Yesterday General Motors revealed the new 2012 Malibu. As a certified smart ass, I decided (in good fun of course) to tweet the following, “Fleet managers around the world give the new #Malibu a standing ovation”. I caught quite a bit of flack for that comment but it did get me thinking about the whole negative perception of fleet vehicles.
First I think it’s important for people to understand fleet doesn’t just mean rental cars you book while visiting Mickey & Minnie. For example, in March Ford reported a 29% increase in fleet sales compared to March of the year prior. First thought, “We’ll be seeing plenty of Fiestas at Hertz” – Wrong. If you look closer at the 1Q FY11 numbers for fleet it paints a much different picture. Commercial fleets were up 34%, government sales up 11% and rental fleets down 8%. Instead of offloading at rental agencies Ford is gaining ground in the commercial fleet market.
Too often you’ll hear investors say, “A sale is a sale” when referring to moving metal through rental fleets. While that is true, the average consumers often cringe at the thought of buying a vehicle whose primary place of duty was Enterprise or Avis. I’ve never understood why that is though. Is it because when we rent we shoot for the most affordable vehicle and end up sitting behind the wheel of a Chevy Aveo? Staring at the large bowtie emblazoned steering wheel you are reminded there are no do-overs in the game of first impressions.
I see the rental market as a first date proposition. I can give you a great example of this too. Recently my wife and I flew out to California to spend a week in Napa (Clearly I don’t blog for a living). We arrived at the Enterprise counter and were handed the keys to a Ford Flex. I’d never driven one before – so blind date here I come!
I didn’t climb into a base vehicle covered in cloth staring at a dull center stack. Actually it was quite the opposite. I would be driving a Flex Limited complete with SYNC Navigation, leather, 20’ wheels, and heated seats – overall a very well equipped vehicle. After pairing my phone, setting Pandora to the 90s Lover Station and hitting the 101 I quickly realized this was truly a great vehicle. Would my experience been the same if I were piloting a base model Flex –doubtful.
Granted not all Ford vehicles are this well equipped, but to a family traveling who has an older BMW SUV or Honda minivan at home needing replaced; they might give Ford a chance if their first date with the Flex went as well as mine did. This is why rental fleets, much like dating sites, can be very advantageous if used properly.