GE Capital: the challenges and opportunities of fleet management

There are more strings to GE Capital’s bow than just financial solutions. Its fleet services cover over 200,000 vehicles in Europe and will get customers where they need to be

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Maurice Benisty, CCO of GE Capital International

GE Capital is a major supplier of vehicle leasing and fleet management across the world. Effective fleet management can be a highly efficient way of reducing costs and optimising the everyday running of a company’s operations. Maurice Benisty, GE Capital International’s Chief Commercial Officer, spoke to European CEO about the challenges and opportunities fleet management services can bring.

We believe we are one of the few market participants to be able to compete on a truly international level

What are European fleet managers focusing on currently, and what trends are affecting their decisions?
Within our fleet operations, we will continue to serve larger customers who can benefit from the services we offer – such as our Key Solutions consultancy, our focus on total cost of ownership (TCO) and our global reach.

Reducing TCO remains the clear priority for our customers, and we provide consultancy services to help them manage this.

Driver safety is an important focus area, especially at the global decision making level. We have developed a range of tools, training and services to help customers in this area.

Telematics is an underpenetrated element of fleet, but represents a keen area of interest for fleet managers and we aim to leverage this technology more to improve productivity
and safety.

What are the opportunities that arise from globally managed fleets services?
Our global reach is one of our differentiators and we think this is key as we are seeing an increasing amount of global tenders, and more of our pan-European base is asking us to support them from a global perspective. We believe we are one of the few market participants to be able to compete on a truly international level. Within Europe, 50 percent of our vehicles are from customers we serve in more than one country. This enables us to operate on a local level, but benefit from the expertise and infrastructure associated with having global reach.

The complexity of a multinational organisation is the biggest challenge. We see this in global tenders: there is a desire for standardisation, but that’s not necessarily in line with what each country wants to achieve. So I think you have to make hard choices about the extent to which you want to standardise and work with a global provider. The more complexity you create, the harder it is to drive the cost benefits that come from global contracts.

What are the primary costs associated with managing a fleet, and what services does GE Capital offer to help manage them?
For the last 10 years, GE Capital’s Key Solutions consultancy team have been helping GE’s customers manage their total cost of ownership.

The main costs that impact vehicle management are vehicle depreciation, fuel, services and taxes. The Key Solutions team can assist with costs aligned to carbon dioxide emissions, sourcing and vehicle acquisition methods and fuel management. Guides and tools are available through our websites, but we can work much more closely with each company to help identify cost savings throughout the customer lifecycle. Our current top four cost-out areas are optimised sourcing, fleet TCO reduction through dynamic carbon dioxide capping, best financing methods and optimal car choices. But our consulting team is able to lead missions from a broader library of more than 60 different fleet cost-out options. The team is consistent in its methodology and outputs across Europe, the US and our APAC operations.

How important is the fleet services business to GE Capital?
Globally, we have a million cars. About 400,000 of those are in the international business – our business outside of the US – and those are split evenly between Europe and Asia. That makes us a major provider of fleet services globally. We’re very focused on growth, and this means growing all of our commercial entities and businesses.

We want to become the global lender of choice for global sponsors, vendors, and mid-market companies, and our strategic plans are focused on achieving this. GE Capital International is a large operation, delivering over $11bn (just over €8bn) in revenue in 2013, and with operations across 30 countries.

Our fleet business is one of our core commercial leasing and lending solutions. For us the fleet model is a great fit: a combination of asset funding and operational service delivery. This is an area where GE’s strong process excellence controls and rigour allow us to excel.