Kwik-Fit Fleet ‘Optimistic’ Business Will Expand in 2010
Mike Wise believes the tough times of 2009 has given companies a ‘work out’ that will enable them to be stronger and fitter in 2010. Talking about the coming year, the Kwik-Fit Fleet head comments “companies are leaner and meaner as 2010 dawns, having already cut operating costs, and that means the industry is in good shape to face up to the challenges of the New Year. Despite the impact of the January 1 implementation of the VAT rise back to 17.5 per cent, we do not expect to see the significant increase in tyre prices that we witnessed towards the end of 2008 and the early months of 2009 as the recession took hold.
“Tyre prices increased by more than 10 per cent during 2009, but I anticipate a period of stability in 2010 unless there is a spike in oil or raw material prices or the pound weakens further against the euro,” Wise continued. “However, tyre manufacturers have reduced production levels and, in some cases, closed factories due to reduced production levels by motor manufacturers. As a result, fleets should be aware that any shortage of some tyre sizes could trigger price rises.
As recently reported by Tyres & Accessories, the recession has meant extra business for the fast-fit giant. “Kwik-Fit Fleet has benefited in the recession from undertaking more mechanical work as fleets extended vehicle replacement cycles and, as a result, cars moving into their fourth and sometimes fifth year of operation,” Mike Wise explained.
“With a complete one-stop shop of vehicle-related services, we are confident of further increasing our servicing and MoT business in 2010, In turn this will offset a lower margin on tyre sales and the reduced demand for tyres caused by the decline in business mileage,” he continued. “While marketplace tyre sales may decline – businesses have, in many cases, cut their fleet mileage through the recession in a bid to reduce fleet operating costs – we expect to expand our market share in terms of tyre-related business as well as mechanical work due to the strength of the Kwik-Fit brand and our nationwide network of centres and mobile units.
“Our fast-fit competition, we know, has had a tough year and as the economy picks up through 2010 and into 2011 we remain optimistic that the Kwik-Fit Fleet business will expand,” Wise concluded.