Two decisions taken by BCA fleet manager Marie Jarrold within the past seven months could end up saving the company more than £700,000.

The first, a move to longer replacement cycles, echoes a popular trend among fleets which lease their vehicles. For BCA, which outright purchases its vehicle fleet, the action brings an immediate benefit to the bottom line.

BCA’s policy changed in October from four years/80,000 miles to four-and-a-half years/90,000 miles. The company, which spends £1.2 million a year replacing 100-120 vehicles, estimates a one-off saving of £641,000 by deferring financial outlay.

There is a cost to extending replacement cycles: maintenance bills will rise and the re-sale value will fall slightly. However, BCA estimates the impact to be minimal, worth £200-300 per vehicle on higher service costs.

“Driver loan contracts have under HMRC rules been extended and vehicle valuations have been reviewed and revised on future CAP residual value and driver mileage expectations,” says Jarrold.

The revision hasn’t been without its hiccups, largely due to BCA’s fleet policy of buying used cars up to one year old and 15,000 miles. It means some cars will return to market aged more than five years old. CAP, though, only provides residual data up to four years.

During discussions with CAP, Jarrold discovered that other fleets were also requesting valuations at 54 months and beyond. She is currently averaging the residual forecasting between 48 and 60 months while CAP works to extend its RV model.

In January, Jarrold introduced her second cost saving measure, a two-pronged efficiency drive which capped cars at 160g/km and set a minimum combined fuel consumption of 40mpg.

Lowering the average emissions – the target is a 10% reduction over the next 4.5 years - is expected to save the company between £4,000 and £39,000 on road fund licence, depending on vehicle choice. It will also shave £18,000 off the annual fuel bill.

Setting a minimum fuel consumption of 40mpg will lop another £xxx off the fuel bill every year, estimates BCA.

The remarketing company’s 340 company car drivers now select from a seven-band options list based on engine size and value.

Prior to the policy changes, BCA was already running one of the most cost-efficient fleets thanks to its policy of purchasing only used cars. Almost all the cars are sourced internally, at one of BCA’s auctions.

The savings are considerable and raise the question about why more fleets don’t consider a used car fleet policy.

“You need the market knowledge and we have that with Nigel Everitt, general manager of vehicle procurement,” says Jarrold. “But when you evaluate the benefits of contract hire versus outright purchase and look at the advantages of buying a used car, I can’t see why other companies don’t consider this option.”

As an example, Jarrold points to a recent purchase of a Saab 9-5 with a list price of £26,000. She acquired it as an eight-month-old car for just £16,000.

“We wouldn’t have such a broad spread of cars if we had a new car policy – we’d need to be dual or solus badge to get such a good deal,” she adds.

The downside is having to wait until new models, such as the Vauxhall Insignia or Honda Insight, become available on the used market. As a result, BCA’s fleet will never be in the vanguard when it comes to adopting the latest high efficient models or alternative fuel vehicles.

Under its car ownership scheme, BCA buys the car and the driver pays a fixed payment each month based on the wholelife cost. BCA considers it a grey fleet because the driver is paying directly for the car; it’s not classed as a benefit-in-kind.

At the end of the contract term they have the option of buying the car outright at the loan balance, although few do (last year, just six out of a possible 120 did). The rest are remarketed through one of BCA’s 21 auction centres.

In total, Jarrold oversees 398 vehicles, including 20 pool cars, several utility vehicles, two fire engines for the airstrip adjacent to the Blackbushe auction centre in Surrey, motorcycles, JCB digger and road sweepers.

Managing the fleet was made easiest last year after BCA implemented Jaama’s Key2 software. It included a bespoke reporting function to detail maintenance costs for every vehicle.

“It has shown me which vehicles are potentially more cost effective to have on our fleet,” Jarrold says.

After five years as BCA’s car fleet controller, during which she has won two Fleet News awards, Jarrold continues to build her knowledge via the Institute of Car Fleet Management. She is close to completing the ICFM’s diploma in fleet management after earlier passing its introductory certificate of car fleet management with distinction.

“The diploma helps to give me a wider view of fleet management,” she says. “I meet peers and colleagues on the course which gives me an insight into how their fleets work. I keep in touch with them now to discuss problems and solutions.”

Jarrold adds: “Everyone comes into fleet management in a strange way, such as HR or PA – no-one really wants the role, it’s not seen as a career move. But once you’re in, you realise it’s so diverse – no two days are the same. It’s not just car management, it’s people management, and there’s always a fresh challenge.”

Company facts

Name: BCA
Business: Vehicle remarketing
Car fleet controller: Marie Jarrold
Fleet size: 398 (including 340 company cars, 20 pool cars, motorcycles, road sweepers and two fire engines)
Funding policy: Outright purchase of used cars up to one year old/15,000 miles
Replacement policy: 4.5 years/90,000 driven miles

Marie Jarrold has a number of projects on the go this year, among them fuel, accidents and rental.

Fuel

BCA has around 500 fuel cards for its transport division and is looking to educate drivers on their behaviour to reduce the fuel bill. Jarrold frequently reminds drivers to buy fuel at supermarkets and is monitoring usage via the Jaama system. She is considering alternative providers, bunkering fuel and negotiating greater savings from fuel card provider Arval.

Accidents

Although BCA has a low accident rate of around 10%, its insurance excess is £1,000 so any damage is usually funded in-house. Under consideration is charging drivers for repairs on common incidents like reversing. “It’s all about driver awareness – and it’s not the drivers that are on the road most of the time that have the highest incident rates,” Jarrold says.

Rental

Jarrold has already reduced the number of rental booking each year several hundred to around 50 this year. She is utilising BCA’s own vehicle fleet, including pool cars and reallocated cars from leavers, to more than halve spend to around £20,000. Every rental car has to be approved by me – it has to be justified,” she says. Bookings are limited to 1.4-litre models.