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WLTP could prompt fleets to offer more company cars, says FleetCheck

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Company car schemes could be extended in a bid to reduce grey fleet emissions.

The arrival of the new WLTP fuel consumption and emissions standard could prompt some fleets to offer company cars to more employees, says FleetCheck.

Peter Golding, managing director at FleetCheck, said that the differences in fuel consumption and CO2 figures from some cars measured under WLTP compared to the older NEDC were marked to a degree that they demanded a radical rethink.

“We believe that this could be especially prevalent under organisations that have set themselves strong corporate social responsibility targets and are very concerned about the environmental impact of their fleet.

“The fact is that just about every company car comes out of WLTP much worse than NEDC and this will have a dramatic effect on the green results that these fleets are achieving.

“Effectively, these employers face a choice – move the goalposts because of WLTP and increase their targets or reconsider the kind of company vehicles that they are operating alongside their grey fleet arrangements.

“For these fleets, because grey vehicles tend to be older and more polluting than newer vehicles, extending the company car scheme to include more people is a potential solution, as well as one that could be cost-effective.

“Even if they don’t go for a full company car scheme, then there are further quasi-company car options such as salary sacrifice schemes and affinity personal leasing programmes, all of which offer cheap routes into newer, less polluting cars.”

He added that, while he was aware that figures indicated that the company car population continued to fall, he was aware of several companies that had recently introduced fleet cars to more employees.

“For these employers, it tends to be a question of a number of factors with duty of care leading the way – they simply find it difficult to cover off their legal responsibilities with drivers using their own, often much older vehicles.

“But environmental concerns also play a part and, if car choices can be found that minimise taxation and reduce running costs through low emissions, then these vehicles present a stronger argument for extending company car schemes.”

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  • AJ - 06/07/2018 12:05

    Hmmm... I think it's much more likely to reduce car fleets as much higher BIKs push perk drivers towards cash allowances. This feels a little bit optimistic to me.

  • Rosco7010 - 06/07/2018 12:16

    I have to disagree with this analysis. WLTP will lead to more drivers choosing cash. And more companies to offer a cash alternative. WLTP has been used by the treasury to increase company car tax under the guise of targeting emissions. So an equivalent car will be taxed up to 30% more than the previous car under NEDC. The treasury has not committed to correct this windfall, and has chosen to punish drivers of company cars, for decisions they made based on the treasury rules that existed. Whereas the tax on the car allowance has not changed at all. Either 20% or 40% of the cash amount plus employees NI. This hasn't changed for decades. What the WLTP changes have done is make the company car more expensive to the employee, and employer, and moved the breakeven point considerably higher, so only very high mileage drivers would choose a company car. Whilst WLTP will impact on environmental CO2 reporting. THis will at least be the same for all companies. The better method of reporting is to use the miles claimed, and use a formula to estimate CO2 produced. This is a more consistent measure and more accurate than using published CO2 figures, which even under WLTP are optimistic.

    • Sage & Onion - 06/07/2018 17:22

      A more consistent and accurate method of calculating co2 for reporting purposes is to measure the actual amount of fuel burnt in litres and then multiply it by the standard conversion factor to turn it into kg of co2 (1 litre of diesel burnt produces 2.6694kg of co2e). This then gives you a consistent and accurate carbon footprint in real driving conditions, and WLTP will not impact it unless we are assuming that WLTP cars will perform more efficiently than the same NEDC cars in real world conditions. But WLTP is just a measurement test suppose to reflect real world driving, so fleets that have been reporting carbon footprint based on NEDC marketing figures will see a rise with WLTP.

  • Sage & Onion - 06/07/2018 12:31

    There is also an appetite amongst company car drivers to move out of a company car because of the rising BIK costs. This is further exacerbated by HRMC's failure to publish their BIK rates past 2020/21. But also, the effect of WLTP on carbon footprint monitoring will have very little difference for those fleets that measure their actual carbon footprint from actual fuel burnt and distance travelled, rather than using published co2 figures. What has changed in the vehicle between NEDC testing and WLTP testing that is going to change the actual co2 and actual mpg that we have all been experiencing in real world driving conditions?

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