NEWS PROVIDED BY
Aug 13, 2019, 10:05 ET
SANTA CLARA, Calif., Aug. 13, 2019 /PRNewswire/ -- The global fleet leasing market is forecast to grow by 3.9% in 2019 and reach almost 8 million in unit sales, driven by demand from operational leasing, which is likely to account for 58.5% of the total company cars leased. 2019 is a year of exploring and refining newer leasing solutions in the company car space. It is also a year of intensifying competition where not only lease companies but others in the ecosystem, such as OEMs, start-ups and ad dealers/brokers, battle it out for a piece of this lucrative mobility business.
"SME leasing is poised to be an important target segment in developed markets, while corporate leasing is anticipated to slowly saturate," said Abishek Narayanan, Program Manager, Mobility. "Leasing companies have invested in online marketplaces to serve the B2C segment and drive used car leasing services. With the lease of a high number of quality used vehicles ending in 2019, there is considerable market potential in this segment."
Frost & Sullivan's recent analysis, Global Company Car Leasing Market Outlook, 2019, examines the key trends impacting the fleet leasing market. It identifies the top leasing providers in Europe-included Africa (EIA), the Americas, and Asia-Pacific (APAC). It also analyses the distribution strategy of key providers and the projected volume of the auto leasing segments of operational, financial, and private lease. It covers the regions of APAC; Brazil, Russia, India, Chinaand South Africa (BRICS); North America; Central and Eastern Europe (CEE); North-West Europe (NWE) and Southern Europe.
"Fleet leasing is expected to grow in Europe, aided by new fleet acquisitions in both Eastern and Southern Europe, while true fleet registration in other regions is experiencing saturation," noted Narayanan. "The North American fleet leasing market, on the other hand, is experiencing marginal reductions in new registrations in spite of high growth in Mexico as Canada and the US have reduced their overall fleet purchases."
Leasing is expected to be the favoured funding option for the premium vehicle segment. Car leasing companies are expected to make the most of the additional growth opportunities presented by:
- Partnerships with OEMs and their captives to determine residual values and build profitable business models.
- Investments in developing expertise in residual value estimation and supporting the establishment of charging infrastructure.
- Gaining service visibility among various consumer segments by lowering average lease periods.
- Focusing on self-employed professionals and young entrepreneurs. While the former have better credit ratings, the latter have greater scope in terms of scalability and seek better cash-flow options.
- Development of vehicle subscription business models as they can potentially check falling new sedan sales by offering them at attractive prices.