Supply chain disruptions, caused by the global and local events of the past two years, have resulted in a severe supply shortage of automotive parts. This is having a detrimental impact on South Africa’s car rental industry, and in turn, businesses’ productivity levels.
The impact of automotive shortages
Although these shortages are not a new issue and tend to crop up in a cyclical fashion, this shortage has, in fact, been among the most severe. In particular, the shortage of semiconductor chips, which are critical for the manufacturing of cars, is causing a major backlog in the automotive industry.
During the course of the past two years many companies, including car rental ones, have downscaled their fleets. Now they are faced with the issue of having too few vehicles to meet current demands and cannot scale their fleets at the necessary rate, because of supply shortages. This has caused there to be a scarcity of rental vehicles, which impacts businesses when they need to hire vehicles should theirs go in for repairs due to being damaged in an accident.
It is unclear when the shortage will be resolved, but what is clear is that companies need to adapt to mitigate these challenges. Here’s how:
- Ensure that car hire cover is included on your business’ fleet motor insurance policies and that the cover period selected is the maximum period available, in view of potential delays to vehicle repairs.
- If the company vehicle involved is still roadworthy and drivable following an incident, we recommend that you continue to drive it until the vehicle is booked in for the actual repairs. This means that the actual car hire period will only begin once repair parts have arrived, giving you and your business greater mileage on your policy.
- If in doubt, speak to your Indwe advisor regarding car rental products available to meet your organisation’s immediate and unique needs. We offer access to a range of solutions and partnerships, so you can find what’s just right for your business. (e.g. Smart Rental)
We’ve thought of every step you’ll need to take toward getting your fleet back on the road
Through our customisable car hire products, Indwe has several car hire solutions available to suit unique business needs or circumstances.
- If you or an employee find yourself unable to drive a company car following an accident, e-hailing services are an alternative solution to hiring a rental car.
- We’ve factored in car hire cover in the event of a SASRIA motor claim, which many policies exclude.
- Indwe allows you to extend your car hire up to 90 days if you are of the view that the sourcing of parts could cause delays.
- We also offer car hire solutions in the event of a mechanical or electrical breakdown of a vehicle.
- Rent the car you need. We ensure that you’re able to access a specific type of vehicle when required – for example, a bakkie with a canopy for a small business owner whose daily work depends on transporting equipment.
Let Indwe keep your business moving forward
Contact your Indwe advisor on 0860 13 13 14 or indwe@indwe.co.za for professional guidance on customised car hire cover that suits your organisation’s individual needs.
Indwe Risk Services (Pty) Ltd is an authorised FSP 3425.