The corporate director of Lex Autolease, Craig McNaughton, recently warned fleet operators that doing nothing in the face of taxation and legislation changes will only result in increased unhappiness from drivers and higher costs.
Speaking at the ACFO spring seminar he told delegates that the car fleet industry was facing change at a pace and on a scale that few others have experienced before.
What worried fleet operators more than anything else, he added, is all the unknowns surrounding the Worldwide Harmonised Light Vehicle Test Procedure or WLTP.
He added that it could take up to two years or more before choices became apparent. This has caused a significant number of buyers to delay their buying decisions and opt for extended leases to “try and buy themselves some time to work out what the impact of these changes is”.
Lex Autolease and its competitors are lobbying the British government to come forward with a sensible decision over company car tax when it implements WLTP-derived C02 emission rules from April 2020.
He added: “We think further (tax) increases through WLTP would be unfair on what is a highly taxed population already.”
McNaughton reminded delegates that the percentage used for BIK (benefit-in-kind) taxation has over the last ten years increased to 26% from 10%.
If they failed to successfully lobby Government and fleet operators opted to do nothing, more driver ‘noise’ will be forthcoming and costs will increase, he added.
He went on to say that it was vital for employers to begin reviewing their company car policies, and that even sceptics will have no choice but to start considering electric vehicles.
McNaughton continued: “Our view is that a restricted, single fuel-only policy will have to change and that some blended fuel solutions are needed. That will include looking at RDE2 diesel vehicles, when available, so you can take advantage of the drop in diesel BIK of up to 4%.”
Plug-in hybrids, he added, will stay a part of it, provided there was an appropriate, level-headed fuel policy to counteract some of the possible cost increases. Fully-electric vehicles will also have their place, provided their suitability for the job has been studied properly.
He advised businesses to also look at solutions to shore up grey fleet management, since they often involved older cars that had a higher chance of being affected by the launch of clean air zones in cities.
Telematics, he continued, can play in important role in understanding what the possible effect of CAZs will be and data is going to be crucial to employers who want to create travel strategies.
McNaughton advised enterprises to let their suppliers help them wade through the ‘minefield of regulation’ and to plan for, adapt to and accommodate coming changes.
Fleet suppliers can also assist fleet operators to measure themselves against industry leaders and to find novel ways to bring down fleet costs (including the cost of fleet insurance).
He concluded by saying: “We see benchmarking as allowing customers to be competitive both from an operational and from a reward perspective. Retaining and recruiting the best staff through attracting a competitive rewards strategy is essential in these challenging times especially as we move into the post-Brexit arena.”Previous Post Next Post