The service “Fleet management” includes vehicle financing (standard through operating lease), their maintenance and insurance. Today, it is offered by most major leasing companies (as an extension of their operating lease offerings), by specialized companies which focus solely on the service itself, and companies with a rent-a-car core business, who thus lengthen the rental period for their vehicles. The abundance of fleet management offers can be found in any developed market. However, this was not always the case. The history of leasing remembers the man who created the service.
Here is how it all began:
In 1936, young Zolman (Zollie) FrankZollie Frank is one of three... More, who at the time was “on his way to seek his fortune in California,” stopped in Chicago to buy Chrysler car. After a chance conversation with the car maker’s representative, Zollie bought an entire car dealerSee Supplier... More business (for Chrysler and Plymouth cars). Of the USD 7,500 capital he started with, Zollie used USD 2,500 for the deal and retained USD 5,000 for working capital. The address is 6116 N. Western Ave. – still unknown, but which will soon become the “world’s largest car dealerSee Supplier... More.”
In 1939 he founded the company Four Wheels Inc., which was later renamed Wheels Inc. While looking for a way to grow the business, Zollie discovers that fleet leasing and management service provides just such an opportunity.
The first fleet management deal was with the pharmaceutical company Petrolager Laboratories for leasing 5 full-service vehicles for 12 months with a closed-end and included insurance. Both parties quickly understood the benefits of the new service. The following year, Petrolager contracted 75 vehicles for their whole sales team.
What Zollie was doing is not radically new. Car rental was already a popular service, leasing was becoming common for a variety of assets, large companies already had their own car-fleets, large car dealers provide warranty maintenance and service. In Zollie’s words, “what we did was take some existing ideas and pack them in a whole new way.” Zollie offers, for the first time, a long-term (then 12-month) lease for a car or fleet with maintenance and insurance included. In modern terms – a 12-month full-service operating lease, or fleet management.
In addition to creating the new service, Zollie is also concerned with its promotion. It was necessary to make clients understand the benefits of leasing and outsourcing their fleet management. The catchphrase he used is “Z Frank before you buy” to allow Zollie to explain the benefits of using the fleet management service to his potential customers.
“Customers no longer had to worry about buying, reselling or maintaining their cars or the costs involved. What they were required to do was put gas in the car and pay a monthly fee of $ 45. ”
Zollie Frank
In 1948 Wheels set up a national system in the United States, together with tire sales companies, to provide tire replacement near their customers. This initiative will soon grow into the creation of a nation-wide car maintenance network for customers using the fleet management service.
In the 1950s, Zollie Frank responded to changing market demands and created the new TRAC Leasing service – Terminal Rent Adjustment Clause Leasing, or, as it is popular today, open-ended financial leasingA leasing contract, under which, the... More.
In 1953, Wheels switched to General Motors and bought the smallest Chevrolet dealerSee Supplier... More in Chicago. By 1970, it had become the largest General Motors dealerSee Supplier... More in the world.
In 1958 Wheels becomes the first company to offer the leasing of trucks.
Today, Wheels is the largest fleet management company in the United States with a fleet of more than 300,000 vehicles. In 2009, Wheels joined forces with European giant ALD Automotive, expanding its network worldwide to 56 countries and a fleet of more than 2 million vehicles.
Zollie Frank is considered one of the fathers of modern car leasing. Leasing helped him build an empire, and he, in turn, developed the leasing services and created what we today popular as “fleet management.”
Read more of the History of Leasing.
