Fleet business growth opportunities in emerging markets (Brazil, Russia, India, China)

Munich, March 2014: Western OEMS are facing ever more saturated domestic markets,including the fleet segment. Particularly in Europe, OEMs are having trouble growing their market shares in this area. For example, OEM fleet business accounts for 62% of sales in Germany, 54% in the UK and 48% in Spain. These are the findings of the new Roland Berger study entitled”Fleet business in BRIC and emerging markets”.

The picture is different in the BRICs and other emerging markets with fleet business less well established than in Europe. For example, fleet volume in China makes up just 9% of the national car market; in India and Russia, the figure is 13%. “This shows that the BRICs in particular still offer great growth opportunities for western OEMs,” explains Marcus Hoffmann, Partner at Roland Berger Strategy Consultants. “But they need the right market strategies tailored to each country. European business models cannot be transferred directly to these markets.”

Fleet business BRICFleet business growing in emerging markets: The potential of fleet business will be driven by trends in the international car market. The experts at Roland Berger predict that by 2019,some 20 million more new cars will be sold worldwide. The highest growth will be seen in India, with sales rising 9% annually, China (+7%) and Eastern Europe(+5%).

“To tap into the great potential of these markets, western OEMs should start working now on a market-specific strategy,” advises Roland Berger automotive expert Jan-Philipp Hasenberg. “This first involves a precise analysis of the market: OEMs should know the structure and size of the local car market, the regulatory environment, customer needs and competitors inside out.”

It is also essential for new market players to have in-depth knowledge of the fleet business in a particular country, for example the local sales and organizational structure and the current status of the fleet business. Only then can OEMs adapt their fleet strategy to suit and optimally serve that market. “Car companies should then translate this new market strategy into suitable processes and organizational structures;in other words, take account of them in their planning, acquisition and sales strategy.That is the only way for OEMs to successfully tap promising markets,”Hoffmann concludes.