Lease Plan, the largest provider of operational leasing of cars in Europe, has announced the acquisition of Dial Contracts. Lease Plan, a subsidiary of ABN AMRO, will assume full control of Dial, a subsidiary of Barclays.

The purchase, by Europe’s largest lessor, of the ninth largest lessor will significantly augment Lease Plan’s European coverage especially in the strategically important British and French markets. The new market shares that Lease Plan will hold are depicted in Fig 1. It is evident that Dial’s operations will significantly strengthen Lease Plan in Western Europe where they will assume market leadership in the UK and nearly 50% of the market in Spain.

…and the European market a little clearer…

The acquisition of Dial, coupled with the recent alliance of Arval and PHH, means that the identification of Europe’s leading operational lessors has become a little clearer. The mix of manufacturers, importers, banks, finance houses and dealership groups is slowly being distilled to those who have the means to compete in the international leasing market. The leading group of independent lessors is now limited to Deutsche Bank, ABN-Amro, BNP Paribas and GE Capital, with other organizations such as HSBC and Athlon Groep retaining the potential for promotion to this elite.

As the European banks dominate so much of the industry it is likely that any further consolidation in this upper tier will only occur with consolidation of the parent organizations. The merger of BNP and Paribas has already had significant ramifications for leasing in France, and the attempted union of Deutsche and Dresdner banks would have had a similar effect in Germany. If the banking industry undergoes the consolidation that has been muted, then the car leasing industry will be irrevocably altered.