Fleet News

Fuel cuts pave way for big fleet savings

ACROSS-the-board fuel duty cuts are set to save the fleet industry hundreds of thousands of pounds in running costs - but fleets which cannot access ultra-low sulphur fuel are set to lose out. Ultra-low sulphur petrol has seen a 2 pence per litre (9p per gallon) cut in duty, which amounts to 2.35ppl (10ppg) including VAT savings.

The same cut has been introduced for drivers using unleaded fuel until June 14 to ensure they are not unfairly penalised for not having access to the fuel. But the duty rate of 46.82ppl (212.8ppg) for unleaded is still 1ppl (4.54ppg) more than for ultra-low sulphur petrol, so there is still a penalty if fleets cannot access the cleaner fuel.

Using ARVAL PHH's fuel cost calculator, for an average fleet of 200 vehicles, with each covering 20,000 business miles a year and averaging 30mpg, the differential runs into thousands of pounds. If the fleet is running on unleaded fuel, its fuel bill would fall from £469,133 to £457,027, a saving of £12,107 or 2.6% per year. However, while a fleet running on ultra-low sulphur petrol will see the same £12,107 fall, its fuel bill would only be £450,973, a saving of £7,000 a year.

For diesel drivers, there is a reduction of 3ppl (13ppg), equivalent to 3.52ppl (16ppg) after VAT, only on ultra-low sulphur diesel, although this is already available nationwide. For the same 200-vehicle fleet, with cars covering 20,000 business miles a year, but achieving 42mpg because diesel vehicles are more efficient, the fuel bill would fall from £350,661 to £337,690, a saving of £12,971, or 3.7%.

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