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How can businesses overcome the van and car rental shortage

The global vehicle rental market is in flux. As the country returns to a form of new normal, companies are having to pivot to meet the needs of a customers looking for more in every aspect. From expecting personalised services that add to customer experience, shortlisting nothing but sustainable alternatives of transportation to demanding higher levels of transparency and affordable pricing structures, the end-customer wants it all, and more.

In light of heightened customer expectations compounded by a country suffering from a shortage of vans, let’s take a look at the way forward for rental operators.

Today, 1 in 10 workers rely on a van to do their job. It’s no exaggeration to say that a critical shortage in trades people's main mode of transport is intensely damaging to national business and GDP. Rental operators are feeling this pinch, first hand. However, there are strategies you can put in place to mitigate the worst of the damage these shortages could do.

High on demand, low on supply

Here’s a snapshot of a recent BVLRA poll and report on the combustion and electric van market:

However, the market is going through somewhat of a growth moment, with:

This is also on the back of 71% of respondents expecting to increase the size of their fleet during the rest of 2021. This is not a sign of a market in the doldrums, but if shortages of vehicles persist, it would inevitably stifle growth across the van purchase and rental market, hamstring business and depress the market exponentially.

The main reason manufacturers are delaying roll out of new vehicles (and the car market was down 52% in May 2021 compared to May 2019) is primarily to the global shortfall in semiconductor production, and the rising cost of raw materials such as steel, copper and oil which, of course, impacts customer cost.

The Society of Motor Manufacturers and Traders (SMMT) predicts delays of van deliveries running into 2022. The shortfall cannot be met by EV production - despite 1 in 5 vehicles made in the UK now being alternatively fuelled, they are not produced enough at scale to make up the numbers, and the vast majority of cars produced in the UK are for sale abroad.

How should operators deal with van shortages?

Here are some alternative approaches companies could use to support fleet numbers:

  1. Looking at leasing deals rather than purchasing options

  2. Focus on lower emission models (as these are being prioritised)

  3. Re-strategise fleet placement based on changing customer use i.e. redeploying airport fleets at other venues

  4. Consider cut options on vehicles in the short term i.e. deal with manufacturers who are rolling out cars with more analogue display options rather than digital ones, as these are quicker to produce

How can customers find a solution?

Communicating how shortages will affect your customer base is only as effective as the solution you’re offering. Customers want answers, direction and clear communication. They don’t want opaque offers of potentially replacement vehicles. Your value proposition has to offer something better.

Utilise whitelabel websites and apps to reach customers searching for local operators amidst the shortage

Reach out to end-customers turned away by the Big 5. Specialist tech companies like Coastr can help launch your brand online via whitelabel website or app.

  1. Through our white label website/app services, we provide a fully functional vehicle rental app ecosystem for you and your customers, which you brand and release as your own product. All of the work has already been done - all you have to do is launch the app and immediately benefit from real time fleet management AND integrated customer management.

  2. Customers want efficiency of service, a digital solution and real time information on fleet services, options, and price - they do not want to be stuck on phones, or trying to navigate a website, especially at the initial visit. An app offers an easy solution where the data is readily available to make a purchasing decision.

  3. This is especially beneficial for smaller, more local companies. Rather than competing with the Big 5, use your app and website together to draw new customers to you who are either dissatisfied with the larger branded nationals, or who want a new source of rentals local to them.

Use social media as your main lead generator!

  • The first thing new customers are going to do when searching for rentals is hop online - your social media profiles, google business page, SEO, marketing and outreach all play a huge part in your online visibility.

  • Use social media to get the jump on your competitors and directly communicate with customers. You can highlight fleet specifics, run advertisements, highlight deals and do it all via well positioned placement on social channels. Use this massive world to your advantage!

Coastr has a Social Media Pack, developed specifically for independent van and car rental companies looking for hints, tips and guidance on how to grow their businesses on social media.

You can download it for free!

There is no quick fix in dealing with van shortages and pressures on fleets. Vehicle rental operators must build on effective mitigation, extended ordering times, enhanced communication, consistent marketing, and a well-supported business model that can react quickly to changes in demand and guarantee swift maintenance and turnaround to counter the crisis.


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