Alphabet has launched a corporate car sharing scheme which it claims will overcome the drawbacks of traditional pool cars, as well as providing an alternative to daily rental, taxis and staff using their own cars for business trips.
It believes AlphaCity is the first corporate car sharing scheme in Europe to operate on a leasing model. Customers pay a standard monthly contract hire rate, which varies depending on the model, term and mileage, plus a 20-25% premium for hardware and management services.
Kit Wisdom, mobility manager at Alphabet, said the premium service includes “everything a company would normally do itself with a pool car”.
Monthly vehicle checks and cleaning; vehicle branding if required; maintenance and accident management; insurance if required; an online booking tool; membership cards to access the vehicle; a 24/7 customer service team – rather than the company’s fleet manager or reception dealing with driver queries; and the ability to offer vehicles for private use.
Richard Schooling, chief executive of Alphabet, pointed out that traditional pool fleets are usually “inefficient”. “You tend to have vehicles standing there ‘just in case’,” he said. “They might sit there in the evenings and weekends, not utilising the organisation’s cash properly.”
A key advantage of AlphaCity is the business can charge employees to book cars for personal use. The system can take credit card payments with the proceeds being used to offset some of the total monthly cost of the scheme.
To avoid benefit-in-kind taxation companies should set private use at local market rates.
All AlphaCity cars are BMW and Mini models – the Mini hatch, clubman, convertible, BMW 1 Series and X1 – primarily so that BMW’s factory-fit telematics and communication platform (BMW Connected/Mini Connected) can be used. It also enables keyless entry and keyless stop start.
“Compared to daily rental where you book a vehicle group you know the vehicle you will get,” Wisdom said.
Unlike car clubs, which are usually based in cities, companies can choose the area or geo-fence where the vehicle can be on and off hired. For instance, a company could select its five office locations.
Specific cost centre billing can be done if required.
“This is a great tool because with daily rental it can be a challenge to make the costs go to the right cost centre,” Nigel Trotman, head of strategic consultancy at Alphabet, said.
The company can also set minimum requirements for drivers, such as driving experience, and it can decide whether to penalise drivers for failure to report damage, or refuel a vehicle or return a vehicle on time or to the right location.
Summary and detailed reporting can also be provided showing who rented a vehicle, when and how many miles they travelled. Business versus private reporting is available.
“The golden rule is about 50 members per car to make sure it is utilised in the right way,” Wisdom said.
Trotman advised putting two vehicles in, running them for three months and then reviewing whether more are needed.
It helps if a company has data, such as annual grey fleet mileage, when building the business case.
“We have spoken to a couple of NHS Trusts that can see real potential in the scheme,” Trotman said.
Companies with large operations in major cities can also see the benefit of replacing taxis with AlphaCity, according to Trotman.
Two major private sector companies are already close to being the first companies in the UK to sign up to the scheme.
Accenture in France (who worked on the original idea with Alphabet in 2010) and Infinium in Germany are already using the scheme. In the first month Infinium has had 650 drivers register and 150 bookings. Vehicles are being used at Munich airport and Trotman envisages AlphaCity being used at UK airports in the future.