Are you ready?
Economic, environmental and political pressures, and the rapid development of technology, are impacting every type of fleet in 2019.
That’s why our Head of Consultancy, Claire Evans, has joined up with Jinmi Macaulay, Senior Policy Advisor at BVRLA to host a webinar, where you’ll receive in-depth insights into external factors affecting fleet and actionable tips for how to gear up for the future.
You asked, our consultancy ‘Bright Sparks’ answered:
What can my business do to help support the campaigns on tax changes and clean air?
The Government is undertaking a robust consultation and is very interested in the impacts of proposed changes on business. It wants to hear from individual companies, and we are working with customers to bring to life the issues they face and raise them collectively.
You can also engage with the MP in the constituency your business is registered in to ask them for their support. The BVRLA website features a section with information on how you can support our messaging on WLTP and Clean Air Zones and submit a case study detailing how CAZs will impact the day-to-day costs and administration of your business.
The BVRLA website: https://www.bvrla.co.uk/
In your opinion, how prepared is the leasing sector to sufficiently support customers through these changes? Are new products and services required? If so, what do you believe these are?
Zenith is supporting its customers through short and long-term changes in the fleet environment through strategic work and hands-on help. We are actively updating customers on changes that may affect them and working closely to provide recommendations and adjust policy as required.
Zenith is very active with industry bodies, such as BVRLA, to engage with key stakeholders within Government to lobby on issues that are impacting our industry. More recently, Zenith has supported the Road to Zero publication issued by BVRLA and supporting letter to the Chancellor, which sets out the challenges the Road to Zero will bring for the current taxation system and starts the debate on viable alternatives. Early engagement is key to ensuring lease customers and businesses are represented when the Government is considering a policy change.
The team at Zenith works in partnership with customers to understand the needs of their individual business and move with the market to meet their requirements. Each dedicated customer relationship manager is supported by the consultancy team to deliver bespoke advice.
It is key that lease companies are agile and can adapt to the external environment. Zenith is here to ensure each customer has the right products and services at the right time. What new products are required very much depends on the type of fleet under management and each company’s strategic objectives. Supporting cleaner technologies and increasing utilisation of autonomous and connected technologies will be key areas for product development in the future.
With the issues around electric vehicle availability, and the desire to get to zero for fleets, do you feel ECO schemes could offer a potential route for fleets to have shorter leasing until more vehicles are available?
ECO schemes have always played an appropriate role in a portfolio of products. However, with the release of the OpRA legislation the established scheme architecture has changed.
For fleets who operate under the right criteria, low-cost vehicles, high business miles and large Benefit-in-Kind (BiK) based contributions, there is the availability in the short-term to make significant savings. However, companies need to have a clear decision-making structure and ability to adapt processes to enable this type of scheme to be implemented and run efficiently.
In addition, the cost efficiency relies on contributions that often equate to BiK in the current scheme architecture of ECO. For cleaner fuels such as electric from 2020, the BiK percentages are much lower than petrol and diesel fuel types resulting in a drop for the driver in their contribution levels. This will make low emitting cars more cost effective through contract hire funding.
Should I be bringing electric vehicles on fleet?
It’s time to look ahead and ensure your fleet policy is fit for purpose now to help reap the rewards of electric in the future.
Understanding daily travel needs and being able to accurately compare on a whole life cost, post tax basis, over the vehicle term is key to help the roll-out and secure the benefits of electric vehicles in the future. It’s no longer good enough to simply look at annual business miles. Fleet operators need to ensure they have the resources available so they can decide which fuel type is best for which group of drivers.
Key factors to consider:
- Company car tax rate reduces significantly for electric (from 16% to 2% in 2020) so drivers will be incentivised to move into electric cars
- Manufacturers’ electric line-ups will be more varied with key lower cost cars being included in their expanded electric vehicle offering
- Increased electric range and government investment in charging infrastructure which will improve the situation for fleet drivers, with more options for charging their vehicles on the road
Working closely with leasing suppliers and manufacturers will keep you informed about future vehicle releases. It allows early trials of electric and alternative fuel cars, vans and trucks to know where these can work, and the real-life savings opportunities.
With the increasing trend to opt out of company cars, what options do we need to provide for our employees?
Considering the driver’s BiK costs will help set a car policy that is fit for the future. How much are they prepared to pay for their company car? Employees might not want to pay for the highest specification levels or could be willing to consider a broader range of manufacturers outside of those traditional premium brands.
Employees need flexible options to choose whatever suits them best, whether that’s a company car, a salary sacrifice car or a personal lease, and fleets must adapt to the changing environment to deliver options appropriate for both business need and perk employees.
Further growth is expected in personal contract hire (PCH). The recent findings from the FCA report will steer consumers towards good practice and PCH’s structure, which is simpler than personal contract purchase (PCP).
Employees are looking to their employer’s reward package to help them with their next car choice.
Are you ready?
Zenith is here to ensure you don't get left behind. Submit a question to our Bright Sparks today.