18 mar 21

Fleet LatAm Business Networking Group, preparing LCV strategies

Fleet LatAm, the Latin America arm of Global Fleet, discussed the topic of light commercial vehicle (LCV) strategies during its latest Business Networking Group (BNG) meeting on Tuesday (16 March).

Discussing issues such as products available and the tax benefits fleet managers can take advantage of, the countries most talked about this time around were Mexico and Chile.

For Mexico, Element Fleet Management Sales VP Jorge Alvarez (pictured left above) highlighted some of the challenges and opportunities in the country in wake of COVID-19.

In terms of challenges, secondary LCV market values may fluctuate over the next 1-2 years followed by fleet resizing and structural changes in large enterprises, the executive said.

“Vehicle registration constraints are slowing down LCV renewal plans, thus forcing fleet operators to opt for older vehicles to keep things up and running,” said Mr. Alvarez, explaining that inventory constraints are resulting in reduced LCV offers.

Regarding opportunities, among the areas seeing growth are digital platforms for last-mile distribution, the electric vehicle (EV) commercial offer, tailor-made servicing solutions, and the implementation of telematics.

The latter is being used to monitor fleets, maximizing driver safety and vehicle theft as well as operational efficiency (increasing sales, customizing routes, maximizing fuel efficiency, etc.), he noted.

From 2011-2020, LCV sales in Mexico increased 3.5% annually on average. Moreover, e-commerce - which certainly impacts the use of these vehicles - jumped 81% year-over-year in 2020.

Down south in Chile, local vehicle leasing company Salfarent CEO Franco Capurro Reposi (pictured right above) highlighted the LCV tax benefits offered by the Chilean tax system. While trucks and vans are considered tax deductible expenses for companies, other types of vehicles benefit much less, fiscally speaking, he said.

“Another trend in Chile is the use of diesel vehicles as this fuel is about 30% cheaper in the country,” said Mr. Reposi. On Monday (15 March), gasoline averaged US$1.18 in the country while diesel was priced at US$0.81.

Some of the most popular LCVs in the Andean country are the Hyundai Porter and Kia Frontier, both with approximately 1,700k cargo capacity. In 2021, new light vehicles sales in Chile are expected to increase by 37.7% to 356,500 units, said Reposi.

Hyundai Porter (source: Hyundai)

Also speaking at the BNG meeting were other fleet experts from Mexico, namely Norma Ortiz who is in charge of fleet management for Chemicals firm Bayer, Liliana Anaya (general manager) for local leasing association AMAVE, as well as Jaime Bringas (president) and Kevin Kibilds (vice president) of fleet managers association AMAFA.

Besides informing BNG members about the profile of the companies and associations they represent, they enlightened the participants on their upcoming objectives and missions over the months and years to come.

Moderating the session was Fleet LatAm Business Networking Group president Pascal Serres who was accompanied by editor-in-chief of Nexus Communication (publisher of Fleet LatAm) Steven Schoefs.

Those participating included fleet and procurement experts as well as suppliers from the region (Brazil, Mexico, Colombia, Argentina, Chile, Central America, among others). If you are interested in joining us in the next meeting, contact Pascal Serres: pserres@nexuscommunication.be  

Stay tune for Fleet LatAm’s upcoming events, being the Fleet LatAm “virtual” Conference 2021 VEx (virtual experience) "Driving Fleet Efficiencies and Cost Savings in Latin America " to take place on 22 April and the next Business Networking Group meeting to occur on 18 May. See you there!

Authored by: Daniel Bland