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No news is good news?
While the Budget can bring about opportunity for fleets through the introduction/continuation of incentives, it can bring more bad news than good and is often a catalyst for change, especially with regards to the company car market.
Many may be relieved to have a non-eventful budget following a turbulent few years for the sector, however the huge question around Company Car Tax remains.
We’ve picked out a couple of the key headline topics and written a brief summary on what it means for fleet:
A review on the impact of WLTP on Vehicle Excise Duty and Company Car Tax will be reported in Spring 2019
While it is disappointing that the government has failed to give fleets the essential clarity needed on Company Car Tax rates, perhaps this only further demonstrates the essential need for a flexible approach to fleet in businesses and ultimately a change in thinking with regards to the traditional company car scheme.
For years many fleets have adopted a ‘one-size-fits-all’ approach with regards to fleet funding, and during times of market imbalance and uncertainty, this approach can be damaging to fleet finances. Although employees will find themselves in the same job role as their peers within a business, very seldom if at all, are their requirements the same and businesses will feel the monetary pressure for employing such a generic method of procurement.
By utilising multiple funding methods side-by-side, fleets obtain the required flexibility to utilise a funding method that best-suits the needs of the individual selecting the car, which changes dependant on the employee’s lifestyle, mileage profile and individual taxation position.
Adopting a blended funding approach means that fleets are much less susceptible to market changes, and such an approach typically delivers significant savings for both employer and employee.
How can we help? Our experienced corporate fleet team can assess the benefits and suitability of implementing blended funding within your organisation via a consultancy-focused review. Hitachi Capital can analyse how your fleet works currently, assessing your employee and mission critical demographic to provide a solution that reflects your business and optimises the fleet to work for you.
New VED rates for Vans will be introduced in April 2021, following a review from HMRC. The new system will take into account the weight of the van, and seek to incentivise the uptake of low emission/alternatively fuelled vans.
It will be interesting to learn the outcome of this review, which may well be announced after September 2019, the deadline for re-testing of all LCVs under WLTP.
The nod towards taking into account the weight of the van could potentially bring added complexity for the sector from a vehicle compliance perspective.
It is likely that the new VED rates would impact new vehicles registered after the date of introduction, therefore for now fleets do not need to necessarily concern themselves with this announcement however TCO-based vehicle selection is critical and with the growing likelihood of major cities implementing Clean Air Zones, it is essential that fleets seek to accelerate the move to Euro 6 diesel to avoid increased costs.
How can we help? Our fleet consultancy team are able to conduct a detailed review of LCV impact of Clean Air Zones, whilst also designing a strategy to accelerate move to EU6 and alternative fuelled LCVs.
Every business is different with unique missions and objectives which means that the way your fleet works will differ even to companies in the same industry.
There has been and will continue to be, a lot of change in the marketplace, however this creates a great opportunity to enable companies to review their fleet policy. Now is the time to take a more precise view of the workings of your fleet to future proof it and the company for many years to come.
We have vast experience in conducting detailed proof of concepts that incorporates every aspect of your business and fleet alike to create a new tailored scheme that will aid you financially as well and improve employee engagement. We are able to undertake this work in partnership with your business to ensure your fleet is helping you attain your company’s objectives, while staying true to the values and mission of the organisation.
For more information or to arrange a review of your fleet click here