EV multi-cycle leasing demands sophisticated software says Sofico
Ghent-based automotive software provider Sofico argues that vehicle OEMs need flexible, smart software as growing numbers of them look to offer used-vehicle leases on EVs and keep control over valuable batteries.
Sofico client Volkswagen, for example, plans to offer used vehicle leases on its ID family as a strategy to retain the battery, and believes that secondary or tertiary leases will allow it to recycle battery packs into new uses, including home power centres and fast chargers.
VW believes that battery life could be about 1,000 charging cycles and around 350,000km or about 215,000 miles, meaning it could last longer than the car itself. This will keep RVs high, making secondary leases more affordable.
Leasecos want to control vehicle value for longer
Leasing companies are also looking to retain control over vehicles for longer leasing cycles. The ‘Move 2025’ strategic plan at ALD Automotive (another Sofico client) uses a business model in which vehicles are leased (in some cases) for their entire lifespan, involving multi-cycle leasing, used car sales and multi-channel distribution.
However, this growing development brings its own challenges, not least the need to manage several assets with different leasing cycles and with several different users involved. Many software systems are too inflexible to manage multiple leasing cycles and multiple users across a single asset.
Sofico’s flexible and configurable cloud-native Miles Enterprise Solution, which is used by several OEMs, captives and leasing companies, is capable of managing complex financing and mobility solutions, including multi-user leases of varying durations for a specific asset.
“While descriptive analytics can be leveraged to accurately track and monitor profitability on every cost centre and for each individual cycle,” said Sofico’s Lead Product Manager, Bram Wallach, “thanks to Miles supporting separate cost centre accounting on vehicle and contract, we’re also anticipating the use of machine learning in predictive analytics for decision support in contract management to optimise the lifetime value across the portfolio.
“This could be done, for instance, by combining internal cost information with external market data to highlight for which fleet vehicles a second cycle would make sense.”
Image of Sofico's Lead Product Manager, Bram Wallach, courtesy of Sofico