Fleet News

Automatic transmission drivers prepared to bite BIK bullet

COMPANY car drivers are prepared to pay hundreds of pounds extra in benefit-in-kind tax under the 2002 carbon dioxide emissions-based regime to retain cars with automatic transmissions. Despite automatics in some cases being seven tax bands worse than their manual equivalents, vehicle manufacturers and fleet operators say they do not expect the new 'clean' company car tax system to kill off 'dirty' automatics.

Research reveals that just 31 automatics out of 885 models offering the transmission as an option on sale in the UK have CO2 emission figures either the same or below manual equivalents. However, a few modern automatic transmissions and clutchless manuals offer similar emissions performance to conventional manuals. For example, a Mercedes C240 produces fewer CO2 emissions as an automatic than a manual, while figures for Alfa Romeo's Selespeed clutchless manuals are the same as the standard manual.

But a 40% taxpayer would have to pay £960 a year more for the privilege of driving an automatic BMW 530d SE as a company car than a manual. Fleets typically account for about one third of all automatic sales and, despite the potential increase in the tax burden on most drivers, some manufacturers are reporting an increase in fleet sales of self-shifting transmissions.

Vauxhall sales operations manager Keith Michaels said its fleet sales of automatics for the first three months of 2001 was 13.2% of total fleet sales compared with 11.7% last year. He said: 'If fleet drivers were being properly informed, you would expect to see a shift in the other direction. Fleet managers should wake up to the fact that they must give their drivers the right advice. Many drivers would choose automatics for convenience, but if they really knew it was going to cost them money they might think again.'

Fleet managers have signalled that the introduction of the new tax regime will not mean the end of the line for automatics. The health and safety benefits offered by an automatic transmission to high mileage drivers, particularly allowing them to concentrate solely on driving and not changing gear, means that the key decision-makers are keeping them on fleet. Phil Redman, IBM's fleet manager, said: 'Our drivers are aware of the implication of driving an automatic under the new tax system. Some drivers will pay heavily but that does not change the fact that drivers weigh up the advantage of automatic and make their own choice.'

Redman's concerns about health and safety were underlined by Simon Boggis, group fleet procurement manger for TNT UK, who has been working to make his drivers aware of the implications of the changes to company car tax. Boggis, whose fleet is 98% manual transmission, believes that the changes to company car tax will lead manufacturers to make 'cleaner' automatics.

Alan Peace, national fleet manager for Highways Glass, said: 'Some drivers are being told that they can save up to £40 a month by moving into a manual. That amount of money is not to be sniffed at and it raises serious concerns about drivers opting for the short-term benefits rather than looking at their long-term health.'

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