The digitisation of life is having a major impact on the automobile landscape. As virtual shopping carts fill thanks to growing online commerce, more and more light commercial vehicles (LCV) are being purchased to carry goods from warehouses to the consumer. This has created a new business model for many companies. As a result, sales of these vehicles have grown by more than 11% per year since 2013, according to the European Automobile Manufacturers' Association. LCVs are coming, and here are five fast facts about them you need to know.
By the number
Smaller and more agile than large trucks, LCVs are able to move merchandise quickly, particularly in cities, and are beginning to make up a considerable proportion of fleets. Of 650,000 vehicles in Alphabet's portfolio in February, 2017, 83,000 were LCVs. For all companies, large and small that are building up a delivery service or have an existing one, LCVs are an important tool. As experts in fleet management, leasing providers like Alphabet can make important recommendations based on their experience.
Covering all bases
LCVs are different from passenger cars and therefore require a different service level. Drivers have to make many stops, open and close doors and hatchbacks, and often reconfigure the interior, causing wear and tear on seats and moving parts like hinges. A full service agreement that covers servicing, maintenance and repair work becomes essential, in order to give the owning company peace of mind. This is especially important for small and medium sized enterprises, which often do not have a dedicated fleet manager. And part of the services offered is driver training for these vehicles, to lower accident rates and wear and tear on the car.
More than just a car
Light commercial vehicles weighing up to 3.5 tonnes have a clear set of functions: to transport goods door-to-door. Not all models are alike, and individual businesses should make sure they have the right vehicles for the jobs on hand. Just buying any low-price LCV might increase expenses down the road. The needs of the driver and the kind of freight being carried must be taken into consideration. Most LCVs, therefore, should be professionally retrofitted, which is a task Alphabet outsources to trusted external partners.
A key question with LCVs is this: Should the vehicle run on petrol, diesel, or electricity? A competent leasing partner will assist with an Electrical Potential Analysis (EPA) that studies driver profiles and the most common routes. The German Post Office – Deutsche Post – for example, an Alphabet client since 2014, currently has 2,500 electric Streetscooters in service and is planning to double that number by the end of 2017. These so-called electric light commercial vehicles (eLCVs) are quiet and can be recharged with electricity generated from renewable sources. They are sometimes subsidized by governments and will provide access to the restricted zones of many cities, like Milano.
Connectivity is allowing new business models and improved efficiency of fleets. It is a key component in automated driving, which is about to extend to LCVs. Those companies ready to take on new technologies have the possibility of developing new and profitable business models. In addition, self-driving cars or eLCVs are expected to optimise vehicle utilisation rates considerably and reduce total cost of ownership to 50%.
Have these five LCV facts whetted your appetite for more information? Or do you have questions or some information you would like to add? We welcome your views in the comments section below.