Between car manufacturers and long-term rental companies, is war declared? While the former are increasing their financing offers and engaging in online sales and rental of cars on subscription, the latter, without neglecting business customers, are also embarking on rental to individuals. It must be said that in ten years, the share of new vehicles acquired by private individuals for rental (LOA, for rental with option to purchase, and LLD for long-term rental) has increased from 10% to 33%. In June 2020, at the end of the first period of confinement, of the 230,000 new cars sold during the month, 80% were financed by leasing with option to buy, according to the French Association of Financial Companies (ASF) . And the acquisition of used cars seems to follow the same path.
“An upset ecosystem”
At present, long-term rental from individuals only represents 5.5% of registrations, yet indicates the Union of Automotive Services Companies in LLD (Sesamlld), but the ambitions of some of its members are important. After seducing large companies, then SMEs and finally very small businesses and the liberal professions, rental companies have waited a long time for the private market to open up to them.
Arval, a subsidiary of BNP Paribas, has just announced that its activities will now target a wider audience through new service offers dedicated not only to businesses, but also to their employees and individuals. Objective: to reach 2 million vehicles under rental contract (including 400,000 in France) by 2025. As explained by Ferréol Mayoly, CEO of Arval France, “The entire automotive trade ecosystem is disrupted by technological change and the emergence of digital technology. This inevitably moves the lines and it modifies the field of activity of each of the actors. However, the development of long-term rental companies in the direction of private customers does not herald a confrontation with manufacturers; we are partners and our activities are inseparable ”.
It is true that manufacturers, through their own banks (financial captives), already compete with lessors in the field of small and large companies. At the same time, the parent company of Arval has seen its traditional financing solutions decline in recent years. “We had to offer LLD to individuals through bank branches, says Ferréol Mayoly. Customers don’t belong to anyone; It is therefore logical that we turn to individuals and to our clients’ employees when they are not eligible for the allocation of a company vehicle. “
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