10 nov 21

IFMI 2021: Trust and transparency are top priorities for 2022

The pandemic impacted almost every aspect of the fleet management industry. Its most significant impact has been how it has helped to realize the most critical problems and upcoming challenges in 2022 for the fleet industry. At the Fleet Europe Summit 2021, fleet managers came together at the International Fleet Managers Institute (IFMI) to share their knowledge and create solutions to deal with the uncertainties of 2022. Among the several messages shared, the most important ones appeared to be trust and transparency. 

The International Fleet Managers Institute is an educational initiative from Fleet Europe with the support of ALD Automotive, Arval, LeasePlan, MHC Mobility, and SEAT Cupra. 

For more than 18 years, IFMI has gathered experts from the fleet industry to bring best practices, knowledge and experience into one place and ask the hard questions needed to find solutions to industry challenges. This year, at the Fleet Europe Summit, more than 40 fleet managers were excited to come together after a long year of virtual business experiences. The impact of the pandemic and challenges ahead were discussed, and while optimistic, most experts had already set strict rules for the year ahead while collaborating with their partners to meet these expectations. 

Data is to set the path of electrification

Two workshops influenced the thoughts of the participating fleet managers about the upcoming challenges and helped find solutions to current obstacles. 

Shams Dine El Mouden, International Arval Consulting Director, opened the first session with the question, "How to master the consequences of the pandemic?" 

"The pandemic has brought disruption to business while enabling us to enjoy our freedom from being mobile," said El Mouden, "We are working for a future where we can claim our freedom from mobility, smartly and sustainably." 

The pandemic changed working patterns, reduced mileages and cleared the path for mobility alternatives and electrification. Many employees had a hard time adapting to working remotely; fleet and facility policies had to be updated with a flexible budget due to teleworking. 

While managing car policies brought new questions, reduced mileage was the primary reason to update car policies during the pandemic. An electrification strategy can best be implemented country-by-country, as each one's infrastructures and legislation differ significantly. The type of vehicles adapted and government support are just two aspects that will play a role in EV strategies. 

"Data management and analysis will be critical to see where and how to implement electrification strategies. If there's not enough charging infrastructure and it takes longer for your salespeople to make a trip, then how good can it be to switch to EVs? And which segments provide the best vehicles for a swift transition to electrification?" El Mouden enquired.

Telematics and data analytics will draw the roadmap for electrification for fleet managers. One critical note, however, is building a win-win strategy between partners. This will be a key to success as one-sided efforts will not achieve desired results. 

Transparency is more important than ever 

The second workshop of IFMI was about reducing the impact of the chip shortage on fleets. Ron Betesh, International Fleet Sales Manager, SEAT, opened the session by taking note of the complexity of the semiconductor industry. From design, to equipment, and mining materials, to manufacturing - all processes include different regions and countries. As a result, "Producing one chip takes up to 26 weeks after 600 to 1,200 processes", he said. 

During the crisis, manufacturers temporarily stopped production and chips were allocated to other technology industries. As a result, different production methods for cars, and increased reliance on used cars, emerged as temporary solutions. Moreover, sales recovered faster but without enough capacity from manufacturers. 

So, what did fleet managers do and what will they continue to do in the future to evade the impact of the chip shortage? 

Unfortunately, the chip shortage was perhaps more disruptive than the pandemic with its impact on prices. Increased prices and expectations of an increase in the future are not a good sign for fleet budgets. 

At this moment, fleet managers believe trust is the most important factor to deal with the crisis. An opportunistic approach might emerge, but some delegates felt it may hinder long-standing partnerships. 

Delegates also expressed that understanding between partners and having a level of transparency is critical to overcoming the chip shortage. Negotiations on discounts must come forward, alongside openness and flexibility on delivery times. 

The crisis provided a lesson for fleets to better track their operations for TCO and create new mobility solutions to fight the shortage. As a result, sustainability models in mobility and carbon neutralisation has emerged amid the crisis and this is directly connected with the bond between partners. 

Fleet managers expect a rough 2022 with more extended delivery periods, increased taxes, tenders without discounts and longer lease contracts. One aspect is vital ing the short-term and that is for fleet managers to prepare the best EV strategy and maintain sustainability. 

The overall message from the IFMI is to increase solidarity in the upcoming year. All stakeholders must provide transparency, strengthen trust and thus increase visibility in the market to enable all stakeholders to apply their strategies. 

Here is a video of the highlights of the session.

Photo of the attendants of the IFMI session at the Fleet Europe Summit, courtesy of Fleet Europe.
Photorapher: Benjamin Brolet

Authored by: Mufit Yilmaz Gokmen