Mauricio Medina, AMAVe: “Enlightening companies to the financial benefits of leasing”

In tough times, one of the keys to optimizing fleet management is to consider vehicle leasing in your operations, according to Mauricio Medina who is the new president of Mexico vehicle leasing association AMAVe.

In my one-on-one with Mr. Medina, who is also the CEO of local transportation equipment leasing and fleet management company TIP Mexico, the executive sheds light on some of the market challenges in the country and ways to overcome them.

Holding the position of AMAVe president since March 2020, he has been working in the financial industry for more than two decades.

Could you tell us about your experience in the mobility and fleet management industry, and also give us an idea of the objectives the Association has for this year.

Medina: With pleasure, I have 22 years of experience in the financial sector, of which 16 were mainly related to vehicle leasing and trailer fleet management.

Of this, seven are associated with the leasing and management of all vehicle fleet types. Following the launch of TIP Auto in 2013, the company was quickly positioned as one of the main players in the leasing and fleet management sector in Mexico.

As for AMAVe objectives, our priority is to promote legislative reforms and to continue pushing for a leasing culture that supports the growth of the industry in Mexico.

What kinds of legislative reforms are you talking about?

Medina: I'm talking about a reform to the Commercial Code which, in case of non-payment of rent, would allow for the recover of movable property which has been granted in a pure lease. Moreover, it is vitally important that we establish effective ways to ensure that the fulfillment of contracts occures expeditiously.

These are some of the modifications that will help improve market conditions and boost activity in the industry. 

What is the benefit of vehicle leasing in Mexico and why are there still companies and people who do not adopt this option?

Medina: Leasing is an industry which capitalizes on opportunities. It is an efficient tool for cost savings and the freeing up of resources for private companies as well as governments. Mainly, it is focused on reducing operating costs, renewing vehicle fleets and deducting taxes.

The main challenge for us is that some people look for a sense of belonging and they end up not leasing as they recognize that the car is not their property. However, it is this thinking that hinders their chance to expand their horizons and actually learn all the benefits they can get from leasing.

For AMAVe, one of our main objectives is to enlighten companies of all the financial benefits they can get from this fleet management option.

Top 10 largest long-term vehicle leasing companies in Mexico, by fleet size (source: Fleet LatAm Directory 2020 - based on 2019 data)

How does AMAVe disseminate useful information about renting and leasing cars?

Medina: At AMAVe, we have various internal and external communication mechanisms that allow us to permeate the benefits of vehicle leasing. Among them are public relations, events, strategic alliances and political lobbying.

• Public Relations: We currently play a key role in specialized media that goes hand in hand with our nation-wide strategy to push the culture of leasing. Each quarter, we present information on how the industry is growing.

• Events: We hold various events and meetings throughout the year, in which we focus on strengthening the concept of leasing from different perspectives

• Strategic Alliances: We create ties with recognized institutions and companies which enables AMAVe members to streamline their business operations. 

• Political lobbying: We support the timely management of strategic information related to political-legislative matters which includes issues such as improving the legal framework of leasing.

What is the biggest challenge facing fleet managers in the country and what is needed to overcome it?

Medina: In general, the goal of fleet managers is to have all vehicles operating at 100%. As such, one of the biggest challenges is maintaining dexterity amidst the different government procedures required in Mexico for licensing and registration procedures as well as other issues related to vehicle ownership.

We are also aware of the seriousness of COVID-19 and its effects on society and business overall. For us at AMAVe, we are currently asking the federal government to implement measures to stimulate the economy. Also remember that vehicle leasing is an excellent tool in times of volatility and uncertainty.

Founded in 2015, AMAVe’s goal is to foster the growth of vehicle leasing and management (cars and trucks) in Mexico by bringing together companies which share challenges and opportunities in the industry. It is currently composed of 14 associated members (11 leasing and 3 rent-a-car) which represent more than 50% of the country's vehicle leasing and rental market.