Element CEO Jay Forbes: Production delays impacting revenue growth potential
Element Fleet Management is expecting 4-5% revenue growth for 2021, but it would have been double that if automobile production was in line with demand, according to CEO Jay Forbes (pictured).
Production has been down owing to microchip shortages and this has resulted in vehicle deliveries taking 2-5 times longer in some cases, the executive said in a BNN Bloomberg interview.
The company exited 2021 with US$2.5bn-2.8bn in backlog orders, compared to the US$1bn expected under normal circumstances. This has resulted in US$45mn-55mn in highly profitable revenue which will be deferred and not lost, according to the executive.
Mr. Forbes sees an uptick in deliveries in 2022 as semiconductor chip access will improve as well as OEM production output. A full return to normal production and delivery times, however, is not expected until the first semester of 2023.
Boasting US$14.5bn in assets and over 1mn vehicles under management, Element Fleet Management has 5,500 clients across 700+ industries in Canada, US, Mexico, Australia, and New Zealand.
Photo: Element CEO Jay Forbes (source: BNN Bloomberg)