Our purpose is to provide our customers access to affordable, worry‑free mobility.
Motability Operations was established in 1978 to deliver the Motability Scheme, under contract to Motability the national charity (which is responsible for oversight of the Scheme).
We provide mobility to almost 649,000 customers with a wide range of different disabilities, providing an opportunity to achieve freedom and independence.
As we do not pay shareholder dividends we can focus purely on delivering for our customers, with profits available for reinvestment to support their current and future needs. In addition, we may also donate to Motability (the Charity) supporting their broader aim to enhance the lives of disabled people with transportation solutions.
Highlights 2021
649k
Customers on the Scheme
94%
Employee engagement
(measured during lockdown)
>30,000
Jobs linked to the Scheme
98%
Worry-free motoring satisfaction rating
8.45%
Talent retention is high with
regretted attrition just above 8%
£3.1bn
Purchases from UK dealers
Leadership statements
Investing to meet the needs of the future
Supporting customers now and in the future
A unique proposition
Our objectives underpin the core Scheme proposition, ensuring that through our people and our partners, we meet the needs of today’s and tomorrow’s customers.
How we add value
Our customers
- We aim to deliver value and an excellent service for customers by providing an affordable, consistent, worry-free leasing proposition which is universally available across the UK.
- Our proposition is delivered in a sustainable manner to ensure that we meet the needs of today’s and tomorrow’s customers.
Our people
- The way we work is central to delivering and meeting the needs of our customers.
- Our employees believe passionately in what we do, underpinned by a strong and supportive culture.
- We aim to recruit and retain the talent needed to maintain our strong performance over the long term.
Our partners
- Working with our key partners we provide a worry-free mobility offering: servicing, breakdown assistance, insurance, tyre and windscreen replacement.
- We have developed strategic relationships with mainstream car manufacturers and support specialist training across the UK dealership network.
Investing for today and a sustainable future
Supporting customers through the pandemic
Investing in the Glide Path to Green
Affordability support
Support for Motability
How we deliver the Scheme
We provide mobility to nearly 649,000 customers who receive the Government’s mobility allowance. Through integration of manufacturers, dealers and other suppliers, we provide customers with worry-free, affordable mobility to meet their individual needs.
Investing in the electric vehicle transition
The transition of our customers to electric vehicles over the next few years requires careful planning and support; we are focused on ensuring that our customers are not left behind on this transition. We aim to ensure that customers have access to suitable, affordable vehicles, with the availability of cost-effective and accessible charging options.
Progress to date
Accelerating the transition
Our future ambitions
Our strategic framework
Select a strategy pillar to find out more
Our values help us deliver our strategy
Our strategy
In order to ensure that our activity delivers outstanding value to customers, we have defined four strategic ‘pillars’. These set out a clear framework within which we align our business objectives, strategic initiatives, performance targets and business planning. Our people, positioning principles, culture and values form the bedrock to deliver these objectives.
Our values
Our values are central to delivering and meeting the needs and expectations of our customers. We embrace diversity, which enables us to have a wide variety of approaches and perspectives, enhancing performance and creating value for customers.
Investing in the electric vehicle transition
Progress to date
This year we have invested over £20m to subsidise the pricing of electric vehicles on the Scheme, including the installation of free-of-charge home charge points where this is viable.
We recognise that electric vehicles are not currently suitable for a proportion of our customers (often due to vehicle suitability, mileage-range anxiety or access to charge points).
Therefore we now undertake a full suitability assessment prior to application to ensure that customers are making an informed decision and that selecting an electric vehicle is the right choice for them (including access to vehicle charging, and understanding their expected mileage/usage in the context of battery ranges).
We also remain focussed on ensuring that we continue to provide a worry-free proposition for those customers who are not yet ready to make the transition to an electric vehicle.
>10%
of applications for EVs in October 2021
Applications split by fuel type
Alternative Fuel Vehicle Applications (%)
This investment and triaging of customers has supported an acceleration of applications into electric and hybrid-electric vehicles, with total alternative fuel vehicle applications increasing from 10.7% in the final quarter of 2020 to 26.5% in October 2021, with pure electric vehicle applications increasing from 1.7% to 10.2% in the same period.
There are currently 87 battery electric vehicles available on the price list, with 21 requiring no “advance payment” from customers (affordable through the assignment of the customer’s allowance alone, with no additional cost).
Without the current investment into lease pricing (subsidy), the current breadth of offering would be significantly reduced.
Making electric vehicles available to all
Investing in the electric vehicle transition
Accelerating the transition
Further to the significant investment already made to support an increasing uptake of electric vehicles over the last year, the Board has committed an additional £300m of capital investment over the next five years. This has been ring-fenced to invest in support of the affordability of the Scheme’s electric vehicle offering and for the continued provision of free-of-charge home charging points, with a hassle-free installation process.
This coincides with the launch of a number of exciting new EV model ranges from Original Equipment Manufacturers (OEM), including a number of larger vehicles in the “cross-over” segment which represent heartland vehicles for Scheme customers given their accessible characteristics. With battery ranges and charging infrastructure also improving, this means that an electric vehicle is becoming a viable option for an increasing proportion of Scheme customers.
Motability has partnered with the UK Government to set accessibility standards for electric vehicle charge points, with British Standards Institute (BSI) to develop accessibility standards for EV charge points across the country. This important development will help ensure that customers who choose an electric vehicle can be confident that charge points will be accessible to them.
We are enhancing the way in which we assess and triage customers who are contemplating the transition to an electric vehicle, ensuring that customers’ needs are fully understood and that an electric vehicle is the right choice for them.
Recognising our responsibility around climate change we have also initiated a project to independently verify our carbon footprint and are engaging with the Carbon Disclosure Project’s disclosure exercise, and as a next step we are committed to set transparent and measurable targets for CO2 reduction, with our customer vehicle fleet and the electric vehicle transition being core to this strategy.
Commitment to invest additional capital
Investing in the electric vehicle transition
Our future ambitions
We are committed to the Glide Path to Green and plan to set out a clear route map for carbon reduction and the route to net zero.
As part of our wider ESG strategy we will define specific targets in terms of electric vehicle adoption and CO2 reduction. This strategy is broader than simply focussing on our customer car fleet and extends into minimising the environmental impact of premises footprint and our people. More detail is outlined in the ESG pages of the full annual report.
We are also actively exploring how vehicle charging solutions can be optimised for our customers. This includes understanding the role we can play in ensuring customers are able to benefit from developments within the charging landscape such as smart charging hardware and software options and specific EV charging tariffs.
It is also clear that the transition to electric vehicles may disrupt the traditional OEM supply model, with a number of OEMs already focussing on direct to customer online routes for their electric offering. We will work closely with the OEMs and ensure that the Scheme offering remains sufficiently agile to adapt to these shifting routes to market.
Our overarching ambition is to accelerate the adoption of electric vehicles on the Scheme whilst balancing this with customers’ disability-related needs, so that this transition does not lag behind the wider market, thereby ensuring that disabled customers are not left behind on this transition.
Ensuring a ”Glide Path to Green” for our customers
Building our customer and disability expertise
Objectives
Deliver best-practice customer service through our call centre
Ensure that the standard of services deployed through our key suppliers is commensurate with our internal targets
Build our adaptation and conversion expertise to ensure that customers have a seamless experience and that we are recognised for the excellence of our ‘one-stop shop’ service
Provide our customers with the information and tools they need to select a suitable car from the wide range available
Provide information to support decision-making to meet customers’ mobility needs
Delivery
We continue to invest in our front-line customer services team to address more complex customer needs that have arisen through the pandemic, and to manage the external supply side challenges which undoubtably impacts many customers moving into a new lease.
Throughout the national lockdowns, we kept our call centres open, allowing customers to reach us when they needed to. While this presented many challenges, the engagement and values of our call centre staff allowed us to continue providing high levels of service to our customers.
Speech analytics enhances our immediate understanding of customer needs and allows us to adapt our delivery, and remain agile to any changing requirements.
We continue to develop our customer digital services, providing customers with options on how they want to interact with us, as well as enabling customers with the ability to manage their account online, and receive payments via BACS if they so choose.
Expanded the digital offering to provide customers with access to information at any time of the day. This has been supported by extended hours of service, trialling of other channels of interaction e.g. Webchat, Twitter, WhatsApp chat. Our online channel has proven particularly popular with customers who are unable, or prefer not, to use the telephone.
Our Edinburgh office is now fully operational, a facility designed with disabled customers, disability organisations and colleagues in mind, enabling us to access more tools and additional resource to support our people and customers but also the wider disability community.
The Continuous mobility programme has ensured that our customers can continue with their day-to-day lives; this has been vital given Covid-related repair backlogs and car supply shortages, leading to higher levels of customers’ vehicles being off the road for a period of time.
Worked closely with the converters of our most complex vehicle solutions, understanding and supporting the challenges faced during a difficult period for these often more bespoke organisations.
Our ‘try before you buy’ service has been invaluable for customers who may require a WAV. Customers are able to choose vehicles that are right for their needs, making informed decisions on the suitability of more complex vehicles.
Key performance indicators
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98%Target of >92%
Overall customer satisfaction
We deliver by listening to our customers and ensuring that we meet their requirements.
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58%Target of 80%
Calls answered within 20 seconds
Throughout the year call volumes have been higher than expectation, driven by Covid-related concerns and enquiries about the availability of new vehicles. Whilst the 80% target has not been met, on average we were able to answer calls within three minutes.
-
39.1
minsTarget of <42mins
Roadside assistance average Response time
Mobility is a priority to our customers. In the event of a breakdown our customers receive priority assistance, and with an average response time of 39.1 minutes during the year (compared with a KPI target of <42 minutes), customers are quickly attended to and are mobile again.
Provide value and choice
Objectives
Provide stability in pricing and choice throughout the economic cycle
Maintain a range of at least 200 cars at ‘nil advance payment’
Provide a wide selection of vehicle models and brands
Ensure that our residual value-setting and forecasting is the best in the industry
Retain our market leadership for vehicle remarketing
Delivery
Working alongside car manufacturers to maintain choice and affordability for customers with more than 205 cars available at no more than the allowance. This was achieved despite disruptions caused by Covid and supply issues caused by the global chip shortage.
Provided a large selection of vehicles available at less than the customer’s full allowance, with on average 91 cars available through the year.
We have recognised the increasing profile of electric as a vehicle choice, and been able to offer customers an average of 86 electric vehicles options during the year. We have also sought to assist customers with electric charging options, including a home charger as part of the lease package for any battery electric vehicle chosen by customers.
Continued to develop our processes of residual value forecasting, to ensure customer pricing is based on a fair and reasonable assessment of future market values. An independent third-party end-to-end assessment of our residual value forecasting stated “MO’s forecasting approach uses sophisticated techniques, is robust, fit-for-purpose and aligns to forecasting best practice”.
Further enhanced the customer WAV proposition with the roll out of familiarisation visits, and annual checks, to make sure customers are comfortable with their vehicle, and the technical aspects remain sound.
Continued activity on the long-term development of systems infrastructure for our online remarketing processes. The agile development will deliver a sustainable and secure platform for the future and provide opportunities to deliver enhancements to our existing remarketing capabilities.
Despite disruption in the market from national lockdowns and emerging competitors, VRM channel has performed strongly. We continue to invest in technology to ensure the proposition is robust to deal with new emerging channels of competition.
Key performance indicators
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43%Relative affordability – % cheaper than alternative
We benchmark ourselves using commercial contract hire quotations. These are usually unavailable to the general public and are likely to be less expensive than personal contract purchase quotations. Our economies of scale, operational efficiencies and a VAT concession (which is passed onto customers in lease pricing) deliver the majority of this differential.
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72%Target of 70%
% of vehicles sold online at the end of lease
Selling via our online sales channel, ‘mfldirect’, provides an effective, low-cost route to market which facilitates the management of our high volume of disposals, and also ensures a competitive sales environment through which we seek to maximise our net return. During the year to September 2021, 72% of vehicles were sold online.
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205Target of >200
Affordable vehicle choice at ‘nil advance payment’
We aim to maintain the availability of at least 200 cars that are funded solely by the assignment of the customer’s disability allowance. Whilst this target was met during the year, new vehicle supply challenges and manufacturer model range rationalisations has reduced the breadth of offering. We anticipate this pressure to intensify during 2022.
Improve reach and awareness
Objectives
Raise understanding of Scheme elements and confidence and trust in the Scheme
Maximise effectiveness of multimedia channels to increase understanding within the eligible customer base
Identify and, where appropriate, remove any barriers for potential customers
Continue to encourage Motability dealers to promote the Scheme in line with our brand
Delivery
Due to Covid-19 and uncertainty around large events, we were once again unable to physically host our ’One Big Day’ event this year. The event was once again held online with 10,225 people registered. 72% of attendees that completed our post-event survey said they would attend another online event hosted by the Motability Scheme.
Provided operational and disability confidence training for several thousand dealer Motability specialists, all through an online platform which was developed rapidly to replace our usual classroom environment. Our training courses are being adapted to further enhance our services and align them to a multi-channel approach.
Continued improvements to the Scheme website, offering users a simpler, cleaner journey in line with our updated branding and redesigning the way key information is ordered and displayed.
Developing an online ’self-service’ portal, further broadening the opportunities for customers to contact us and to tailor their package to their own specific requirements.
Continued to work with Family Fund, the UK’s largest charity providing grants for low-income families raising disabled or seriously ill children and young people, to deliver a pilot scheme providing vehicles to families with children under the age of three who are seriously ill or disabled but do not yet qualify for a government mobility allowance. This programme was endorsed by the DWP with funding to date provided by Motability (the Charity), and during the year more than 200 families were supported by the provision of an appropriate vehicle.
In July, we announced that Direct Group Limited will take over from RSA as our insurance partner. This new proposition will offer the potential to grow the Scheme and offer increased flexibility to customers. We are confident that the new relationship will support worry-free motoring and value for money to our customers.
Key performance indicators
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97%Target of >85%
Trust in Motability
Since 2012 we have measured customers’ trust in the Motability brand. Trust is considered to be key in enabling current and potential customers to make an informed and confident choice of a mobility solution that meets their disability needs and, in turn, strengthens customer advocacy of the Scheme.
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91%Target of >85%
Customer renewal rate at the end of lease
Whether customers decide to renew at the end of the lease is a key measure of our success in delivering affordability, choice and customer service. During the year to September 2021 this was maintained at 91%, compared with a KPI target of 85%.
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98%Target of >85%
Customer advocacy
Existing customers are the Scheme’s biggest advocates, with 98% saying that they would recommend the Scheme to others.
Ensure long-term sustainability
Objectives
Maintain a prudent reserves policy that provides financial strength adequate for us to withstand the impact of potential shock events
Create opportunities to access wider sources of competitive funding. We aim to maintain our credit rating, enabling us to secure the most appropriate funding at competitive rates
Ensure that our premises and information technology infrastructure are robust and future-proof
Attract and retain quality people
Continue to nurture effective partnerships with key stakeholders
Maintain a forward-looking environmental policy, providing a choice of environmentally friendly vehicles on the Scheme, balancing customer needs with fuel economy and emissions
Delivery
Financial results during the year have been buoyed by a significant increase in used-car values, caused by demand from new online dealers and supply shortages related to the semi-conductor crisis in the new car market.
We continue to apply capital modelling methodology and our applied risk appetite and confidence levels, and we benchmark our capital reserve levels against near-comparable companies. This Economic Capital approach has been confirmed as appropriate by Oliver Wyman and supports the Group’s application of a 99.99% confidence level.
Continued development aligned to our strategic IT roadmap that will secure systems sustainability (replacing aged legacy systems) with linked benefits flowing across business operations.
Our annual independent employee culture survey recorded an exceptionally high engagement score of 94%, significantly ahead of the benchmark of other high-performing organisations.
Given the high-performance levels expected of individuals who work to deliver the Scheme we have invested resources to ensure we maintain and develop an appropriate environment that supports their needs and that recognises and embraces the benefits of a diverse workforce.
Maintained a proactive engagement programme with key stakeholders, operating in a transparent and straightforward manner.
Invested £20m to improve the affordability of electric vehicles, with £300m ringfenced to invest over the next five years.
Key performance indicators
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94%Target of 84%
Employee engagement
We participate in an independent annual review of business culture, where we have significantly outperformed the ‘High-Performing Organisations’ benchmark. Employee engagement is 10pts higher than the benchmark.
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A/A1
Credit rating
Our credit ratings underpin our ability to fund the Scheme in a sustainable and cost-effective manner. Our ratings are A / A1 with stable outlooks (from Standard & Poor’s and Moody’s respectively).
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7.9yrsDebt maturity profile
The Group aims to retain a well-laddered debt maturity profile in order to effectively manage refinancing risk. The average debt maturity remains appropriate at close to 8 years.