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  4. What is happening in company cars 2015: Part 1 – Practice

What is happening in company cars 2015: Part 1 – Practice

This two-part report examines latest company car surveys, together with two case studies, to provide a picture of current policy and practice in company car management. The first part of our study was researched and written using the latest company car surveys from several leading specialists, including Towers Watson, Mercer, Alan Jones & Associates and Lex Autolease. Key trends in fleet management include: reducing CO2 emissions, the rise in use of telematics, a growing emphasis on driver training and a surge in number of 'grey fleet' drivers.

CONTENTS (28 pages)

Researched and written by E-reward.co.uk

EXECUTIVE SUMMARY
  • The E-reward.co.uk research
  • Key findings
SECTION 1: OVERVIEW AND KEY TRENDS
  • Reducing CO2 emissions
  • The rise of telematics
  • An emphasis on driver training
  • A surge in the size of the “grey fleet”
  • A review of company car policy and practice
  • The company car surveys
  • Box 1.1: Details of the surveys used in this report
SECTION 2: VEHICLE ACQUISITION
  • Contract hire
  • Contract purchase
  • Finance lease
  • Outright purchase
  • Helping employees to acquire their own cars
  • Providing a cash allowance only
  • Employee car ownership schemes
  • Choice of vehicles
  • Looking at cost: whole-life versus list price
  • Environmental considerations
  • Restrictions on employee-owned cars
  • Capital allowance rules for 2015 and beyond
  • Box 2.1: Most common company car financing methods
  • Box 2.2: Level of company car choice given to drivers
  • Box 2.3: Types of company car prohibited
SECTION 3: FLEET MANAGEMENT
  • In-house or outsourced?
  • Replacement cycles
  • Car disposal
  • Box 3.1: Employers outsourcing various aspects of fleet management (%)
SECTION 4: DRIVER ELIGIBILITY AND VEHICLE ALLOCATION
  • Job need drivers
  • Status drivers
  • Types and values of vehicles
  • Equipment provided as standard
  • The impact of promotions and other changes
  • Promotions and transfers
  • Leavers
  • Absentees
  • New joiners
  • Part-time employees
  • Paying for private use of a company car
  • Box 4.1: Typical purchase prices and annual lease costs of company cars at different job levels
  • Box 4.2: Typical make and model of company cars provided at different job levels
SECTION 5: SCHEME FLEXIBILITY
  • Cash allowance as an option
  • Calculating the cash allowance
  • Take up of cash allowances
  • Switching between cash and car
  • Maintaining control over employees’ own cars
  • Trading up and down
  • Box 5.1: Annual median car allowance amounts by job level
  • Box 5.2: Limits on switching from cash allowance to company car and vice versa
SECTION 6: INSURANCE, FUEL AND OTHER COSTS
  • Insurance
  • Fuel
  • Paying for fuel
  • Fuel allowances – for business journeys in company cars
  • Mileage allowances – for business journeys in private cars
  • Private fuel benefit charge – for private journeys in company or private cars
  • Other costs
SECTION 7: WIDER COMPANY CAR AND BUSINESS TRANSPORT INITIATIVES
  • Using telematics to monitor fleets
  • Improving driver behaviour through training
  • Improving driver behaviour through financial incentives and disincentives
  • Green transport policies
  • Box 7.1: Green transport initiatives used by employers

APPENDIX A: TAX ON COMPANY CARS
APPENDIX B: VAT ON FUEL
APPENDIX C: FUEL AND MILEAGE ALLOWANCES
APPENDIX D: THE COST OF RUNNING CARS
APPENDIX E: GLOSSARY

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