Fleet News

Contract hire survey: five-door city cars

BUDGET motoring doesn’t get any cheaper than the cars pictured below, but which one is the best bet for a fleet? Our panel of leasing experts benchmarks the latest city cars

Cheap, cheerful and not likely to break the bank

ALTHOUGH these cars are never going to be a core fleet choice, they still have a valid role to play within companies.

With their ultra-low prices, cheap running costs and ease of driving, they make the perfect type of vehicle for companies which need to send staff into busy towns and cities or which need a bargain basement pool car.

And the sector is seeing plenty of launch activity at the moment, thanks to the joint venture between Citroen, Peugeot and Toyota with the C1, 107 and Aygo respectively.

All three models share the same chassis, engines and gearboxes, with only different body styles and some badging to differentiate one from the other. They face a crop of city cars which major on funky style and ease of driving, led by Fiat’s Panda.

But there is also a strong presence from South Korea in the shape of the new Kia Picanto and the Chevrolet Matiz (formerly a Daewoo but now renamed and made an honorary American).

And in this sector, the Korean cars do not suffer as much in terms of residual values as their larger stablemates, giving the volume players a tougher time in leasing costs.

Citroen C1 1.0i Vibe 5dr

P11D price £6,732
2005 CO2 BIK tax bill (22%) £239
2005 VED bill £75
Rental Rates
Lombard £164
Masterlease £176
Custom Fleet £171
Arval £172
Alphabet £179

Chevrolet Matiz 1.0 SE 5dr

P11D price £6,452
2005 CO2 BIK tax bill (22%) £213
2005 VED bill £105
Rental Rates
Lombard £143
Masterlease £161
Custom Fleet £171
Arval £182
Alphabet £168

Fiat Panda 1.1 Active 5dr

P11D price £6,452
2005 CO2 BIK tax bill (22%) £213
2005 VED bill £105
Rental Rates
Lombard £165
Masterlease £170
Custom Fleet £162
Arval £159
Alphabet £160

Kia Picanto 1.1 LX 5dr

P11D price £6,452
2005 CO2 BIK tax bill (22%) £213
2005 VED bill £105
Rental Rates
Lombard N/A
Masterlease £166
Custom Fleet £165
Arval £172
Alphabet £175

Peugeot 107 1.0 Urban 5dr

P11D price £7,232
2005 CO2 BIK tax bill (22%) £239
2005 VED bill £75
Rental Rates
Lombard £165
Masterlease £190
Custom Fleet £178
Arval £182
Alphabet £186

Toyota Aygo 1.0 VVT-i 5dr

P11D price £6,882
2005 CO2 BIK tax bill (22%) £227
2005 VED bill £75
Rental Rates
Lombard £152
Masterlease £180
Custom Fleet £167
Arval £155
Alphabet £177

Richard Schooling, Commercial director, Alphabet (GB)

Product and position will be the keys to whether this class moves beyond a niche role as far as fleets are concerned.

The well-equipped and nominally five-seat Kia Picanto is the most popular of the three established models. But like the Matiz, it is let down by dull looks, a noisy ride and a mediocre safety rating.

Fiat’s competitively priced Panda offers plenty of character. Its residual values are not bad, either, although it too comes with just a three-star Euro NCAP crash test score. PSA Peugeot Citroen and Toyota’s new city car range is definitely the best choice for fleets looking to add a low-cost rung to their policy ladders. Attractively styled and with the equipment levels drivers expect, they also offer good soundproofing and four-star safety ratings.

But branding is a key issue and Peugeot’s strong fleet presence and acceptance should give the 107 the edge over the C1 and Aygo.

Paul Connor, pricing risk manager, Lombard

THIS sector grew by more than 7% last year, fuelled by the Picanto (on which we do not quote) and Panda, but the ageing, three-door Ford Ka was still the top seller.

Now there are three new entrants, but as they are a Toyota/Peugeot/Citroen venture they are almost identical, and will to some extent be fighting over the same customers. This could have a negative effect on residuals, as there will inevitably be incentives. The Matiz has easily the lowest rentals but also the lowest residuals by some margin and cannot compete dynamically against these much newer competitors.

The Panda is a good car but its SMR cost makes it relatively uncompetitive.

The choice is between the new trio. Of the French pair the Citroen C1 has the lower rental and the Peugeot 107 the better residuals. But the Aygo is the best choice. Not only is it the strongest brand, it has strong residuals, too.

John Pout, head of strategic and international sales, Arval

THE menu this month is not stocked with fleet favourites, but these are cheap to buy, cheap to run and will not punch as many holes in the ozone layer compared with standard cars.

The French are really good at small cars, and if you have ever tried to park in Paris you’ll know why. The Citroen is built for town driving but take it out on the motorway and you will feel all the bumps. Keep it in the city and it is a joy. Good looking, fun to drive and reliable thanks to the collaboration with Toyota.

Forgetting looks, the Fiat Panda’s road handling is good and Fiat has focused on safety options to make this an attractive proposition.

Shorter than a Mini, the Aygo feels like the C1, and with good reason – it is the same underneath. The Peugeot is solid, reliable, looks good and handles well – until you get on the open road.

The Picanto is short on style, but it is practical and cost-effective. With a three-year/unlimited mileage warranty and lots of kit, it is sensible but dull.

The Matiz sounds exotic, but is much like the others. A good town runaround but not very exciting inside and don’t ask any long-legged passengers to sit in the back.

Nick Auld, trade services manager, Custom Fleet

YOU would not expect these cars to be covering 20,000 miles a year, but they will find a place within the NHS and public sector, and as pool cars around our increasingly busy towns and cites.

These cars’ combined fuel consumption is 57 mpg which is quite astonishing, emphasising that they would be very appropriate around town and they have CO2 emissions as low as 109g/km.

Smart started this sector and other manufacturers have been quick to copy, especially Citroen, Peugeot and Toyota with their current collaboration. There is very little to choose from between them as they are basically the same car with different skins and badges. But if we had to pick one we would go for the Aygo because is better looking and has probably the strongest brand appeal.

The Fiat Panda is excellent value for money and has the lowest rentals, so it would be our second choice.

Kia is an up-and-coming brand and the Picanto offers excellent value for money.

The elder statesman of the group is the Chevrolet Matiz which has undergone a brand change from Daewoo and is now looking long in the tooth.

Robert Redman, senior pricing analyst, Masterlease

This sector hasn’t traditionally been well represented on many fleets, but a growing number of people are opting for this tax efficient type of vehicle.

The Toyota Aygo, Citroen C1 and Peugeot 107 are built as a joint development, so as they are essentially the same car it’s difficult to choose one on looks and spec alone, so the C1 wins as its list price is the lowest.

Fiat has always made great city cars and the new Panda carries on in that tradition. This car is chock-full of character, good to drive and competitively priced.

The Matiz has always been a good city car and the revisions made when it was re-badged from Daewoo to Chevrolet have made quite a difference – there’s more boot space, reworked engines and even greater cabin space than before.

Kia doesn’t really have much presence in the fleet market and I haven’t had much experience of their products.

The Picanto is well priced, reasonably well specified and fairly pretty but I would need to see more of a commitment to fleet before I could recommend it over more established contenders.

Average leasing rates

THE Fiat Panda offers the lowest monthly rentals, followed closely by the Kia Picanto. The French duo are expensive in comparison, with the C1 costing £172 a month and the Peugeot 107 a highish – for the sector – £180.

CO2 emissions

THE Citroen, Peugeot and Toyota all share the same engine, giving identical CO2 emissions. and even though the Matiz is well off the standard set by the others, it still falls into the lowest 15% company car tax band.

Fuel economy

THE C1, 107 and Aygo share the same engine so they all record identical fuel economy figures of an impressive 61.4mpg, easily clear of the Kia and miles ahead of the Panda and Matiz, which record disappointing fuel figures.

Residual value forecasts

IT IS no surprise that one of the newest cars tops the RV chart, but it is surprising that the 107 has a better RV prediction than the Aygo. The C1 trails its cousins – perhaps due to Citroen’s many cashback offers.

Average net price of cars to leasing firms

TOYOTA leads the way in support with the Aygo, offering more than £1,000 off, whereas Peugeot offers the least, averaging just £735 discount. Fiat and Kia are fairly generous with their backing.

Average maintenance costs

THE South Korean cars top and tail this sector. The Kia is the most expensive car in SMR terms over three years and 60,000 miles, costing an average of £1,488, while the Matiz is easily the lowest on £954.

How the panel voted

1. Toyota Aygo

ONE of the new trio from Citroen/Peugeot/Toyota was going to win this contest, and it’s the Aygo which takes the spoils thanks to strong support, low emissions and high fuel economy.

2. Citroen C1

THE C1 does everything its close cousin does, but its residual value prediction isn’t as strong and its monthly leasing rate is slightly higher. The C1 loses out through a lack of manufacturer support.

3. Fiat Panda

BAGS of character and a fun drive see the Panda score well, as does strong manufacturer backing and a competitive monthly rental rate. However, poorer fuel economy counts against it.

4. Peugeot 107

PEUGEOT offers the least amount of support to leasing firms in this sector, and as a result the 107 has by far the highest monthly rental. However, its does offer the strongest RV proposition.

5. Kia Picanto

KEENLY priced, well specced and fairly attractive – the Picanto scores well in several areas, but the industry still sees Kia as an up-and-coming brand and not an established player.

5. Chevrolet Matiz

THE Matiz has been around for a long time now, and the recent rebranding from Daewoo to Chevrolet and the facelift haven’t done enough to boost its popularity.

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