Leasing Life editor Brian Cantwell caught up with DLL CEO Bill Stephenson after his speech at the conference for more insight into the steps the industry must take to raise its profile and to keep ahead of the curve.
Leasing Life: What are the biggest challenges for the European leasing industry in 2015?
Quite frankly I think each country should have representation to come together as a body and evaluate the challenges of the European Union regulatory changes, which is really throwing us into the same bucket as consumer lenders and banking lenders, and educate them on the fact that our business model is different; that we really have a huge impact in the economies of the countries that we represent; and that we are knowledge and asset lenders, we’re not just money lenders.
We have the services and solutions that help companies become more efficient and make more products to serve the economies that they are in, and we need a cooperative, collaborative relationship with the regulators, and that starts with education. It’s not a lobby, it’s not pushing our agenda forward, that’s not what I’m talking about: it first starts with a common understanding of the services we supply, and the products, and the impact on the economy we have.
Right now it’s very fragmented in Europe, so if there’s a way that we can consolidate that, and get an audience and explain, then I think we will be better off in the long run. Because more and more regulation is going to continue to come our way, and the foundation of that regulation is the banking industry.
Leasing Life: The 2008/9 financial crisis was also a big opportunity to take stock of the market and revise former practices. Have you seen any strategies that seem like a mistake?
I see people going back to pre-crisis go-to-market strategies, with a low rate, high risk strategy. That’s unfortunate, because there is so much liquidity in the marketplace right now, and there’s so much demand to deploy it. There’s a limited amount of transactions, so it’s natural if that’s the only goal of the lender to try to get the deal in any way possible, through the lowest price, and maybe the highest underwriting.
Leasing Life: You mentioned Tesla and Elon Musk as part of a unified commercial market approach to representing the industry. Can you explain where you see the similarities?
We lease Teslas, through our Athlon partners. Elon Musk released his patents, because he wants other companies to embrace the same approach and the same technology, because he knows the world will benefit. It’s not something that he’s trying to hold in. We at DLL are doing the same thing. We want to teach people how we approach life cycle asset management, how we are going to a fee-for-service model, how this economy is evolving, how we need to educate and bring people along with us. I think that we are the largest lessor in the world, and with that comes a fiduciary responsibility to help and assist and collaborate; not in trade secrets and pricing and issues that are not ethical. I’m talking about fundamentals of the business, the unification, and I’m a strong advocate of that.
We have a patent for a mobile app in the US. We’re the first to push e-signatures on documents, and to get that approved as an approved source. We’re moving towards paperless transactions that can be done on i-pads or i-phones up to certain dollar amounts. We’ve been in the forefront, and we want to share that and let everybody benefit from these technologies. We’ve done that in the States. It’s harder in Europe because every country has its own laws, and regulations: thus the reason that we must lobby together.
Leasing Life: You’ve mentioned in your speech at the Leasing Life conference that the sharing economy is upon us, but how do you think the curve will manifest itself with early adopters?
Well, we’re already in this market, through Athlon, through our mobility solutions business model. We have a mobility solutions model in its early stages, where during life cycles, and via incentives, we engage clients and do a complete mobility solution of their workforce. The difference between Europe and the US is they provide transportation. In the Netherlands, for example, it’s part of the compensation package. In America, you buy your own car, so it’s easy for us to provide, and we do a complete analysis on how to lower the carbon footprint, how to create more sharing, and it’s a pretty interesting model. It hasn’t yet taken off as people still like to drive, but it’s the same thing with I-phones, with everything. My kids are going to not want to own homes, they’re going to want to rent! People are going to pay for what they want, when they want it, and how do you advertise that when you have no fixed term, or you don’t have any commitment? It’s all part of the challenge.
Leasing Life: Are there other corporate sectors leasing can work with?
Employee benefits regarding mobility is a great business opportunity for leasing companies, especially car leasing companies, to go in and provide solutions for them and to save money. If you can get a third of the people in the long run that need a car but still have transportation options based on the ZipCars, that’s a benefit, and we’re doing that in the Netherlands right now.