Companies are starting to replenish their fleets but many are taking a harder line with the number of manufacturers on their choice lists due to rising new car prices, according to delegates at the Fleet News round table briefing in association with the RAC.

Multiple price hikes by the main manufacturers last year, blamed primarily on exchange rate fluctuations, have seen cars move out of employee bandings and come with higher wholelife costs.

Mandy Price, contract specialist at Sellafield, which has 300 cars and 250 vans, said: “We have felt the pinch as manufacturers increased prices.

"We have had to rationalise the number of manufacturers we use and have also reduced our bench model to keep costs down.”

Her colleague, Sue Carrillo, added: “Our staff could have any car that they wanted so we didn’t get the big volume discounts.

"We discussed this with HR and we looked at the fleet and found that many cars were BMW and Audi, so we went for them to increase our discounts by giving them more business.”

Siemens has recently extended its replacement cycles from three to four years, selling the idea to staff on the cost savings it would achieve.

But commodity manager Paul Tate explained: “The savings have been wiped out by manufacturer price increases. We agreed discounts, then prices rose again.”

Extending replacement cycles is an option favoured by many fleets, but changes in the UK have not been a drastic as elsewhere in Europe, according to Ian Worthington, Cargill Group fleet manager.

“We have brought in a pan-European policy which has seen contracts extended to five or six years in some countries.

"We fought to keep ours to four years,” he said. “We have around 200 cash-takers that we are trying to bring into the company car fleet and it would not be possible if contracts were that long.”

Dennis Dugen, travel and car fleet manager at WSP Management Services and a former ACFO regional chairman for the north-west region, believes it has been relatively easy for fleets to extend replacement cycles – staff have been understanding due to the recession and are happy simply to have a job.

But, he added: “People feel that they have played ball and that now it is time for the company to play ball. Further extensions will be difficult.”

On the question of reducing badge choice, Dugen said it was a finance versus HR argument.

Even in the depths of recession, the needs of staff can take precedent.

“If you go with one manufacturer you will raise discounts but you will also have a lot of unhappy staff,” he said.

Dugen believes the argument is similar to the question of whether a fleet chooses one leasing company or benchmarks across a number.

“If you want low upfront rates, then go for a lot of companies to compare prices,” he said.

“But if you want a better relationship throughout the lifetime of the contacts, especially with back-end costs, then you will have more influence when you have a lot of vehicles with one supplier – typically more than 100.”

He adds: “Admin costs are higher when running an operation with lots of different leasing companies.”

Tate keeps a close eye on the level of service Siemens gets from its three leasing providers.

“We have a supplier evaluation form which shows what they have done each month to help us reduce our costs,” he said.

“We score them and it means we can demonstrate that our leasing provider is being proactive.”

Firms are increasingly managing their grey fleet drivers in the same way as their company car drivers when it comes to training and risk management in recognition of their duty of care responsibilities.

Wherever possible, they are keen to bring them back into the in-house fleet.

Carol Rhodes, senior commercial manager, HMRC, said: “We are targeting our higher mileage drivers to bring them into the company car scheme. We have met the unions and HR and are now waiting to do it.”

At WSP, grey fleet drivers undergo the same training audits as company car drivers.

“They accept that the company is taking a closer interest,” said Dugan.

The RAC is looking to develop an insurance product that fleets can subscribe to which gives access to licence checking and driver training.

Ed Corrie, RAC partnership manager, said: “It will give fleets another option to put private vehicle employees through training.”

Clarke Group has installed telematics in its van fleet.

Fleet manager Joanne Shepherd said: “It means we can monitor speed and idle times, and our regional managers can check time sheets.

"There’s also duty of care – it tells our drivers that we are looking after them. They realise they are being monitored and reduce their speed.”

Fleet has risen up the agenda at Swift Fire & Security as the board took greater interest during the recession.

Helen Swift, fleet manager, said: “We look at our accident rates over the previous three years.

“We have just had a good year replaced by a bad year and that has seen a 30% increase in our insurance premiums.

“Our focus next year will be reducing accidents through driver training.”

All fleets agreed that companies were increasingly taking health and safety and duty of car responsibilities seriously, despite the lack of legal cases.

Corrie summed up the general view: “Everyone is waiting for the first big legal case to happen.”

The panel and its big issues

  • Dennis Dugen, travel and car fleet manager, WSP Management Services – 500 cars “Duty of care for cash takers”
  • Paul Tate, commodity manager, Siemens – 4,500 vehicles (UK)
  • “Reducing costs across the board”
  • Helen Sleigh, fleet manager, Swift Fire & Security – 160 vehicles
  • “Reducing costs across the board”
  • Carol Rhodes, senior commercial manager, HMRC – 2,500 vehicles
  • “Reducing the number of accidents and reducing repair costs”
  • Michelle Lees, fleet commercial officer, HMRC – 2,500 vehicles
  • “Reducing costs and fuel savings”
  • Sue Carrillo, contract assistant, Sellafield – 300 cars; 250 vans
  • Mandy Price, contract specialist, Sellafield - 300 cars; 250 vans
  • “Reducing costs across the board”
  • Joanne Shepherd, fleet manager, Clarke Group – 200 vehicles
  • “Online training and using fuel card reports to reduce costs”
  • Ian Worthington, fleet manager, Cargill Group – 160 vehicles
  • “Duty of care for cash takers”
  • Jamie Normansell, SME team leader, RAC
  • Ed Corrie, partnership manager, RAC
  • Stephen Briers, editor, Fleet News