COMPANY CARS
North-south divide in Europe for company cars
Northern European employers are far more likely to offer a cash alternative to a company car, while in southern Europe the provision of a company car without a cash alternative is the norm, according to research by consulting firm Watson Wyatt.
The survey found that UK employers are ahead of the rest of Europe for allowing employees to take cash as an alternative to a company car:
This contrasts with Belgium, Greece, Italy and Portugal where over 70% of employers have a policy of providing company cars only. Most employers in EU accession countries do not to offer alternatives to a company car. Providing a cash allowance without the option of a company car is very rare outside of the UK, Ireland and Scandinavia.
As Anne G Severeyns, a senior consultant at Watson Wyatt, explains: "In recent years, when companies looked at reviewing their vehicle policies as part of their aim to reduce costs, car/cash alternatives were highly considered. Employees have opted for cash in countries where the legal framework clearly offers tax efficiencies for such choice. The UK is definitely the most advanced in that direction."
Company cars: Top 10 in western Europe operating a cash allowance or alternative policy *
| Operate a cash allowance or car/cash alternative | |
| United Kingdom | 63% |
| Norway | 60% |
| Finland | 53% |
| Ireland | 50% |
| Sweden | 46% |
| Denmark | 36% |
| Switzerland | 34% |
| Germany | 25% |
| Netherlands | 25% |
| Austria | 18% |
* Where car, cash alternative to a car or motoring expenses are reimbursed.
Source: Watson Wyatt.
Want to know more?
Title: Company Car Report 2004/5, Watson Wyatt.
Availability: This biennial European-wide survey of company car policy includes extensive information and data on company car policy and practice across 34 countries (all 17 Western countries and 15 Eastern countries, including the EU accession countries, Turkey and Israel). The report is available in single country and pan-European formats from Watson Wyatt Data Services, email: customerservice@eu.watsonwyatt.com
Watson Wyatt is a global consulting firm "focusing on human capital and financial management". It specialises in employee benefits, human capital strategies, and insurance and financial services. Watson Wyatt has more than 6,000 associates in 88 offices around the world. To find out more visit www.watsonwyatt.com
Posted 1 June 2004