, resulting in delays in the delivery of vehicles as well as auto parts and other supply constraints,” says Mr. Marinheiro who is a Fleet Specialist for Servier Pharmaceuticals in Latin America.
Felipe Marinheiro (source: Servier)
“2020 Automobile production (depending on the manufacturer) could fall by as much as 28% year-over-year,” he said during his presentation at Fleet LatAm Conference 2020, adding that the corporate leasing market has seen the opposite impact as it could increase by some 1.4% on average this year.
Fleet and Logistics Manager for Heineken in Brazil, Diego Appolari, also spoke at the international online event, adding that the food & beverage company does face some challenges from time to time such as satisfying change management and engagement needs as well as dealing with internal budget competition and finding the right supplier partners.
For Heineken, finding the right solution calls for implementing the best evolutionary processes. This includes using technology to implement cost reduction measures, fleet connectivity to improve fuel management performance, and telematics to improve driver behaviour and thus reduce traffic tickets and their respective fines.
Road safety management is a big part of the game, but it really comes down to people development. “We strongly believe that making a human connection is the basis for everything we do,” Mr. Appolari said during his presentation.
Diego Appolari (source: Heineken)
After implementing telematics and data management features to its fleet, Heineken was able to increase fuel efficiency by 9%, reduce traffic tickets and fines by 67%, improve driver speed-control scores by 26%, and increase 2.5-year ROI by 28%, year-over-year.
For Mr. Marinheiro, flexibility and resource optimization has a lot to do with finding the right solutions. Besides seeking more flexible payment terms and extending leasing contracts with your vehicle suppliers, fleet managers could consider new mobility solutions such as electric bikes and the flexible option of mobility cards.
In the ever-changing times, we can see that companies are facing more remote working, having more awareness on the environment, and dealing with urbanization changes. With that said, below are three of the main focuses to pay attention to amid the New Normal.
- Shared Mobility: Keep an eye on MaaS (mobility as a service). While the previously expected boom in the corporate car sharing market will likely remain stable or even decline, bike sharing should grow more than expected. Overall, MaaS growth is seen but at a slow pace, maybe 1% year-over-year.
- Electric Vehicles: EV production is likely to be unaffected and charging infrastructure projects will continue. Cutting costs will be sought after, meaning cheaper vehicles and possibly a reduction in the overall number of models.
- Leasing: Keep an eye on the move toward Subscription models, meaning short-term (one to twelve-month agreements). Moreover, leasing light commercial vehicles (LCV) to supply the increasing need for e-shopping coupled with contactless delivery services looks promising. Finally, used car leasing should also be attractive as residual values increase.
The Fleet LatAm Conference took place 29-30 September. Sponsored by Geotab, Element-Arval global partnership, Cepa Mobility Care and Trimble, the first day was wrapped around Safety in Fleet & Mobility and the second day addressed Opportunities in the New Normal.