Long-term grows by 10% but only thanks to the captive market

Long-term rental (Nlt) is on its way to closing a year of over 10 per cent growth in registrations. At the end of November there were 324 thousand compared to 291 thousand in the same period last year. They are ahead by 34 thousand plates and may be more by the end of the year. A sudden recovery after the 2024 setback of minus 18 per cent, which, however, discounted a 2023 in which many old orders that manufacturers had failed to deliver were dumped. All well, then? Perhaps. If we take a closer look, we discover that those 34,000 extra registrations were the result of captive companies, i.e. part of a car manufacturer, which registered around 50,000 extra cars in the eleven months. In contrast, the other rental companies are 15 thousand cars behind. It is fair to wonder how many of those surplus cars have been zero kilometres useful to manufacturers to balance the mix of electric cars and dodge or soften fines.

So if the real market at least has a setback, the question arises as to whether it is legitimate to believe that long-term rental has normal years ahead of it in which it can continue to operate with the same logic, in a kind of business-as-usual, despite the fact that the automotive sector is undergoing a transformation never seen before. The temptation is strong. After all, ever since this service landed in Italy forty years ago, the question has always been how much will it grow and never if. All around, there have been crises, in cars as in finance and currency. The repercussions have been felt in the Nlt, fleet and turnover may have faltered slightly, but the positive trend continued.

Moreover, operators always knew that there was the other great prairie to be explored and conquered, that of personal cars, with VAT number or tax code. Customers who are actually proving to be more difficult than forecast by the rental companies, who had perhaps been a little light-hearted: we supply entire fleets to large multinationals, what problem could a provincial dentist possibly give us? In fact, the bargaining power is all skewed in favour of the charterer. Yet these customers, more like consumers than employees, are hesitating. From 2019 to 2024, their fleet in Nlt grew by an average of just 6,400 units each year, so that their share of the total Nlt fleet fell from 15 to 13 per cent, a sign that the companies, i.e. the mature market, have grown more in the meantime. The rental companies have begun to convince themselves, correctly and even finally, that perhaps their product should undergo some adaptation, that as it is, it is not really suitable for small customers with different habits, needs and values from a fleet. All correct, but perhaps there is more to it than that. This new market is populated by strange people, who think with their heads and then also decide with their bellies, they are careful about how much they spend but above all they care a great deal about being owners, which does not necessarily mean being the great-grandchildren of Verga's Mastro Don Gesualdo, the one who is obsessed with 'stuff'. Apart from the knowledge that the owner with his eyes, and it may be a saying but it is true, fattens the horse, behind this preference perhaps lies that freedom to decide the things of the machine, without external constraints.

Freedom, a value on which charterers should give some thought, and not only to private individuals. Hire is a system, an architecture of goods and services. It contains many things, sometimes more, all within a scheme of time, kilometres and conditions. At a certain time, at certain kilometres, under certain conditions, certain services become accessible. Actions that you not only 'can' do but often 'must' do. This system has found full correspondence when it has been embedded within an equal larger system, the company. We all eat lunch: in the company from 1 p.m. to 2 p.m. We all work: in the company from 9.00 to 18.00. We all change our cars: at the company every four years. If this is the case, what should the renters reflect on? On the fact, which may have escaped most, that with the advent of smart working many patterns have broken down, and we are not just talking about the canteen.

If you are the managing director and you want to have a meeting, it is possible for an executive to connect from the pool where his son is swimming. If the project is to be presented on Monday, you might as well play tennis on Friday, you make up for it at the weekend. In practice, things happen anyway, but outside the box. The structure, the organisation, has left room for individuality. Everyone is less constrained and freer to shape work to their personal needs, preferences and availability. The result does not change, or at least that would be the idea but let us not digress, only that the combination of factors is no longer rigid. Here is the reflection. If the main grand scheme is no longer a scheme, if the important actions no longer fit within an equal space/time, what happens to a small component of that scheme, the company car? Until now it fit comfortably within a system of rules and constraints accepted by all. When those break down, as is already happening, what is the repercussion for the system that governs the fleet, i.e. the Nlt? The company car will always be car, that's for sure. But will it still be company?