Newspaper article The Journal (Newcastle, England)

Vehicle Hire Firm's Bid to Boost Growth in UK

Newspaper article The Journal (Newcastle, England)

Vehicle Hire Firm's Bid to Boost Growth in UK

Article excerpt


VEHICLE hire firm Northgate plc has introduced a series of measures to boost growth in its UK business, following a year that saw it lag behind the company's Spanish operation.

Results for the year ended April 30 show underlying profit in the firm's home market dropped from PS69m the previous year to PS58.2m. In Spain, by contrast, the figure rose year-on-year from PS33.3m to PS41.3m.

The Darlington firm said the lower level of demand in the UK - where the average number of vehicles on hire was 3% lower than the prior year, closing at 45,700, compared to 48,600 - was largely driven by customers linked to the "struggling" renewable energy sector.

A decision had also been taken to reduce the number of vehicles rented to non-business users in order to improve returns and focus on delivering strong customer service to core business customers. As it seeks further growth in the UK, Northgate has recruited a new senior management team, structured in a similar way to that of Spain.

A group executive committee has also been formed, including senior management from both territories.

The move is aimed at aligning objectives, creating clarity of focus and sharing best practices.

Northgate chief executive Bob Contreras said: "The new UK management team has been in place for six months and includes an MD, sales and marketing, and an operations director. We expect to see the full benefits of that in the second half of the financial year. Marketing, in particular, has always been a weaker spot for us, so it's great to be bringing in the expertise to make more people aware of the product we offer. We see that as being a strong part of the business going forward.

"In the medium term, we have got significant room for growing the UK business, while Spain has continued the path of strong growth. …

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