up opportunities for employees who are transferred. In the case
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of maintenance staff, these could come from servicing vehicles apart from Consignia's, because parts of the country are short of CV servicing capacity.
Michael Nuttall, contract hire director of Lex Transfleet, says: "From a commonsense point of view you could not take out that level of workshop capacity and maintain this size of fleet," Lex operates 15 workshops of its own through its ServiceCare division. He adds: "I would rather have lots more workshops operating profitably than close lots of them down:
Different cultures
However Tim Jones, commercial director of Bethell Fleet Services in Manchester, which operates three workshops of its own, says public and private sector operations often have completely different cultures. "Public sector ones are notorious for taking their time, because of custom and practice as a result of only having X number of vehicles to keep running. just staying in control and get. ting the culture and working practices right is hard enough in one workshop. It would be very, very difficult to do it for 185 of them."
Consignia's outsourcing is likely to add momentum to an accelerating trend. Kevin McNally, commercial director of LeasePlan, says: "It will generate a massive amount of growth in the outsourced light commercial vehicle and commercial vehicle market."
The British Vehicle Rental and Leasing Association says contract hire of car fleets is growing by to% a year. Lex Transfleet man
ages more than 20,000, and this is expected to rise to 27,0= by the end of the year.
Arval PHH says it provides a complete fleet management package for 15,o oo CVs, compared with 13,000 last year. Its director of commercial vehicles, Marlyn Lewis, says the growth is partly explained by the decline in residual values of CVs over the past five years. The losses operators would have suffered as a result have instead been shouldered by companies such as Arval PHH. This helps explain why Consignia already leases 35% of its fleet.
"Like cars, CV values go in cycles, with peaks and troughs," says Lewis. "What contract hire does is smooth out those costs, on both the residual values and maintenance."
Simon Chapman. chief economist of the Freight Transport Association, highlights another advantage. "People are trying to avoid paying for things up front these days, and are paying for things as they use them instead."