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Auto Makers Need to Fess Up on Fleet Sales

Auto Makers Need to Fess Up on Fleet Sales

After the 2009 bankruptcy filings of General Motors and Chrysler, the Detroit Three promised to change their ways and focus on moving more of the metal at retail, only filling fleet orders at volumes proportional to retail sales.

What’s that saying about “some promises are made to be broken”?

I keep hearing whispers, and in some cases, outright shouts, that the Detroit Three are back to their old ways. And some of the import brands supposedly are traveling down the same path.

“Did you hear 80% of a Chrysler minivan’s March sales were to fleet buyers?” an executive from a competing make recently told me. “And Nissan? They're doing lots of fleet."

Too many vehicles sold to fleet customers, and too few to buyers at retail, was one of the oft-cited reasons for the Detroit Three’s woes in the early 2000s. At that time, GM, Ford and Chrysler needed to sell as many vehicles as possible at MSRP, not at hefty discounts to daily rental companies.

Problem is it’s hard to confirm fleet-sales hearsay, as auto makers rarely disclose the fleet ratio per model – heck, it’s like pulling teeth to get a fleet ratio of total brand sales sometimes – and the industry leader in fleet data, R.L. Polk, has stopped doling out such information to media.

Data the auto makers did divulge indicates April was a lower fleet month for many, the Detroit Three included.

However, if there is such a thing as good fleet (the corporate and government fleet sales auto makers love to tout), why not let the world know the fleet ratio for each model line? And why not say what percentage of that ratio was daily rental, corporate and government fleet?

Color me jaded, but when I hear 30% of April sales of the Ford Fusion, the brand-spanking new, real-deal Camry-and-Accord fighter Fusion, were to "good fleet" customers, I'm skeptical, especially because I viewed the supposed in-demand retail car at the Alamo garage in Las Vegas a few weeks ago.

Auto makers being more open about their fleet sales would go a long way toward assuaging concerns the Detroit Three turnaround is smoke and mirrors, and provide a more complete assessment of an auto maker's health to investors, from Wall Street to Main Street.

 

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