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Fleets need to check new entrant Chinese manufacturers for credibility before committing to buying their vehicles, FleetCheck is warning.

Peter Golding, managing director at the fleet management software company, said that electric vehicle (EV) manufacturers from China were undergoing a period of rapid consolidation, and that some were likely to export simply as a survival strategy.

“The Financial Times recently reported that the number of Chinese EV makers is likely to fall from around 50 to 12 in the next decade. That’s a big change in a growing market and it means fleets can’t really afford to treat all of the new entrants as equal.

“Exporting to markets like the US and Europe is one obvious way for these manufacturers to attempt to survive in the kind of disruptive situation that China is seeing, and it seems credible to suggest that not all of the car and van makers who come here will end up staying.

“The potential danger for fleets is that they will end up owning or operating EVs from a manufacturer that comes to the UK and then leaves, with all of the obvious difficulties that could entail.”

Peter said that it was simply a case of fleets doing their homework on potential suppliers before committing to add vehicles to their fleet.

“It is clear that most of the new entrants that we have seen so far are credible. BYD, for example, is the fourth biggest EV manufacturer in the world while MG is a long-established market presence in the UK in its Chinese iteration.

“Also, it is important to underline that the quality of most of the Chinese product that is arriving here appears to be competitive, at least, and well-priced. The comments I’m making are not intended to put people off these cars and vans but simply to tread carefully in light of what is likely to be a fluid situation over the next few years.”

Peter added that it was difficult to predict the eventual role of the new entrants in the fleet sector but that some parallels could be drawn from the arrival of Japanese manufacturers in the 1970s and, more recently, Korean car makers starting in the 1980s and 1990s.

“What we are most likely to see is an initial situation where products are designed to be competitive and well-priced above all else and then, over several years, the Chinese manufacturers with the biggest market presence will start to compete directly with the established market leaders and move their prices in line. However, this is a process that could take some time.

“The big unknown here is the effect of trade barriers, should the EU and other countries choose to adopt them. Certainly, there is a strong argument that the Chinese market has been unfairly subsidised in competition terms, and it is possible that stringent tariffs will be added that affect the speed of market penetration.”

New app tools designed to enable easy checking of abnormal loads have been immediately adopted by a quarter of the UK’s police forces.

The enhancements – made to the FleetCheck Driver app – are already in use by Central Motorway Police Group (CMPG), Cheshire, Greater Manchester, Gwent, Leicestershire, Lincolnshire, Lancashire, Warwickshire, West Midlands and Staffordshire forces.

The tools are based on new checksheets created by the fleet software specialist working in conjunction with National Highways and CMPG, which have also been added to the College of Policing web site. These have been built into the Driver app, with the two main documents covering instances when the police stop a vehicle with an abnormal load or are escorting one through their area. These exist in variants for both UK registered and foreign vehicles.

A driver-facing version of the checksheets has also been incorporated into the app for private companies that specialise in escorting abnormal loads in order to self-audit compliance.

Barrie Wilson CMILT, commercial fleet consultant at FleetCheck, said: “CMPG have been running an initiative called Operation Nightstare that is designed to clamp down on illegal abnormal loads and has found a very high level of non-compliance. The work we have been doing with them and with National Highways is very much designed to dovetail with this campaign, helping operators to meet their legal obligations and the police to inspect vehicles.

“The checksheets have been added free to all commercial users of our Driver app – in use by fleets totalling 220,000 vehicles – and mean that legal requirements can be checked quickly and easily using any smartphone or tablet in a structured manner, helping both compliance and enforcement.”

Marie Biddulph, National Highways assistant regional safety co-ordinator for the Midlands, said “Drivers carrying abnormal loads have a huge responsibility, and it is vital for the safety of all road users that they comply with the appropriate regulations. The work we have been doing with CMPG and FleetCheck will help to ensure that more meet their legal responsibilities.”

The FleetCheck Driver app, introduced in 2017 and regularly enhanced ever since, is designed to streamline legally-required vehicle inspection processes for fleets, removing the need for manual paper trails while also providing additional features such as fit to drive declarations, fuel purchase details and incident reporting.

An abnormal load is a vehicle that has a weight of more than 44,000kg, an axle load of more than 10,000kg for a single non-driving axle and 11,500kg for a single driving axle, a width of more than 2.9 metres, or a total length of more than 18.65 metres.

FleetCheck is debuting the first ever use of artificial intelligence (AI) in its software products with new technology designed to make driver licence checking faster, easier and more accurate.

The enhancement, to the company’s Licence Assured, allows users to upload an image of a driving licence – which can be as simple as a picture taken on smartphone – and its details will be automatically populated into the system.

Peter Golding, managing director, said that the tool would allow slicker and more precise data entry for fleets wanting to add new drivers to the system in order to undertake licence checking for essential health and safety purposes.

“In using AI for the first time within our fleet software, we decided to take a proof of concept approach, automating a single task that we know takes time for our users and making it faster, easier and more accurate.

“Now that we know the core idea works, we will be able to use the same principle across a wide range of other processes within our product range, especially when it comes to sorting documentation and collecting data. It perhaps looks like quite a small step forward but the potential applications are extensive, we believe.”

He added that the idea behind the technology was straightforward but the coding required had taken a substantial amount of effort.

“What we have learnt about AI in creating this new tool is that employing the technology is not necessarily easy. To get this to a stage where the data is reliably and accurately extracted has taken quite some time. It is not something that we expect to see be rapidly adopted across the fleet software sector for this reason.”

Licence Assured is FleetCheck’s driving licence checking product, designed to enable fleets to quickly and easily look at the vehicles which employees are eligible to drive and to check their licence for points and convictions. Checks can be automated to happen at predetermined intervals and based on individual risk profiles, with data presented in a dashboard format.

FleetCheck are exhibiting at Fleet and Mobility Live at the National Exhibition Centre, Birmingham, on October 3-4, on stand P75.

Fleet purchasing of supermarket petrol and diesel has fallen by around 15% on last year, FleetCheck is reporting using data from across its user base.

The fleet management software specialist says that the trend has emerged following widespread accusations that supermarkets have profiteered on fuel following the Ukraine war, with the government discussing making the publication of live fuel prices compulsory in response to the controversy.

Peter Golding, managing director, said: “There has been much discussion about the pricing of supermarket fuel over the last year or more, with the RAC reporting as recently as last month that their margins had doubled and they were failing to pass on reductions in wholesale prices at the pumps.

“Fleets are clearly cognisant of these developments and they appear to have had a direct impact on fuel purchasing among our users. A 15% change such as this over the course of a year is a pretty significant shift and shows that businesses are skewing their petrol and diesel purchasing towards other sources.

“We wouldn’t claim that this is entirely representative of something that is happening across the entire industry but from the fuel data we hold, there is clearly a trend underway.”

FleetCheck’s data is based on almost 430,000 transactions through its software during 2022 and 2023.

Peter added: “The ability to track fuel spending using data from fuel cards is one of the most important uses of fleet management software and many of our users regularly examine the outlets that their drivers use and steer them towards cheaper options.

“Since fuel prices began to rise sharply at the start of the Ukraine war, we have seen a more proactive approach as fleets have attempted to use our reporting to minimise the impact of those cost increases. It very much appears as though the move away from supermarkets is a direct result of these strategies.”

Car and van lease contracts and warranties should be moved to align with the new real world fleet replacement cycles that have emerged following the pandemic, FleetCheck is advising.

The fleet management software specialist says that cars across its user base are now generally being operated for close to five years compared to 3-4 previously, while vans have moved from around 5-6 to up to 7-8.

Peter Golding, managing director, said: “Post-Covid shortages have meant most fleets have been forced to operate vehicles for much longer than originally planned and, in the process, have learnt that they can be safely and economically be operated on longer cycles.

‘If you add to this the higher initial prices and uncertain residual values of electric vehicles pushing up costs, then there is considerable overall impetus to lengthen replacement cycles permanently, and this is something that we are starting to see happen on a formal basis with many companies now leasing for longer periods as a matter of course.”

The main issue around these lengthening cycles was the need for businesses to upgrade their service, maintenance and repair (SMR) arrangements, he added, and there was a strong argument that longer manufacturer warranties should form part of this move.

“While modern cars and vans tolerate age and mileage much, much better than in the past, they do inevitably need higher levels of maintenance over time, especially when it comes to the kind of unexpected breakdowns that cause the most disruption.

“What we feel really needs to happen now is for manufacturer warranties to align to these new cycles. Obviously, some do offer warranties ranging from 5-7 years but there are several major fleet car and van makers who only provide three and, to our mind, this is inadequate for modern fleets and the lengths of time for which they now operate vehicles.

“Of course, extended warranties mean manufacturers are likely to keep SMR within franchise dealer networks for longer, so this is something that potentially makes sense for all.”

Peter added that there were human resources considerations around longer replacement cycles but that, from the feedback it was receiving, objections from drivers were limited.

“To some extent, this is sector-dependent but in many industries, most car drivers are accepting five-year replacement cycles. Modern vehicles don’t just last for longer mechanically and electrically, but they are also better cosmetically over time. Employees are content to keep a car for longer if it stays looking good.”

More than one in five vans (20.8%) across FleetCheck’s user base don’t meet the requirements of London’s Ultra Low Emissions Zone (ULEZ), the company is reporting.

Peter Golding, managing director at the fleet management software specialist, said the statistic provided an indication of how many businesses could potentially be affected by the extension of the ULEZ at the end of August.

He explained: “To be clear, this is a figure that shows the proportion of non-compliant vans across our entire national user base, not just within the ULEZ, but it does indicate that a substantial minority of fleets are still operating pre-Euro 6 vans – and there is no real reason to believe this is not happening within the ULEZ zone in the same way as elsewhere.

“This is especially the case given the widespread extensions in replacement cycles that have been taking place since the pandemic. We now have many fleets that are operating at least a few vans that are 7-8 years old and will therefore probably be non-compliant.

“Of course, it is likely that there are many more vans of this type being run by sole traders and microbusinesses that fall outside of the mainstream fleet industry and would not be included in our data, so the proportion of non-compliant vans that will be affected by the ULEZ extension could be quite a lot higher than one in five.”

Peter said that the most obvious strategy for tackling the extended ULEZ was for companies that operate in the zone to swap compliant and non-compliant vehicles to ensure that the right vans are in the right locations.

“We know of several fleets that have done this but it is an option that is only open to those with wide geographical coverage and relatively large fleets. For all others, the only solutions are to pay the ULEZ charge or buy a compliant vehicle and neither of those options are cheap.

“We are highly sympathetic with the aims of the ULEZ – everyone deserves to live in a place where the air is safe to breathe – but its introduction is potentially hitting businesses just when they are under quite a lot of economic pressure, and when both new and compliant used vans are in short supply. It’s unfortunate timing.”

Fleets need to do more to deter criminals employing high-tech methods who are behind a 25% year-on-year increase* in car thefts, says FleetCheck.

Peter Golding, managing director at the fleet management software company, pointed out that awareness of how to stop methods such as relay thefts and key blocking remained patchy among vehicle operators.

“Feedback from our client base indicates that fleets often know thefts are an increasing problem but while some are being very proactive, others are poorly informed about the methods that thieves are now using and how to deter them.

“We’d like to see much more of an acknowledgment that this is becoming a genuine issue and agreement on best practise that can help to stop company cars and vans being stolen.”

Peter added that many of the most effective methods of protection against high-tech car theft were relatively simply and inexpensive.

“In the case of relay theft, it can be an issue of putting the key into ‘sleep’ mode, which some models allow, or placing it inside a Faraday wallet to disrupt the signal, something that costs just a few pounds.

“Interestingly, some security experts recommend meeting the high-tech approach of the thieves with pretty low-tech responses. If someone is creeping onto your drive armed with a laptop, then an old-fashioned steering lock stands a good chance of deterring them.”

He added that fleets both needed to brief drivers about the potential for high-tech theft and explain what is needed from them in terms of protection.

“This is an area of fleet management where driver buy-in is crucial but can be difficult to generate. For company car and van drivers, a car theft can be seen as an inconvenience rather than a major worry and employers need to make it clear that they expect certain measures to be met, such as where vehicles are parked and keys kept, for example.”

*Office for National Statistics, May 2023

The company questioned customers who have recently started using its products and the leading reason, mentioned by 30%, were difficulties using spreadsheets alone to look after key aspects of their company car and van activities.

Peter Golding, managing director, said: “Many, many businesses use spreadsheets to manage their fleet but they find that, if they have anything more than a handful of vehicles, the limitations become very obvious, very quickly.

“In our experience, the more that fleets ask spreadsheets to do, the more their frustration increases and a kind of spreadsheet fatigue sets in. The advantages of switching to specialist fleet management software become very apparent.”

Other top reasons mentioned in the research included the desire to digitise vehicle checks and defect reporting (29%) and concerns about missing key dates (16%).

Peter added: “Compliance is becoming an ever more important driver for users of fleet management software and again, something that is really very difficult to achieve with a paper or spreadsheet-driven approach.”

FleetCheck is currently enjoying record levels of business, having signed up 39 new customers in May alone, bringing the total for 2023 to 154.

“We’ve been investing heavily in our product range over the last year or so, with the latest version of our core fleet management software powered by a new technology stack launched at Commercial Vehicle Show in April There is a definite sense of momentum around the company and it’s an exciting moment.”

Any forthcoming “step change” advances in battery technology would represent a double-edged sword for fleets, FleetCheck is warning.

Peter Golding, managing director at the fleet software specialist, said recent press reports suggested that major advances could potentially be on the way and their effects could be predictable.

‘We’ve reached a stage in the last few years where any improvements in the range, charging speed and durability of electric vehicles (EVs) are generally expected to be incremental, with questions of core battery technology largely settled.

“However, it looks as though step changes might still be possible, with recent announcements on Toyota’s solid state designs, CATL talking about doubling energy density, Mullen Automotive improving battery management and more.

“On one hand, these are good news. Anything that makes EVs more practical is to be welcomed, especially in the van and commercial vehicle sector where existing technology is presenting fleets with tricky issues but it also creates problems.”

Chief among these, Peter explained was the possibility that a step change in battery technology could cause substantial harm to residual values (RVs) on existing EVs.

“A manufacturer who has access to better batteries is going to want to make them available as soon as possible in order to gain a competitive market advantage but this is going to affect EVs already in use. It won’t render them obsolete but it could make them much less attractive, especially if the new tech is not just more effective but cheaper, which is conceivable.

“It’s not impossible that a business could buy 100 EVs today and then, a couple of years later, see their value dramatically affected. RVs are unlikely to collapse completely – these will still be practical, attractive vehicles for some used buyers – but there could be major reductions.

“This would have a substantial impact on leasing companies too, of course, who are already being very conservative in their EV future forecasts thanks to the quite dramatic drop in values seen over the last year. Buying EVs and bearing the RV risk remains a risky business.

“It seems to us that there is no way around this situation. EVs are still a relatively new technology in a mass market sense and step changes in technology are very much a possibility but any advances will probably be a double edged sword and fleets need to factor that into their decision making.”

Some fleets are starting to take service, maintenance and repair (SMR) management back in-house, reports FleetCheck, in a reversal of a trend towards outsourcing that has been underway for decades.

Peter Golding, managing director at the fleet software specialist, explained that the move was being prompted both by both electrification and the general ageing of the fleet vehicle parc that was currently underway.

He said: “There’s a growing perception among fleets that what they are being charged for SMR by third parties, especially leasing company maintenance packages, is overinflated and outweighs any expertise that third parties bring when it comes to SMR buying.

“To an extent, it’s easy to see why this is happening. Some SMR providers who have limited experience of maintaining electric vehicles, and older cars and vans, have perhaps been pricing well on the side of caution, and some fleets have noticed where this is the case.

“As a result, we have seen a growing interest in using our software to bring SMR back in-house and fleets are relearning skills in this area that have been outsourced to third parties for decades, such as identifying the best suppliers and interrogating workshop bills.”

Peter said that the solutions adopted by fleets managing their own SMR depended very much on factors such as the vehicles they were operating, their geographical footprint, and the complexity of their maintenance needs.

“If you operate a relatively straightforward fleet on a more local basis, then it can simply be an issue of creating relationships with a handful of nearby workshops, especially if you use fleet software to provide a managerial infrastructure.

“Conversely, if you have many different types of cars and vans, and your vehicles are used on a national basis, then there are extensive networks of SMR providers that you can plug into, and we have existing arrangements in place that our users can easily adopt.

“Certainly, some of the fleets involved are making considerable savings compared to the third party costs they were paying previously.”