Ayvens raises 2029 return on tangible equity target to 14%-16%

Car leasing firm Ayvens has revised its 2029 return on tangible equity target upward to 14%-16%, up from the previously projected 13%-15% under its PowerUP 2026 plan. The improved projection is largely driven by expectations of a 4 percentage point reduction in the cost-to-income ratio, now estimated at about 49% in 2029, down from around 53% in 2026.

Productivity enhancements, such as the adoption of AI technology, are anticipated to boost efficiency by 6 percentage points, while growth and upselling efforts are projected to add 3 points. On the downside, inflation and the shift towards electric vehicles are expected to erode performance by 5 points.

In terms of capital adequacy, Ayvens aims to raise its common equity tier 1 ratio to approximately 12.5%, up from 12% in the earlier plan. The dividend payout ratio will remain in the range of 50%-60%, with any excess capital returns yet to be determined. The company projects a 3% annual increase in its funded fleet between 2026 and 2029, resulting in a 10% growth in earning assets from December 2026 to December 2029.

Ayvens anticipates a 15% increase in its retail fleet, expanding to over 900,000 vehicles from the current 780,000, and a 10% rise in its light commercial vehicle fleet, reaching more than 580,000 from the present 530,000.

The company expects the operating lease market to expand at an annual rate of 0.4% based on insights from both McKinsey and Ayvens. ACEA data indicates a decline in passenger-car registrations, falling to 12.5 million in 2030, down from 13.3 million in 2025. Concerning maintenance margins, Ayvens expects lower margins for battery electric vehicles compared to other powertrain types.

AI automation is projected to deliver efficiency gains of 30% across eight key processes. To offset rising costs, the firm plans to decrease net spending on repair, maintenance, and tyres by around 2%, from €2.6 billion in 2025, through strategic sourcing and internal cost controls. It targets a 56% penetration rate for insurance and damage cover by 2029, up from 53% in 2026.

Additionally, Ayvens plans to introduce its Ayvens Power EV charging service to 15 countries by 2029, a significant expansion from its current operations in just two nations. The company projects leased-fleet CO2 emissions to decrease to 75-85 grams per kilometre by 2029, down from 101 grams in 2025. For the 2027-2029 period, Ayvens anticipates annual net retail deposit collection ranging between €1 billion and €2 billion, securitisation issuance between €1 billion and €2 billion, and bond issuance between €2 billion and €3 billion.