Industry Insights
The Europe fuel card market size was estimated at USD 60.72 billion in 2016 and is expected to witness significant growth owing to the rise in demand of digital transactions, availability of additional benefits and prevention of theft. Moreover, the savings on fuel spending is luring fleet managers towards adopting cards.
Germany fuel card market revenue, by conveyance, 2014 - 2024 (USD Billion)
Fuel card operators not only give discount on prices but also provide fleet managers with numerous add on services such as fleet servicing, toll payments, real time access to data, and monthly GST invoice. This availability of value added services is expected to drive the market in the future.
Owing to the sophistication in fuel theft, the managers are inclined towards cards that can automate the process. European goverments estimated theft of billion of euros every year. As a result there is a rising demand for effective management system. Hence, the market is expected to grow as it provides secured fuel purchase, detection and prevention by real time access through online fleet management softwares.
Furthermore, live updates across the country help fleet managers and drivers to identify the outlets that offer the best deals. Most drivers earn points offered by service providers through loyalty program.
The small and medium enterprise are increasing in the UK and Germany which is expected to facilitate growth of the market. Hence, foreign direct investment (FDI) are taking place so as to extend the presence of foreign companies in Europe. For instance, in September 2014, Fleetcor completed the acquisition of Shell SME portfolio related to fuel card business in Europe.
Increasing sophistication in the fraudulent activities can act as a hurdle in its growth. These cards are vulnerable and can be stolen or duplicated. The secure pin used to make a purchase can be also hacked. Furthermore, the odometer reading while fueling should be correctly noted. Thus, rising number of frauds can act as a major restrain to the market.
Furthermore, the political and economic uncertainty prevails in Europe owing to the UK’s withdrawal from ‘Brexit’. This exit is expected to impact the consumer investor relation, free movement of goods and level of consumer purchase of fuel cards. Thus, it can also prompt other European countries to approve similar referendums and can act a potential hurdle in the growth of the market.
Segmentation By Card Type
• Universal
• Branded/Proprietary
• Merchant/Bank
The universal card held the major share and was estimated for 41.9% in 2016. It is the fastest growing segment owing to the various advantages provided to the customers. For instance, universal cards provide with numerous benefits such as level three data, coverage benefits and online reporting tools.
The branded/proprietary card are issued by a particular company such as BP and/or Shell have a mature market share in Europe. These giant brand cards have a strong hold in Europe’s fuel card industry and give tough competition to third party cards, although, debit & credit cards are also used.
Moreover, the merchants also enter into partnership with the gasoline companies to provide their customer corporate cards with added benefits. For instance, in 2014 Shell introduced contactless and mobile payments with Visa at all shell stations in Germany.
Segmentation By Conveyance
• Light weight
• Heavy weight
The light weight fleet accounted for the largest market share of 81.5% in 2016 owing to the large number of passanger vehicles use in Europe. The commercial road transportation vehicles are increasingly inclining towards universal fleet cards so as to prevent theft and obtain benefits across regions.
The heavy vehicles segment is expected to rise owing to the increase in small scale and medium scale enterprises. The market growt in the light weight vehicles is expected to remain steady during the forecast period.
Segmentation By Country
• Germany
• UK
• Italy
• France
• Spain
UK was the largest and is expected to witness the fastest growth owing to the increasing number of commercial vehicles. In addition, the increaseing number of small and medium scale enterprises is expected to further drive the market over the forecast period. Germany held the second largest market share and accountd for 26.3% in 2016.
Italy and France is expected to grow slightly owing to the growth in the automotive industry. For instance, Italy is home to several of the top automobile manufacturers due to which the country is expected to witness a boom owing to the increase in the sales and help boost the growth of the market.
Competitive Landscape
The major players in the market include BP, Shell, Fleetcor and Wight Express. The European market is competitive in nature.
The major players are adopting the strategy of merger and acquisition so as to expand their presence in the market. For instance, in 2014 WEX acquired Exxonmobile’s European commercial card business. Other key players include DKV EURO SERVICE GmbH + Co. KG, UK Fuels Limited, W.A.G. Payment Solutions, ExxonMobil Corporation, Aral, and Total.
