18 oct 17

Aligning global fleet policy with local needs in Peru

Aligning multinational fleet policy is beneficial for creating economies of scale, standardised processes and optimal fleet function. It also involves many stakeholders: human resources, purchasing, sales and finance, all of whom have their own expectations and objectives.

Complexities of different methods of acquisition, taxation and other regulations make it difficult to unify policy globally and Peru is a particularly interesting case. The Peruvian fleet market is young, the country’s road infrastructure challenging, plus it has its own unique culture. Trying to implement initiatives that work in mature markets will not work here.

Peru’s fleet car brand preference

The type of vehicles acquired as benefit cars for top executives in Europe, for example, are different to those that suit Peruvian business people. BMWs and Audis are not popular, whereas Toyota, Hyundai and Kia are. There is no domestic production, all vehicles are imported and Peru has a long association with Japan. The country also has free trade agreements with 38 countries including the Association of Southeast Asian Nations (ASEAN) and China.

Fuel is expensive as domestic production is insufficient to supply demand so much of it is imported. This has a bearing on the type of vehicles suitable for fleets. The job/position-based vehicle selector list may need to be tweaked for Peru.

The need for a customised fleet policy

Fleet policy must meet the needs of the company, that’s obvious. But it must be customisable regionally and locally to meet the requirements of end users, leverage the capabilities of suppliers and accommodate legal, financial and ethnic differences without violating the core program.

There are an estimated 30,000 fleet vehicles in Peru but only 2,000 of them are leased. The aftersales market is patchy making it difficult to get a consistent quality of service but it’s improving as businesses like Arval Relsa and ALD have established sales operations in Latin America (including Peru) to offer a fully outsourced fleet service, thus pushing up the standards. Since more then 10 years Arval Relsa is the market leader in vehicle leasing in Peru with a market share of about 25%. 

Defining and benchmarking policy is a good thing in terms of rules around vehicle usage, maintenance and repair, driver safety, use of mobile phones, accidents, fines and so on but the advice in Peru is to create a local user guide that stipulates rules, regulations and policies, brand and model selection, optional equipment and so on. Employee buy in can be encouraged by placing the emphasis on the importance of the policy for corporate goals and the good of the employee themselves. 

Authored by: Alison Pittaway