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Driving down costs on car schemes

PRESSURE to control costs and environmental damage is causing businesses to put greater restrictions on company car policies, according to PwC’s Company Car UK report.

While the number of companies offering a car benefit has remained fairly static over the last five years, increasing limits are being placed on vehicle choice and replacement timeframes.

Specifically the report shows that 21% of companies intend to reduce the choice of car available, while 15% of firms plan to provide cheaper cars.

Meanwhile, one in four companies are planning to extend lease periods and 37% of companies have placed a CO2 emission limit on car choice.

Over one third (36%) of companies have restricted choice to diesel only, reflecting the growing popularity of diesel cars which outsold petrol models for the first time ever in Britain last month.

Restrictions have also been imposed on certain types of car due to safety concerns. For instance, 79% of companies have placed restrictions on sports cars and 76% on convertibles.

The greatest rise in restrictions has been for petrol turbos (45% of companies, up 5% on last year); four-wheel drive cars (34%) and people carriers (14%), both up 4% on last year.

These restrictions are likely to be driven more by the green agenda. Generally the most significant increase in car choice restrictions has been among financial services firms.

For company chairmen and CEOs though, the choice of car is unlimited in 80% and 75% of companies respectively.

Jonathan Downes, human resource services at PricewaterhouseCoopers LLP, Newcastle said: “Company cars remain an important benefit in many businesses, reflecting employees’ needs and wants. For those companies with a large mobile sales force, cars are clearly essential to the business.

“However, companies are balancing these requirements with the continued need to reduce costs and environmental impacts, as part of their corporate responsibility agenda. The two goals go hand in hand, thanks to various cost savings related to greener car policies.”

This was posted in Bdaily's Members' News section by Ruth Mitchell .