Fleet News

Company cars increase in popularity

The trend towards providing company cars is set to continue into 2008, after 96% of employers said they expected more drivers who need a car for their job to opt for a company car.

This is up 8% on the same period in 2006.

In addition, 67.9% employers predicted that more employees would be offered a company car as part of their employment package, which is up 6.7% year-on-year.

The findings are contained in the GE Capital Solutions quarterly Company Car Trends report.

The figures continue developments seen in Company Car Trends for more than a year, and suggest that the company car is staging a comeback following years when it has been widely accepted to be in decline.

Almost 100% of job-need drivers are now offered a company car by their employer as well as 78% of non-essential car users - this latter figure has risen 8.8% in the last 12 months. 

This resurgence of the company car has been at the expense of cash for car schemes, says GE.

“Popularity of these has dipped by 5.8% year-on-year among job-need drivers, for example, and employers expect a further fall of 4.2% in this provision during the next 12 months.”

Indeed, cash for car schemes have dropped in popularity as a method of acquiring a car by 9.6% since 2006 while contract hire, outright purchase and outsourced fleet management have all increased slightly in use.

Overall demand for all types of business car is set to rise at a predicted 4.2%.

Rich Green, managing director at GE Capital Solutions Fleet Services, said: “A situation has developed where employers are trying to pull both job-need and non-essential drivers back into traditional company cars, and employees are also pushing to get back into them.
He the reasons for this are three fold: employers need to meet legal responsibilities for employee safety; the growing importance of environmental issues.

It is easier to ’green’ a fleet if companies have direct control over the vehicles their staff are driving; and many employees who have tried taking the cash for car option have switched back into a company car when given the opportunity, often because of the expense of maintaining it.

 

 

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