Vehicle leasing company Eclipx Group – previously known by its Fleetpartners brand – has acquired car rental business Right2Drive (R2D) for $67 million.
As part of its half yearly company update Eclipx also revealed updates for both the Australian and New Zealand markets on commercial and equipment finance fleets.
Eclipx reported a net profit after tax of $26 million, up 9% from the first half of 2015. New Business Written in the first half of 2016 of $406 million, this is up 14% from the first half of 2015, which the company notes “providing a robust pipeline of future revenue”.
R2D is a leading medium term vehicle rental business and a customer of Eclipx, which provides rental replacement vehicles to “not at fault” drivers that have accident damaged cars requiring repair.
Commenting on the acquisition, Eclipx, chief executive officer, Doc Klotz says: “This is an exciting, synergistic and strategic acquisition providing Eclipx with a platform to expand into the medium term vehicle rental segment providing new and used accident replacement vehicles to “not at fault” drivers.”
“With an existing base of approximately 1200 vehicles operating from 16 branches in Australia and New Zealand, R2D operates in an attractive, high growth and underpenetrated market, characterised by smaller operators that lack the resources to take advantage of growth opportunities,” Klotz notes.
“This market is underpenetrated relative to the UK with a current estimated potential Australian and New Zealand addressable market size of around AUD$550 million of revenue per annum. We estimate that R2D is the largest operator with 7.5% of the total addressable Australia and New Zealand market, with the other market operators making up approximate 10.5% in aggregate.”
Damian Mullins, managing director of Right2Drive who describes the company as ‘the Uber of the smash repair industry’, adds: “We meet our customers usually on what is one of the worst days they will have. Most people only have one car accident in their lifetime and we speak to them just after they’ve had it. They’re frustrated, they’re worried and they’re wondering how they will get by without a car.”
“We move swiftly to turn their negative experience into a very positive one. We set the benchmark in Australia and New Zealand for customer service in our field – we operate 24/7 and we go the extra mile to deliver our customers an outstanding experience.”
Australia commercial fleet & equipment Finance
The Australian Commercial segment maintained a strong 23% growth in new business volumes over the first half of 2015 including winning sole supply of fleet vehicles for a number of government departments and large corporates.
Total fleet and commercial vehicle assets under management in Australia at the end of the first half of the year finished at $953 million.
“Our continued focus on investments in technology and process improvements; initiatives such as our clean energy financing and our telematics capabilities are now key differentiators for Eclipx resulting in increased market-share and providing the opportunity to reduce fleet costs and provide value add services to our customers ,” adds Klotz.
New Zealand commercial fleet
The New Zealand Commercial Fleet segment increased assets under management or financed by 4% in a competitive market.
The 2H16 and FY17 growth in this market will be supported by recently signed agreements with Ford, Subaru and Mazda.
These distribution channels are expected to drive increased penetration of vehicle operating leases into the SME segment using Eclipx on-line vehicle quoting and credit approval platform.
In March 2016, FleetPartners New Zealand also secured management rights to approximately 9000 additional vehicles creating new revenue streams and future cross-sell opportunities.
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