Leveraging Your Purchasing Power to Build Global Savings

1
'Leveraging Your Purchasing Power to Build Global
Savings'

• Jeff Nichols
• Global Business Development Manager
• Ford Motor Company

2
Agenda

• Global Environment/Background
• Global Customer Demand / Wants
• OEM Response to Global Growth
• Global Complexities / Inhibitors
• Customer Success Elements / Plan

3
Global Environment Changes

• Corporate Consolidations
• Worldwide Economic Downturn
• Realized Globalization Benefits
• Social and Economical Introduction of Euro
• IT Infrastructure Web Enabled World
• An Evolving Fleet Customer

4
Multinational Accounts Prospects 2001-5
Total Global universe equates to 999,398 Units
in Operation 333,132 Annual Sales
5
Global Customer Wants

• Single point of contact at OEM
• Synergies from a strategic global supplier
• Best Practices to overcome obstacles and
  inhibitors
• Fleet operational and financial efficiencies
• Driver/Employee satisfaction
• Cost and complexity reductions
• Sustainability of agreements entire turn cycle

6
OEM Response
7
Global Business Development

• Past
• 7 Years Ago it was developed to handle a few
  U.S. Fleet Customers that wanted to expand into
  the European Market
• Present
• Worldwide Globalization Trends
• Changing Customer Wants
• Customer Benefits/Wins
• Competitive Advantage
• Win/Win

8
Global Fleet Solutions

• Dedicated Global Team
• Central Coordination
• Efficiencies in Consolidation
• Logistical and Legislative Expertise
• Global Experience
• Implementation Process

9
Challenge/Reality

• How Global Customers View FMC
• One Seamless organization with multiple Brands
• How FMC is Structured Globally
• Multiple Brands with individual identities and
  operations
• Individual Brands that operate with individual
  P/L by country
• Most Sales and Marketing organizations operate
  autonomously Country-by-Country and Brand-by-Brand

10
Global Fleet Solutions Team
Global Champions Tier 1

• Jeff Nichols, FMC Global Business Development
• Alan Carpenter Europe
• John Wright - Europe
• Rob Fecher Irvine, CA
• Lianne Daly - Europe
• Simon Rutherford - Asia Pacific and Africa
• Barry Engle - South America, Brazil
• Michele de Veaux - Worldwide Direct Market
  Operations (WDMO)

International
Europe
Asia Pacific
South America
Rest of World
11
Global Fleet Solutions - Team

• International/Pan-European Level Tier 2
• Pan-European Account Managers
• International A/C Managers
• Local Country Level Tier 3
• Brand Fleet Managers
• National Account Managers
• Local Knowledge and Expertise
• Dealer Network (30,000 Worldwide)
• Support and Servicing

12
Global Fleet Solutions - Features

• Long-term partnerships
• Savings and benefits
• Central and Local Co-ordination
• Leasing and Fleet Management
• Proven Local Process
• Implementation guide
• Local meetings

13
OEM Global Coverage
109 manufacturing plants worldwide
14
Selecting the Proper Vehicles/Supplier European
Core Fleet Cars Sales Rep, Sales Mgmt, Mid Mgmt,
Senior Mgmt, Exec

• Small Cars 5
• Lower Medium Cars 25
• Small Minivan 10
• Upper medium Cars 30
• Minivan/SUV 5
• Premium Lower Medium Cars 8
• Premium Upper Medium Cars 13
• Executive Cars 4

75
25
15
Selecting A Global OEM - Additional items to
consider

• Diverse product portfolio worldwide
• Dedicated global team
• Ability to make global decisions
• Fleet commitment (up-fitting, advisory boards,
  etc.)
• Implementation plan
• Residual value strategy/plan
• Safety strategy/plan
• Dealership coverage

16
Global Fleet Complexities / Inhibitors
17
Auto Industry
18
Fleet Mix of Total Industry
Includes kilometric allowance volume, approx 10
of total
19
Tax on company cars (UK)

• Charged to the individual
• Worked example
• Car costs 27,000
• CO2 is 180gpk 22
• Income tax 40
• Annual cost to individual 2,376 or 198 per
  month
• But still less than funding your own car

20
Customer Global Success Elements / Plan
21
Multi-Dimensional Global Customer

• Internal Customer
• Fleet Manager logical, operational
• Procurement / Finance Manager analytical, PL
• Human Relations Manager emotional, employee
  satisfaction

• External Customer (Vehicle Driver)
• Jobber functional, minimum vehicle
  specifications
• Sales Representatives functional, image
• Middle Management/Executives image, reward,
  recognition
• CEO image, reward, status

22
Designing the Proper Game Plan - Success
Elements-
Define Global Vision
Obtain Management Buy-in/Mandate
Construct Roadmap / Timeline
Develop Global Team
Develop Global Team
Team Alignment Goals/Objectives
23
Developing a Successful Global Team

• Obtain Representation from all Regions (NA, EMEA,
  LA, AP)
• Ensure all Corporate Business Units / Divisions
  are involved
• Ensure all Key Operational Departments are
  involved (Fleet Management, Human Relations,
  Finance, Procurement)
• Establish a tie-breaker (senior management
  position or voting mechanism)

24
Benefits of a Global Team Changing Behaviors

• Acceleration of global learnings (cultural,
  operational)
• Development of achievable/realistic global
  objectives
• Strategic alignment (regions, business units,
  departments)
• Excellent assessment of international fleet
  requirements
• Selection of best options and suppliers based on
  demonstrated ability to produce results you want
• Buy-in at All Levels (especially local
  countries) on overall plan objectives

25
Four-way dialog and communication
Customer Central Office
OEM Global Team
Customer Local Country Office
OEM Local Country Office
26
Designing the Proper Game Plan - Success
Elements-
Define Global Vision
Obtain Management Buy-in/Mandate
Construct Roadmap / Timeline
Develop Global Team
Team Alignment Goals/Objectives
27
Benefits of Obtaining Team Alignment on Goals /
Objectives

• Balanced Objectives (corporate, internal
  customers and external customers-drivers)
• Well thought-out execution / implementation plan
• Identification of key measurables and development
  of metrics
• Greater Buy-in / Compliance at the local country
  level
• Identification of Global Suppliers
• Ability to communicate Global plan to OEMs /
  Fleet Management Companies timeline, vehicle
  segmentation, and fleet policy

28
Designing the Proper Game Plan - Success
Elements-
Define Global Vision
Obtain Management Buy-in/Mandate
Construct Roadmap / Timeline
Develop Global Team
Team Alignment Goals/Objectives
Select Supply
29
Internal Customer Global RFP Launch - Sequenced
Process Steps-
Set targets/objectives
Cascade to players HR Procurement
Middle Management buy-in
Policy consensus/revisions
Fleet Analysis
OEM Negotiations
Employee education of targets/objectives
Communicate new policy
Implement
30
Global Needs to Global Offer
Vehicle Segmentation by Country Annual Volume

• Country fleet analysis
• Assessment of needs
• Development of a unique tailored offer
• Identify customer ability to implement Globally
• Identify customer ability to change policies
• Europe 22 countries x 5 Brands 110
  complexities

31
Maximizing OEM Fleet Incentives
Fleet Policy - Leverage Volumes

• Volume Levels by Region Commitment to OEM
• 25 (Four Badge Agreement)
• 50 (Dual Badge Agreement)
• 90 Solus (One Primary Supplier)

44 Manufacturers
32
Global Fleet Support Differences
U.S.
Europe/ROW
18,500
18,500
MSRP
MSRP
Dealer Invoice
Dealer Invoice
Purchase Price
Purchase Price
33
Summary - What do OEMs look for in a Global
Prospect?

• Data collection capability
• Global team representation
• Alignment of corporate business units/regions
• Ability to change fleet policies
• Ability to implement/agreement compliance
• Senior management support/corporate mandate