Deutsche Leasing’s (DL) UK operation
is holding fast, due to a healthy banking parent, strong
international business connections and a strict commitment to
vendor partnerships.
The lessor, which issues full financial
reports in September, said that new business volume at the end of
H109 was 15 percent up on last year, whereas margins were up by a
significant 10 percent.
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Julian Hobbs, managing director for DL in the
UK and Ireland, said that the stability was “substantially due” to
the company’s vendor arrangements, which between them account for
90 percent of DL’s UK business.
DL, which was established in Britain six years
ago, brought with it a host of partnerships with Germanic
manufacturers, including construction asset manufacturer Liebherr,
laser expert Bystronic, road building equipment producer Wirtgen
and articulated dump truck maker Bell Equipment.
Most of DL’s partnerships as such are in the
mid ticket plant sector, where Hobbs said asset prices are
relatively robust: “We’re very selective about what goods we
finance, and in any case we prioritise asset expertise, so that we
know our exit strategies in the event of a client having
trouble.”
Hobbs provided the example of the print
sector, where international remarketing channels through
manufacturer Koenig & Bauer (with whom DL’s German parent has a
joint venture), provided a solid disposal route in the event of
client insolvencies.
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By GlobalDataDespite DL’s focus on asset valuation, it does
no business in refinancing or sale and leaseback, except in
exceptional cases at the behest of a vendor, said Hobbs.
He added that DL was still happy to take asset
and RV risk on financed goods, and that operating leasing – which
makes up around 35 percent of the lessor’s sales – was still a
“very strong” product.
Hobbs concluded by saying that DL would stick
to its guns in the UK for the foreseeable future.
He said: “The availability of liquidity from
Germany, combined with an open and honest relationship with our
vendor partners, has ensured our success in the current difficult
climate. The reduction in competition from the high street has also
allowed us to increase our returns where reasonable.”
