Fleet News

Guest opinion: Car rental rises can be avoided

It has been well-documented that car rental prices are on the up because the basic costs of providing the service are rising, including cars, fuel and general day-to-day administration.

This is the first industry-wide price increase in the rental industry for some years, but with car prices likely to stay where they are and fuel prices above the £1 a gallon in many areas of the UK, fleets could continue to face higher bills.

However, Avis believes fleets shouldn’t automatically accept higher prices – instead they should be working with their rental supplier to look at cost and administrative efficiencies.

Avis’s Total Cost Management approach looks at all elements of the rental rather than just the headline price of the car. It aims to identify cost efficiencies across the entire process, from when the car is booked to making best use of the monthly management data generated.

At the heart of this exercise is the adoption of a corporate rental policy which provides a structured approach to all aspects of renting a car.

It allows fleets to automatically restrict employees to only renting certain car groups, petrol or diesel models, manuals or automatics, whatever matches their individual rental requirements, ensuring drivers do not opt for a larger, more expensive car when they don’t need one.

There are a myriad of insurance options which are available, many of which are not relevant to every renter, especially if a company is self-insured and manages its own risk. As part of a corporate agreement you can specify the insurance cover required which is given automatically each time a car is rented, thus taking the choice away from the driver.

The standard refuelling policy with rental companies is that a car is returned with a full tank, but unless this is communicated clearly to drivers, many may not automatically carry out this instruction. To avoid paying for fuel, make sure you include this in your vehicle handover, rental booking and company induction process and you should have all avenues covered.

In fact changing driver behaviour is a major influencing factor on managing rental costs. Avis sees around 5% of cars being returned with damage on them, which it has to pass onto the corporate renter. In some cases something as minor as a damaged bumper or door mirror can cost a couple of hundred pounds to repair.

Follow the same process applied on fuel and you should see drivers being more careful when at the wheel of their rental cars.

The same applies to congestion charging where drivers often don’t pay their £8 as they are at the wheel of a rental car and miraculously expect someone else to pay the fine. Remind drivers they are liable for paying the congestion charge and any fines they may pick up, just as they would in their company car.

Another area where companies can reduce cost is by booking cars online.

Initiatives such as the provision of micro-sites where companies can manage all their rental requirements through their intranet, ensure they can book their rental car around the clock. The intranet should be set up to include the corporate rental parameters, thus ensuring another control over cost.

Last but not least, rogue drivers can often be identified through management reports received from a rental supplier. Exception reports on drivers whose rental costs or damage levels are consistently higher than average should be targeted for a letter or a one-to-one chat with their employer.

They may be genuinely unaware of how the rental process works because they have never driven a rental car before, but unless it is addressed costs could well continue to rise.

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