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BMW to take more consistent approach to leasing company relationship

the bmw m3 cs
M3 drama. But BMW wants a more even relationship with leasecos

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5 December 2017

Steve Oliver

IT’S been a year today (Dec 05, 2017) since Steve Oliver took over as head of BMW Corporate operations (pictured left).

Having spent two years running his own consultancy business, and prior to that heading up Infiniti northern Europe, Steve says it’s “quite a machine to take on”.

But he’s now fully up to speed with the organisation and the many BMW Group products, Steve has been examining how BMW can improve its business relations with the leasing companies.

And clearly he sees more opportunity for both BMW and the leasing companies thanks to a redefined offer.

“I expect to see some growth in the leasing channel,” says Steve.

“Our standard leasing offering will be more competitive. And it will be more competitive on a day-in and day-out basis – so I’m expecting to see growth with the leasing companies.

“But while our standard leasing offering will be more competitive, we will reduce tactical volume to focus on the standard leasing programme.

“It’s all about making it easier for leasing companies to do business with us. And while we recognise there is an increasing amount of PCH business out there, our clear focus is on business contract hire.”

Last month BMW held its Directors’ Forum at Soho Farmhouse in the Oxfordshire countryside. “It’s a great way for us to engage with senior people in leasing companies and explain our plans – whether that’s our future direction, the products we’re launching or explaining some of the services such as Connected Drive we will be offering – and have a Q &A session. It gives leaseco senior executives a steer for the next calendar year.”

Oliver said one of the items up for discussion was the WLTP rules and how that was going to impact on car choice. “WLTP is still in its formative period, but we had a chance to discuss that and to explain how it works.

Brand new BMW X2 - coming to the UK next year
Brand new BMW X2 – coming to the UK next year

“We also gave them a chance to drive the new BMW X2 and discuss it afterwards. The opportunity for dialogue is always important.”

And while the Directors’ forum is an annual event, Oliver says the leasing team is in front of the leasing companies updating all of them all of the time with the new product reveals.

The need to do the right business for corporate customers

I asked Steve whether his recent pronouncement that ‘diesel was the future’ when all around diesel was being vilified was a case of something he knew that we didn’t?

“It’s about the right drivetrain for the right application,” explains Steve.

“There are plenty of ways for the taxation legislation to be used differently for individual purposes – and that will be individual choice. But what they must do is make the right decision for the driving they do.

“So is a PHEV the right powertrain for 500 miles a week?

“We’ve been advising customers and working with them on those decisions – and that is our challenge to convey that information to them.

“I was in a BMW retailer recently where two drivers were doing 20,000 miles and 25,000 miles a year respectively – such distance is not conducive to PHEVs. But on the other hand it’s hard for fleet managers to negotiate around the fiscal structure which makes PHEVs look tax-advantageous. But for those two drivers, diesel is the ideal drivetrain because of its efficiency.”

Steve says BMW recently took some senior infuencers to Munich for a workshop to an inner circle think-tank on powertrain development.

“The 48V technology coming in on petrol and diesel products will be another conversation point as to how it impacts the market,” explains Steve. “You can have an even cleaner diesel car with mild hybridisation which isn’t quite on the radar of those drawing up legislation.

“It’s the thing in industry, particularly now, where tech is moving so fast the legislators cannot keep pace. It’s not a simple petrol/diesel/PHEV debate. It’s far more multi-dimensional than that.

“But diesel is a future fuel for fleets. And I can say that with confidence because I have a suite of EV and PHEVs on their way too.”

Fabulous new BMW i8 Roadster joins BMW's EV line up
Fabulous new BMW i8 Roadster joins BMW’s EV line up

Sporty EVs – i3s and Roadster: is there a plan to sex them up?

Turning to the companies most recent EV announcements, the BMW i3s and the BMW i8 Roadster, is this a move by BMW to ‘sex up’ the image of EVs?

“I think the performance both cars deliver is very sporty anyway, irrespective of how they are dressed up. With both cars they are ahead of their time and we will review what improvements we can make. So for i3 to supplement REX we wanted to reach a wider audience and being more explicit with the sporty dynamic that makes it easier to communicate.”

BMW X3: more powertrains on the way
BMW X3: more powertrains on the way

And, as if to make Steve’s point that diesel is still a future fuel for fleet, the new BMW X3 has been launched with just diesel powertrains, although some electric variants will enhance the range before the end of the year.

“The one thing I would like to say to the leasing companies is that I think there’s more exciting development in powertrains to come with EV and PHEV versions but, also some exciting diesel and petrol developments, too.”

To finish off, what would Steve would like to achieve with leasecos in 2018?

“The key for me,” says Steve, “is a more consistent level of business on a month-by-month basis.

“Certainly all the reviews through Fleeteye say we are the top performing premium brand so we’re doing a good job there, but obviously we can do better – that’s by listening to our partners and being mindful of some of the challenges they face.

“And from all encompassing standard proposition we’ll be very competitive in 2018. So revised terms have been issued to all leasing companies – and I would say this: if you need more support, we’re here to help.”

Who is there in the BMW corporate department to service the leasing companies?

  • Adam Harley – national leasing manager

    David Tuckett BMW
    David Tuckett BMW
  • Dave Tuckett – key account national key accounts and public sector (pictured right)
  • Danny Marinovic – SME programme
  • Lee Connolly – rental and specialist sales
  • Hannah Bishop – EVs and PHEV hybrids
  • Amanda Hook-Brown – Strategy and operations manager

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