D’Ieteren injects another million in ‘promising’ used-car leasing
D’Ieteren, Belgium’s major car importer, pumps another million (€) in it’s Lizy daughter, focusing on a ‘promising market’ of second-hand car leasing. After one year, Lizy signed up some 300 clients, mostly SMEs, with two to 40 employees and self-employed people. And it’s going fast, with a 25% growth per month.
According to Frank Van Gool, CEO of the Belgian federation of leasing and renting companies Renta, ‘in theory’, the leasing of second-hand cars is done by all leasing companies, but only on a very modest scale today. He believes the leasing of used vehicles has considerable potential in the future when electric cars with a high residual value will come on to that market.
So, why is leasing a second-hand car a good idea? “Because new cars depreciate rapidly at the beginning of their lifecycle; leasing a second-hand car can be attractive with 15 to 40% lower prices,” Lizy’s CEO, Sam Heymans, tells the newspaper L’Echo.
Starting at €232
Typical ‘deals of the week’ are, for instance, a Golf VII with 9 000 km on the odometer starting at €258 per month (36 months term, 10 000 km a year), a 2018 Audi A3 Sportback with 26 000 km for €370, but also a 2019 zero-km Fiat 500 for €232.
It’s not limited to D’Ieteren’s Volkswagen Group portfolio. Also, popular leasing cars like Mercedes C-Class or BMW 3-series are offered. Then we’re talking about prices from €584 to €892.
SME and self-employed
The SME and self-employed ‘niche’ was targeted by young entrepreneurs Sam Heymans and Vincent Castus from the start of Lizy, as a part of D’Ieteren’s incubator LabBox. They still believe this market is more or less ‘neglected’ by the big leasing companies, while small companies don’t have the ‘negotiating power’ of large corporations.
“Quite a lot of our clients are working in the digital sector or are coming from start-ups,” Heymans says. Lizy capitalizes on these young people’s interests by offering the possibility of concluding the contract with a few clicks online and having the car delivered at the office within two weeks, for instance.
Lizy also offers short lease contracts starting at three months to six months. Models offered for this are Skoda Citigo (€269), Skoda Octavia (€529), or VW Tiguan (€639). Leasing terms of 48 months aren’t always suited for today’s reality anymore; the company is betting on.
Clients targeted can be fleet managers waiting for a specific leased car to be delivered or freelancers needing transportation for a particular project, for instance. But shorter leasing terms can be a solution for people hesitating to decide what kind of drivetrain they will choose: electric, gasoline, diesel, CNG? Or to try out one or another. 10% of demand at Lizy’s is already for electric cars.
Private lease market?
Although not offered yet, Lizy is thinking of expanding its business to the private lease market or crossing the Belgian borders. The example of the Netherlands with private lease going from 10 000 cars in 2013 to 200 000 in the year to come, makes Heymans daydream.
The extra million D’Ieteren is pumping into Lizy today is meant to finance the expansion of the fast-growing company. The only thing slowing down the company, so far, was that Lizy didn’t always have enough cars to offer on its website at all times.
Convincing larger players
Lizy isn’t a fully-fletched leasing company and doesn’t own the cars it offers. It is rather an intermediate for D’Ieteren’s leasing branch, but also for third-party leasing companies of middle and small size. The idea is to convince the more significant players too, to make use of Lizy’s intermediating services.
As a start-up, Lizy isn’t making money, so far. Profitability isn’t a goal in the short time, Sam Heymans says, the objective is to become profitable next year or by 2022. “The extra million is to continue growing, reinforce staff (10 people today), and invest in marketing to get the brand known,” Heymans explains to a journalist of La Libre.