What’s driving the global vehicle fleet industry in 2022 and beyond?

From global semiconductor shortages to emissions legislation and expected fleet growth, we take a closer look at the trends impacting the sector and what this means for those managing and maintaining vehicle fleets.

Mazda vehicle processing in LA

Supply shortages prompting preventative maintenance

According to Allied Market Research, the global fleet management segment is projected to reach $52.20 billion by 2030, with other indications pointing to the market value tripling during the same time period. More than a quarter of fleet managers surveyed in the 2022 Arval Mobility Observatory Barometer are also predicting growth in the number of vehicles they operate in the next three years, citing company expansion as the main reason for this increase.

While optimism surrounding future fleet growth is on the horizon that doesn’t necessarily mean the road ahead is clear.

The automotive sector as a whole is still recovering from the ramifications of the pandemic. Global car registrations are in decline. At Automotive Fleet’s Global Fleet Conference in June, it was noted that EU car registrations were down 20.6% in April 2022 compared to April 2021. Decreases of 21.4% were registered in the US and 48% in China. On top of this, most OEMs’ average lead times show that vehicles ordered now won’t be delivered until 2023.

Production disruptions due to lockdowns and ongoing microchip shortages are contributing to a shortage of new vehicles worldwide, meaning companies are having to maintain rather than replace their fleets.

To avoid downtime due to unscheduled repairs and ensure vehicles are in peak operating condition, fleet companies are instead turning to partners who can help with preventative maintenance, including fluid and filter checks, as well as regular cleaning to counteract visible wear and tear.

Processing Toyota vehicles at Guanajuato Plant (23)

Faced with production disruptions and a shortage of new vehicles, maintaining fleets is critical

Technology key to keeping fleets running the extra mile

Alongside preventative maintenance, avoiding unnecessary miles and engine hours and monitoring driver behaviour are other increasingly important considerations for fleet companies.

By implementing fleet monitoring systems companies will see an improvement in efficiency, productivity and safety through real-time tracking of their mobile assets.

The demand for telematics software is predicted to grow 12% by 2023. According to Automotive World, the pandemic has accelerated this growth as businesses that could deliver better when contactless and remote tracking of consignments was the need of the hour, have emerged ahead of their competitors.

It follows that this reliance on technology to optimise resources means fleet management companies increasingly expect their logistics partners to offer similar visibility when it comes to maintaining their fleets, allowing them to remain agile at all times.

EV uptake changing the face of fleets

Government legislation in Europe is also driving a changing fleet landscape. With the 2023 EU ban on new fossil fuelled vehicles fast approaching, EVs are on the rise. According to BloombergNEF, EV sales will hit 20.6 million in 2025, making up 23% of global sales (in comparison to 10% today), with China and Europe accounting for 80% of sales.

While adoption was initially driven by policy and subsidies for EVs, consumer sentiment is also coming into play, with supply now greater than demand in most markets. The result? Fleets where EVs are not part of the strategy risk falling behind.

To keep up with the pace of growth globally, 490 million chargers will be needed. In order to support this transition going forward, fleet companies will additionally be looking to logistics providers with the infrastructure and experience to handle and maintain electric vehicles.

Logistics providers gearing up to meet future needs

From transportation to pre-delivery inspections, storage, reconditioning and mechanical services, the scope of logistics needs for the fleet segment is broad, wide-reaching and specialised.

As the fleet landscape shifts and extending vehicle lifecycle continues to be an important focus, logistics providers will need to offer a spectrum of maintenance and preservation services to keep vehicles in peak condition. Mobile labour services, designed to perform these tasks at a driver’s home or workplace will also add value and enable companies to improve the efficiency and productivity of their fleets and meet their changing requirements in a challenging market.

Fact box: How we support distribution and management for vehicle fleets

We can support a variety of fleet customers ranging from OEMs and their dealers to fleet management companies and auction houses, with services including:

- Mobile labour servicing
- In-fleeting
- Upfitting and customisation
- Maintenance and repairs

Sources: automotive-fleet.com, globalfleet.com, Allied Market Research, Automotive World, fleetnews.co.uk, Arval Mobility Observatory

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