Fleet News

Zipcar to target SMEs for growth

Pay-as-you-go car and van provider Zipcar has seen a rapid increase in business users over the past year as it targets "inflexible" company car packages.

The company, which was recently purchased by car rental giant Avis, says it now intends to increase its focus on the sector in order to help more small and medium-sized enterprises (SMEs) cut transportation costs while simultaneously increasing the flexibility of their company vehicles.

It recently commissioned research from YouGov which discovered that companies can make financial savings of up to 20% by using pay-as-you-go vehicles as part of their transportation policies.

The research – which surveyed 506 SMEs – also found that companies are paying for company-owned vehicles that sit idle for 63% of the working week.

And 17% of decision-makers within these businesses were "completely unaware" of the total annual company costs spent on transportation.

Andrew Edgar, head of Zipcar for business UK, said: "I think that one of the main reasons why the business side of Zipcar in Britain has grown faster than the consumer side is because those who choose to use us find that it makes financial sense.

"We now have 1,000s of business customers and our new research shows that there’s opportunity for these companies – and others like them - to save costs."

He continued: "Depending on a company’s needs, there will often be occasions when a pay-as-you-go vehicle will suit their needs better than making a longer term commitment through leasing a vehicle permanently.

"But we recognise that we are part of a far bigger mix – if that company has specialist requirements like refrigerated vehicles then we will not be able to help."

Zipcar currently operates in 31 London boroughs as well as Bristol, Cambridge and Oxford. It has a total of 1,500 vehicles spread across these locations.

Of these, 90% are passenger cars - which range in size from Volkswagen Polos to Tourans – with hourly rates from £3.96 and daily rates from £39.17.

The remaining 150 vehicles are Volkswagen Transporter vans which are priced from £8.80 an hour.
Zipcar members – who pay an annual subscription - benefit from: 40 miles of fuel, insurance, maintenance, roadside assistance, road tax and the Congestion Charge when travelling in London.

When asked whether Zipcar has any intention to launch its service elsewhere in Britain, Edgar replied: ““We are always looking at expanding our presence in cities in the UK where we don’t operate.

"But we have to a strong reason for that expansion – and consequently we are always open to approaches from businesses and organisations in other cities which realise that they could use our services."

Zipcar’s research also discovered that 31% of businesses do not have a transport policy in place and – of those that do – 38% feel that their current plan could be improved.

Edgar encouraged all fleet managers to remedy this and to consider using pay-as-you-go vehicles when appropriate.

He added: "It’s important that companies do what’s best for them – and that they don’t overlook any option which could prove most cost-effective.

"Other options are frequently available for fleet managers rather than simply leasing a vehicle for a set period - and we intend to let companies know about options like ours when they literally pay-as-they-go."

• Read Fleet News (January 10) for the story on Avis's acquisition of Zipcar and what it means for the industry.

Author: Ben Rooth

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