Following research carried out by Northgate Vehicle Hire into the freight, logistics, post and railway transportation sectors, the market leader in complete fleet management solutions has discovered the sectors are set to increase demand for light commercial vehicles (LCVs) by 8% within the next three years.
The rise in demand for LCVs was attributed to a predicted rise in the forecast of output (GVA) annual growth rate, which is expected to lead to over 140,000 vehicles in use by businesses operating within the freight, logistics, post and railway transportation sectors by 2016.
The research also revealed a rising demand for fuel efficiency amongst fleets.
More and more businesses within these sectors are opting to outsource the management of their fleets to ensure they meet the demands of a growing industry.
As a result the popularity of flexible hire and fleet management has been soaring, due to its ability to support businesses with seasonal fluctuations.
Having the ability to add to or remove vehicles from their fleet at any time without penalty could be the make or break factor for many businesses within the freight, logistics, post and railway transportation sectors.
The needs of businesses within these sectors change with the seasons – and the extent of this can’t always be anticipated – but, for financial reasons, a fleet (which could be anything from one vehicle to one thousand) needs to be utilised 100% of the time.
If it isn’t, then it is a significant financial cost to the business. This is often why hiring rather than purchasing fleets makes more business sense. There is no depreciation, no need to worry about residual value, risks are removed, and the support of the supplier is guaranteed should emergency back up or replacement vehicles be required.
Leasing completely removes any of the constraints associated with contract hire.
The benefits of flexible vehicle hire are currently growing at a similar rate to the spiralling external costs that are currently seen in the market, for example fuel, tyres, oil and lubricants, making it a smart option for business owners looking to operate in a cost effective way.
For further information please visit www.northgatevehiclehire.co.uk Follow Northgate on Twitter at http://twitter.com/northgatevhire.
Jonathan Pearce, Head of Marketing, at Northgate Vehicle Hire, commented:
When growth is predicted in an uncertain economic climate it is often difficult for businesses to fully prepare without parting with large chunks of capital. It’s important for business owners to look at smart solutions to managing outlay of capital. As a company’s fleet is often one of its more costly expenses, it is essential that businesses within the freight, logistics, post and railway transportation sectors seriously consider how their fleets are managed. Opting to lease vehicles as part of a flexible fleet management package is a solution that will see win-win results across the board. We have already experienced a rise in demand for flexible vehicle hire and complete fleet solutions within the industry and feel assured that this will continue as the sector continues to grow over the next three to five years.