By Peter Eldridge
The role of the modern fleet manager is changing. Gone are the days of the ‘interested amateur’ entering the world of fleet management without obtaining the skills, knowledge and accreditation that are essential to successfully adapt to the changing world of technology.
Since time immemorial, they have developed fleet policies around traditional areas that include:
- Vehicle allocation and selection
- Fleet funding
- Operational and driver management
- Pool and short-term hire vehicle allocation
- Warranty and goodwill claims
- Fuel cost
- Vehicle replacement policy
- End of life charges
These areas remain important ingredients for an effective fleet policy but, over the past few years a wind of change has entered the fleet arena, which is completely changing the way employees with fleet responsibility should look at managing their vehicle operations.
There is a real need to evolve the leadership disciplines which is being driven by unprecedented changes that affect not only the fleet managers, but also their peers from HR, finance, procurement and compliance.
It is not only the changes in technology that are having impact, it is the incredible speed that intelligent motor vehicle systems are changing the face of the UK automotive industry as we know it.
The case for businesses to employ accredited fleet professionals has never been stronger and it is vitally important to acknowledge that today’s fleet managers, supervisors and administrators will need to morph into ‘mobility managers’ in order to drive further efficiencies forwards.
All fleet professionals must be able to demonstrate or achieve an acknowledged and credible standard, since that is now the prerequisite for managing a vehicle fleet.
So, what should be the plan to move forward?
- You may not have a crystal ball that gives all the answers regarding where you will be in three years’ time, but it is vital you arm yourself with the correct level of skill and knowledge required to keep on top of the changing face of fleet operation – the ICFM is a good place to start”
- Embrace the fact that ‘new age’ fleets must include a team of stakeholders from varioous departments, who should each take shared responsibility for the financial, operational and compliance aspects of the fleet operation. To evolve your fleet successfully it is essential to eangage with and get the support of representatives from each of these areas and create a plan for the continuing successful operation of your vehicle fleet.
- Review your fleet policy as a team and ensure that it fully reflects the culture and requirements of your organisation. In any case, acknowledge that a vehicle fleet policy is intended to be dynamic and should be changed as circumstances change. It will improve the quality of information on transport trends and/or vehicle performance and will assist in the identification of policy changes required to enhance performance. As a minimum, vehicle fleet policy should be reviewed annually.
- Adopt a strategic approach and focus on the topics/challenges that have been/remain on the fleet agenda (see below).
- Communicate with your drivers, don’t forget that they are also likely to be suffering from the effects of all of these changes and are looking for guidance to make an informed choice regarding their next company car/no company car decision. It is therefore vital that effective lines of communication are drawn up to keep all drivers aware of developments but beware of ‘information overload’.
- Finally, don’t be daunted by the prospect of change. Yes, the future is approaching faster than we think, but the time to act is now and it makes for exciting times ahead.
Key considerations for modern fleets
There are a number of issues and challenges that the modern fleet decision-maker needs to consider when developing their business strategies, according to ICFM.
- Changes to benefit-in-kind (BIK) taxation. The Government has just closed its consultation into how the company car tax system should change due to the implementation of Worldwide harmonised Light vehicle Test Procedure (WLTP) and the impact that it is having on CO2 emissions and, therefore, BIK, the range of vehicles available, new vehicle supply and vehicle specifications/extras.
- Government pressure for fleets to embrace plug-in vehicles that can be further expanded to include a review of fuel types operated and whether diesel remains as the number one choice. Add to that the issues with BEVs and PHEVs that the ICFM has regularly highlighted, namely a recharging infrastructure that is far from complete, dilution/removal of the plug-in grant, rising company car taxation to the end of 2020/21 and PHEVs viewed as a tax dodge with many fleets experiencing significant fuel cost increases.
- Companies reporting under the International Accounting Standards Board (IASB), such as listed companies, banks and some public interest businesses, which contract hire their vehicles now have the new lease accounting standards that became effective from January 1, 2019, to take into account.
- The connected car, ‘big data’ and data protection with the May 2018 introduction of the General Data Protection Regulation (GDPR) which promises to be another ‘minefield’ for employers and fleets.
- The continuing fallout from the 2017 tax changes impacting on both car salary sacrifice and car or cash allowance programmes.
- The development of clean air zones (CAZ). The first CAZ to be introduced will be London’s Ultra-Low Emission Zone (ULEZ) on April 8. It has been well publicised; there are more than 300 ULEZ warning signs across central London informing drivers of its introduction.
- Automated vehicles in urbanised areas, increasing low carbon technological development, vehicle sharing, broader mobility options are all in the melting pot.
- Mobility as a Service (MaaS), millennials, car-sharing and car clubs and the differentiation between ‘job car’ and ‘perk car’ with Generation Y (those born in the 1980s and 1990s) now entering the working world and starting to influence business and corporate mobility.
- Business mobility shifting from a way of exercising social status (the traditional hierarchical company car) to a method of streamlining efficiency.
- Brexit: the ongoing uncertainty that continues to plague the UK is having a profound impact on the fleet industry. Businesses that have put investment on hold may spend again, so keep an eye on developments.
Peter Eldridge joined ICFM in 1993, making him one of its longest-serving members.
The ICFM was founded in 1992 and remains the UK’s only independent, not-for-profit organisation dedicated to furthering the education, recognising the achievements and advancing the profession of car and light commercial fleet management.
Eldridge joined the ICFM steering committee in 1996 and became a full council member in 1997. He was appointed a director in April 1999 and is regarded as one of the institute’s strongest lead tutors.
In 2011, he was inducted as an honorary fellow of the ICFM.
Eldridge now focuses his time on the ICFM. He has enjoyed a successful fleet industry career, which started at Fiat Auto UK in 1963.
It includes spells as fleet manager of a large blue-chip fleet operation and senior management positions within the franchised motor trade.
For information about ICFM leadership and management training, go to www.icfm.com