Wholelife costs are key to obtaining value from a fleet

The Fleet Insight Theatre for Finance at Fleet Management Live put the focus on wholelife costs and how they are key to obtaining best value from a fleet.

Jo Hammonds, fleet manager at Mears Group (pictured), said: “Wholelife costs can sway the way you look at a vehicle. The best value is derived from all things considered. The cheapest vehicle is not always the best.”

He recommended that fleets look at fuel economy, depreciation, tax and servicing costs when considering vehicles as often a slightly higher list price will balance against cheaper running costs.

Hammonds also warned of the importance of getting your fleet policy right before looking at vehicles. He said once a fleet knows its strategy it can start trying to leverage discounts with suppliers and working out which vehicles will be the most efficient.

Delegates were told by David Rawlings, director of BCF Wessex consultants, that company cars still provide great value to employees and despite the threat of imminent tax rises. He said both the employee and employer can benefit from a value focussed fleet.

Rawlings also said that running a good cash-allowance fleet is a lot more difficult than a company car fleet.

“Keep it simple, if you try and suck every penny from your fleet you will end up replacing it with admin,” he concluded.

Matthew Walters, head of consultancy at LeasePlan, also spoke. He agreed with Hammonds that whole life costs should be the new focus for fleet operators, calling it “the next logical step.”

The proposed changes to benefit-in-kind taxation were also raised by Walters. “All tax free benefits are at risk," he said.

Addressing cash allowance in lieu of a company car is part of the Governments focus, according to Walters. He went on to state that company car tax is already well established and works, so LeasePlan believes it should be left alone.

“The proposals are difficult to implement and create an administrative burden, but from the calculations we have made the changes will only provide a short term gain,” he added.