Category: Fleet News

Latest fleet news updates for fleet managers, business owners and drivers.

Image of signs reading 'petrol' and 'diesel', pointing in opposite directions

Petrol or Diesel: What’s the Best Choice for Fleet Operators?

Posted on | by Simon Pavey

It’s a question that car buyers have been asking for years: should I opt for a petrol or diesel vehicle? This is a decision that’s especially important to fleet buyers looking to keep costs low and economy high.

Of course, in today’s environment, it’s no longer an either-or choice. There are also a range of cars available that use electric power to some extent. This is only set to grow in the coming years.

However, for now, let’s focus on the more traditional options to determine which will be better for you.

Is diesel falling from favour?

The popularity of diesel vehicles has risen and fallen over the years. In the early days, they had a reputation as smoky, smelly and slow cars that sounded more like farm equipment. But this perception has altered as technology has improved and diesels have closed the gap with petrol.

The potential cost savings you could enjoy thanks to their greater fuel efficiency then led to a surge in demand. However, recent developments like the 2015 VW emissions scandal have again tainted some people’s perception of diesel.

In 2016, the number of petrol and diesel cars sold in the UK were almost identical. Some 49 per cent of sales were petrol and 47.8 per cent diesel, with electric accounting for around three per cent.

Since then, however, the popularity of diesel has fallen significantly. In 2020, just one in four new cars registered was a diesel, compared with 63.5 per cent petrol and almost 11 per cent electric. So, does this mean diesel’s time has passed? Far from it.

The pros and cons of petrol and diesel cars

Close-up photo of a man lifting a fuel nozzle from a pump.

There are still several good reasons to invest in diesel vehicles. Greater fuel efficiency is still a major benefit. These cars typically use around 15-20 per cent less fuel than petrol cars. This means lower running costs, which can offset higher initial purchase and fuel prices.

However, petrol remains cheaper than diesel. What’s more, while diesels have historically kept their resale value more than petrol, this is changing in response to shifting buyer demands and new regulations.

When it comes to the environmental factors, things are a little more complicated. In terms of carbon emissions, diesel-powered cars produce less CO2 than petrol. But while this is often used as the primary indicator of a car’s eco-friendliness, there are other factors.

For instance, diesels produce more nitrogen oxide than petrol, which also contributes to climate change. However, this can vary from vehicle to vehicle. Which?, for instance, found some diesels produce less NO2 than some petrol cars. Therefore, if your green credentials are a factor, it pays to do your research.

Cost considerations

One of the main deciding factors will be the running costs of your car. This typically means looking at fuel consumption. As noted above, diesel engines tend to be more economical than petrol – but does this offset the higher cost of fuel per litre?

The answer is that it depends on how much you use your car. Generally speaking, the more miles you do, the cheaper a diesel engine becomes in the long run. According to Which?, it can take between six and 11 years to recoup the extra fuel and purchase costs of a diesel. If you do very high mileage, however, you could start saving money faster.

But the cost of fuel is not the only consideration you’ll have to make when choosing between petrol or diesel. The type of engine you’ve got also factors into your car tax obligations.

For older cars, tax bands are based on emissions, so if you’re buying second-hand, a diesel could prove cheaper. However, for those registered since April 2017, only the first year’s ownership is taxed this way, with a standard rate applying afterward. This could greatly reduce any tax savings you may expect to make on a diesel.

Should I buy petrol or diesel cars for my fleet?

As well as fuel usage, there are other factors related to how you use your vehicle that may impact your choice. How and where you drive also makes a difference.

For example, diesel engines generally take longer to warm up than petrol engines. Therefore, if you’re doing a lot of short trips around town, petrol may be a more economical option.

On the other hand, some drivers prefer the improved low-torque performance of a diesel. Driven sensibly, a diesel will use less rpm and need fewer gear changes than a petrol engine. They also offer more pulling power, making them handy if you’re going to be towing a trailer.

You may also need to think about whether you’ll be driving in low emission zones. London already has an ultra-low emission zone for cars, and several other cities are set to follow suit in the coming years.

If you have older diesel vehicles – especially those that don’t meet Euro 6 emissions standards – you could therefore end up paying a lot of money to drive in these areas.

What about electric options?

Plug-in electric car being charged at on-street charging point

While petrol or diesel is still the main choice for many buyers, you may want to look to the future. In this case, you’ll have to consider whether a full electric or hybrid car will be worthwhile. Indeed, with the government going ahead with plans to ensure all new cars sold are electric by 2030, this will become a necessity in the coming years.

There are three main choices available for electric cars. These are:

  • Conventional hybrid – A combustion engine supported by an electric motor. The electric motor does not need plugging in, and is charged as the car moves, usually by recovering energy from the braking system.
  • Plug-in hybrid (PHEV) – A combustion engine supported by an electric motor, which can be charged via an external power source. The electric motor is typically used at lower speeds, with the petrol or diesel engine taking over when more power is required.
  • Full electric – No petrol motor at all.

When compared to petrol or diesel cars, the main advantages are much lower emissions and reduced fuel costs.

Each has its pros and cons. A conventional hybrid is the cheapest and least complex, but can only use a limited amount of electric power. This means you don’t see as many cost savings as a PHEV or full electric.

For fully electric cars, you would also have to factor in range. Battery technology is improving all the time, with some cars now able to go hundreds of miles per charge, but the charging infrastructure still has some way to go.

As you can’t simply pull into a fuel station and fill up in five minutes, more careful route planning may be required for long journeys. However, for shorter trips where you can recharge regularly, this shouldn’t be an issue.

Choosing the best engine type for your fleet can save you huge amounts of money in the long run, especially when combined with the right fuel card. Contact our experts today to find out which would be best-suited to your needs.

fuel nozzle inserted into car at petrol station

Advisory fuel rates explained

Posted on | by Simon Pavey

For drivers operating within a commercial fleet, refuelling at petrol stations while on the job is an absolute necessity. The cost associated with refuelling, however, is not universal when comparing routes like-for-like.

That’s because there are many external factors that could affect the cost of refuelling, including the type of engine a company car uses, as well as its fuel efficiency. Should, then, the driver be solely responsible for covering the cost of petrol, despite having no control over the specifications of the company car they’re given?

The government believe not, which is why they help businesses determine how to fairly reimburse employees who drive for commercial purposes – by publishing advisory fuel rates that set out an approximate cost of fuel based on car efficiency. In this article, we’ll explain how these advisory fuel rates work, and what to look out for if you’re a fleet operator.

What are advisory fuel rates?

Advisory Fuel Rates (AFRs) are set by the government each quarter. They’re designed to give businesses a reasonable estimate of how much drivers should be paying for fuel, accounting for how many miles per gallon a vehicle should be able to cover (on average) based on its engine size.

AFRs help to ensure that drivers are fairly reimbursed for any miles they travel for business purposes, whether that entails operating HGVs or city taxis. They have two main applications:

  1.  Serving as a guideline for fuel costs to make it easier to reimburse employees for any miles travelled for business purposes.
  2. If businesses pay all of employees’ travel costs, then AFRs can help to calculate how much drivers need to repay for any fuel used for private travel.

These are the only instances in which AFRs are applicable.

How HMRC calculate advisory fuel rates

Calculating the precise rate of fuel consumption for every company car used in the UK simply isn’t feasible at scale, and so HMRC devised a system for calculating AFRs that takes into account:

  • Engine size.
  • Miles per gallon – using an average based on manufacturer’s guidelines.
  • Fuel prices – based on the Department for Business, Energy, and Industrial Strategy recommendations.

Fuel prices are, therefore, estimated, and rounded to the nearest penny.

The ideology underpinning AFRs is to ensure that drivers pay a fair price for commercial fuel in the long run. It’s crucial to acknowledge, then, that these rates are ‘advisory’. If your fleet cars are more fuel efficient than the advisory rates, then you could be exempt from fuel benefit charge.

Conversely, if your drivers are having to pay higher than the AFRs for commercial fuel, the difference is as taxable profit and classed as earnings under Class 1 National Insurance rules.

Advisory fuel rates in 2022

It’s crucial to always check the latest government guidelines to find out which advisory fuel rates currently apply. As of January 2022, the advisory fuel rates were as follows:

Engine Size Petrol – rate per mile LPG – rate per mile
1600cc or less 13 pence 9 pence
1601cc to 2000cc 15 pence 10 pence
Over 2000cc 22 pence 15 pence
Engine Size Diesel – rate per mile
1600cc or less 11 pence
1601cc to 2000cc 13 pence
Over 2000cc 16 pence

These rates change frequently, and are reviewed four times per year by HMRC, on the first day of March, June, September, and December.

Fully electric cars are comparatively cheaper to run than petrol, diesel, or LPG equivalents, and are consequently cheaper – at 5 pence per mile. Hybrid cars, however, are treated as petrol or diesel cars when calculating AFR.

Petrol station attendant filling up car

What do advisory fuel rates mean for businesses?

Now that we’ve covered what AFRs are, here are our tips on how you can manage them as a fleet operator.

Accurately log all business mileage

Crucial to calculating the exact price of fuel your drivers are paying is understanding precisely how many miles they are covering. In the modern world, the most practical way of achieving this is through digital technology.

For example, at Fuel Card Services we offer an all-in-one software product called MileageCount which automatically records each mile travelled by your drivers and reports to a centralised database; making it easy to generate accurate mileage records for all fleet vehicles.

Beyond saving you time on admin and money on mileage claims, this software could empower you to make calculations around how much to reimburse your drivers for fuel, with a high degree of accuracy. Failing to do so could result in HMRC imposing car fuel benefit at a later date when your business is audited.

Be clear on how company car petrol is paid for

Having a legitimate and well-thought-out process for ensuring drivers are adequately compensated for fuel costs is crucial. However, communicating your process to drivers and ensuring they can get to grips with it at a glance is also a must for businesses.

It may therefore be wise to review how you communicate your stance on AFRs and your internal processes to drivers. Should you be publishing a policy on your website, are you providing written documentation on your company policies, and do drivers understand your policies?

Regardless of whether your business model involves retrospectively reimbursing drivers for fuel, or paying all travel costs up front and claiming money back from your workforce, having clear communication around how the system works is crucial. It may affect recruitment, as prospective employees may appreciate transparency and clarity from your business’ end.

We hope this article has helped shine a light on why advisory fuel rates matter and explain how they work. One final note from us is that these rates do not apply if drivers are using their own vehicles to drive on behalf of a company, so it’s worth assessing how exactly AFRs fit into your business model.

How can Fuel Card Services help?

At Fuel Card Services, we specialise in helping businesses save money on their fuel costs. On the one hand, a fuel card from our range of branded cards could make a real impact to your bottom line for every mile driven by your team.

On the other, our MileageCount software and advanced telematics service can be used to properly track your driver’s routes, and plan routes efficiently. Calculating advisory fuel rates could therefore become a breeze with the right technology in place.

If you’re interested in taking your fleet operation to the next level, our Tele-Gence technology can give drivers access to live traffic updates that make route planning more efficient and give you insights into their driving habits to help become more efficient with fuel consumption.

Tele-Gence also synchronises seamlessly with your fuel card account, making them the perfect pairing for keeping your fuel costs and consumption as low as possible. If you think your fleet could benefit from these services, get in touch today and see how we could help you.

Judging stopping distance while driving on icy roads

Car stopping distances explained

Posted on | by Simon Pavey

It’s amazing what commercial vehicles enable for UK businesses. Whether we consider HGVs transporting raw materials to enable the manufacturing of complex goods, or a taxi rank helping people reach urgent meetings and appointments on time – there’s virtually an infinite number of ways in which automobiles empower businesses to create, operate and interact.

Crucial to the usage of commercial vehicles, though, is the practice of upholding proper safety standards. After all, there’s a very real and immediate danger involved when cars are driving along a road, given it’s difficult for them to stop quickly while travelling at high speeds.

So, in this article, we’re going to explain car stopping distances and look at how commercial fleet operators can improve driver safety. In doing so, we hope to help fleets equip drivers with correct, practical, and up-to-date information.

What is stopping distance?

Stopping distance is simply the time taken for a vehicle to transition from a state of moving to being at a complete stop. Understanding the physics of a car is one of the first things one learns as a beginner driver, and it’s applied every time you gently break to pause at traffic lights.

More commonly, though, we use the term stopping distance to describe the exact time needed to stop a vehicle in an emergency situation. This could be brought about, for example, by a pedestrian suddenly running out into the road, or a traffic accident. Drivers should know their stopping distances at all times to maximise safety both for themselves and those around them.

It’s also important to be aware of thinking distance. Naturally, a driver must first perceive whatever road hazard they’re facing, process it, and then choose to hit the brakes – and this is an important part of the stopping distance formula. Ideally, drivers will allow themselves adequate ‘thinking distance’ by putting distance between themselves and other drivers, and abiding by the speed limit.

How to calculate stopping distance

How, then, can stopping distance be calculated? Unfortunately, there’s no simple formula to work this out. The main components involved are to:

  1. Gauge stopping distance based on your vehicle’s speed, weight, and size. Check out our rough guide.
  2. Factor in the condition of brakes and tyres.
  3. Take into account road and weather conditions.
  4. Factor in the driver’s alertness.

Exact stopping distance will always vary from vehicle to vehicle, and stopping distance itself comprises thinking distances and braking distance elements. General stopping distances, however, are a part of modern driving theory tests and should be known by all drivers.

This is especially true for drivers of commercial fleets, and commercial fleet operators may do well to ensure firstly that drivers have an accurate understanding of stopping distances based on the vehicles they’re using (which may vary drastically for vehicles carrying heavy loads), and have the right tyres and brake technology to improve stopping distances.

Interior view of vehicle driving on motorway

Factors affecting stopping distance

In terms of closing any knowledge gaps, it’s also important to understand how the following factors can impact stopping distances.

Stopping distance in ice

Ice on the roads can function in a comparable way to low tyre tread; reducing the car’s grip on the road and limiting the control drivers have over their vehicles. This can seriously impact the delivery time on commercial routes, and so our tip for fleet operators would be to encourage drivers to plan their routes around roads that are likely to be well gritted and safe in the face of challenging winter driving conditions.

How much can stopping distance increase in ice?

It’s estimated that icy roads could increase a vehicle’s stopping distance by up to ten times their non-icy equivalents. What this means in real terms is that if you are driving at 70mph (with a standard stopping distance of around 96 meters), it could take you almost a full kilometre to fully slow your car down to a stop. In that time, over half a mile of travel, there is a high risk of control being lost or the vehicle colliding with other travellers on the road.

Fleet drivers should be encouraged to drive with the highest level of caution if roads are icy, and depending on the severity of such conditions, unnecessary journeys should not be carried out.

Our tip for fleet managers: Develop a framework for route planning in icy conditions, as opting for better travelled, busier, and slightly slower routes that improve safety may be more financially savvy in the long run than taking risks with quick, icier roads that could result in damages.

Stopping distance in rain

Rain can impact a driver’s thinking distance by reducing visibility, thereby making it harder to spot and acknowledge hazards on the road. Poor visibility can of course be countered, to some extent, with wiper blades. But realistically, it’s very difficult to plan routes around the rain as weather can change quickly.

Consequently, fleet operators may do well to take weather conditions properly into account when assessing how efficiently drivers are planning routes – as having drivers feel pressured to rush in dangerous conditions can not only have an impact on mental health, but potentially pose a threat to physical health too.

How does rain affect stopping distance?

Stopping distance approximately doubles in rainy conditions, which means that a car travelling at 70mph can expect to travel around 180 meters before coming to a stop. This is a significant change in stopping distance, and to accommodate such a change fleet drivers should be reminded to stay alert, keep adequate space between themselves and the vehicles in front, and to maintain a safe and legal speed.

Tyres and brakes

The quality of a car’s tyres and brakes can drastically affect its stopping distances. Naturally, as tyre technology evolves each year, driver safety improves – and any tyres that are upward of ten years old (including spares) should be replaced immediately.

Similarly, brake pads wear down over time, and so it’s important that drivers can spot the warning signs that this may be an issue, which can include:

  • Dashboard warning lights
  • Screeching sounds
  • Grinding

Drivers could also manually check that there’s adequate brake pad remaining – with anything less than a quarter of an inch potentially proving dangerous. With tyres and brakes, it’s crucial that drivers are both aware of and adhere to legal safety limits.

Stopping distances at different speeds

We’ve already covered how different road conditions can affect braking distance, and it’s also worth considering that drivers could have a diminished thinking distance if, for example, they are suffering from fatigue or tiredness. As a rough guide, however, in perfect conditions you may find that stopping distances are roughly as follows for a medium to large-sized car with quality tyres.

Stopping Distance In Feet In Metres
Stopping distance at 70mph 315ft 96m
Stopping distance at 60mph 240ft 73m
Stopping distance at 50mph 175ft 53m
Stopping distance at 40mph 118ft 36m
Stopping distance at 30mph 75ft 23m
Stopping distance at 20mph 40ft 12m

This is based on guidance from the Highway Code, using an average vehicle length of four metres. It isn’t, however, a one-fits-all solution that can tell you the stopping distance of any vehicle, and drivers should take the external factors we’ve covered into account, as well as the weight of their load.

How to improve stopping distance

We hope this article has helped to shine a light on the importance of driver safety. Some action points to take away for commercial fleets could include:

  • Checking that your drivers have up-to-date knowledge around stopping distances, and providing them with any fresh information published by reputable authorities.
  • Auditing your fleet to ensure not only that cars are able to pass their MOTs, but that brake and tyre technology is ‘good’ rather than ‘adequate,’ which could make working for your business a more attractive prospect for job hunters.
  • Talk about driver safety internally, and equip your drivers with the right route-planning technology to make journeys safe and cost-effective.

Car Length Stopping Distance

A good way to visualise just how far car stopping distance is to consider how many average car lengths it will take a vehicle to stop at various speeds. For example, for a car travelling at 20mph you can expect a stopping distance of three car lengths. This distance quickly jumps up and the stopping distance of a car travelling at 70mph will take 24 car lengths to come to a complete stop.

How to improve stopping distance

We hope this article has helped to shine a light on the importance of driver safety. Some action points to take away for commercial fleets could include:

  • Checking that your drivers have up-to-date knowledge around stopping distances, and providing them with any fresh information published by reputable authorities.
  • Auditing your fleet to ensure not only that cars are able to pass their MOTs, but that brake and tyre technology is ‘good’ rather than ‘adequate,’ which could make working for your business a more attractive prospect for job hunters.
  • Talk about driver safety internally, and equip your drivers with the right route-planning technology to make journeys safe and cost-effective.

How can Fuel Card Services help?

At Fuel Card Services, we take driver safety seriously. That’s why we offer a range of commercial fleet services that are designed to improve driver safety and provide cost savings. Services include:

  • Tele-Gence; a smart telematics system that’s tailored to your business’ unique needs. This software can improve safety for your drivers and security for your vehicles.
  • MyDriveSafe.Expert – which allows drivers to carry out vehicle checks on their mobile phones. This data then feeds back into a manager’s portal, enabling you to check that vehicles are safe to drive and that legal requirements are met.
  • MyService.Expert – we offer an online, pay-as-you-go system that gives you access to pre-negotiated repair and maintenance rates at thousands of UK garages, meaning any faults can be resolved quickly without breaking the bank.
Close up of front of white car

A Guide to Car Running Costs

Posted on | by Simon Pavey

Apart from capital costs, fleet managers need to consider the operational costs of running commercial fleets. These costs are a result of the day-to-day car activity, it’s important to have an understanding of what they are and how you can better manage them by cutting unnecessary expenses.

This guide will cover:

Fleet fuel

Fuel cost is a big part of running a fleet. The cost can vary depending on a range of factors such as mileage, fuel type, having the right type and size of the fleet for the task, and tyre conditions.

There are various ways to reduce fuel costs:

  • Starting off with calculating how much each mile is costing you. Once you understand the mileage cost, looking at deals that offer cheaper fuel can massively reduce costs. Fuel Cards are a great option as we work with every major fuel brand to offer competitive discounts across petrol stations nationwide.
  • Consider using electric vehicles. They are not only environmentally friendly as they reduce emissions, but also great for reducing costs as there will be no need to pay for diesel or petrol.
  • Review whether you’re using the right type and sized vehicle for the job you’re carrying out. For example, if your fleet is carrying only a small quantity of products, then a small car would be enough. However, if you’re carrying heavy goods then a van or truck would be a better option.
  • Underinflated tyres can increase fuel consumption by 15%. Ensure your tyres have the right pressure, this will also help decrease fuel consumption.

Fleet maintenance costs

The second largest expenditure that fleet managers incur is maintenance, service and repair. The rate at which you carry out repairs and service of your fleets will affect your cost of ownership or monthly leasing payments if you are renting your vehicles.

Often, this can be a hard area to manage as maintenance work can be unexpected. However, there are is software such as MyService.Expert that can be used to monitor all servicing and repair work with price guarantees, service level agreements and KPIs for suppliers. This will give you full visibility and control over your fleet operation management and reduce fleet downtime by ensuring all vehicles are in their best condition.

There is also a simple way to reduce and manage your maintenance cost, by opting for packages offered by fleet management or leasing companies. These packages include servicing, repair and general wear and tear, allowing you to manage your overall business operations in an efficient way.

Fleet insurance

Over time, your insurance costs could increase due to accident or damage, especially if you haven’t set a minimum drivers standard. It’s highly important to do a risk assessment to analyse your claim history to check what types of accidents are occurring, how often and any common causes.

This will allow you to train your drivers on their weak points and enforce a minimum standard of driving, whether that involves online safety training or in-car training. The less accidents the lower your insurance costs.

When hiring drivers, carry out thorough checks and ensure they don’t have any points on their driving licence. The more points on their licence, the higher the insurance premiums. So, hiring drivers that have a clean driving licence and are safe road users is extremely preferable for both the safety of road users and for reducing costs.

You can use fleet management software such as Tele-Gence to store and analyse all the data for easier analysis and understanding. This is a tracking system that automatically stores data, reduces costs and offers improved safety to drivers by setting geographic alerts based on defined parameters, setting up crash detection alerts to inform a chosen contact, and monitoring dangerous speeding.

Always review your insurance before renewing as you may be able to get better deals with new insurers. Gathering information to show them that you are taking all the necessary steps to increase safety measures and reduce accident rates may also help you negotiate your insurance rate.

Adding new vehicles can also affect your premium rate, so before committing to a vehicle, check whether it would be viable and not increase your current insurance premiums.

Row of parked cars

Fleet tax

Apart from road tax and vehicle tax, fleet companies need to pay Benefit in Kind, National Insurance and costs related to how much CO2 emissions the car produces. These taxes are:

  • Class 1A National Insurance: this is worked out as the car’s P11D price, combined with the relevant CO2 emissions band.
  • Vehicle Excise Duty: all UK vehicles must pay this tax. This is linked to how much emissions a car produces.
  • Benefit in Kind: this only applies to fleet operators that also personally use the company vehicles. However, fleet operators that do not use the vehicles for personal use, will not have to pay any BiK tax.

The good news is that fleet operators are able to reclaim 100% of the VAT if their vehicles are solely used for business purposes. Lease costs are also 100% deductible unless CO2 rating is over the LRR household, in which case only 85% is deductible.

An easier way to reduce taxation cost is through EV vehicles, due to them not producing CO2 emissions, you won’t have to pay National Insurance or Benefit in Kind.

Fleet licence and permits

Fleet operators that carry goods on a van or truck with a gross weight of over 3,500 kilograms or unladen weight of more than 1,525 kilograms, need a Goods Vehicle Operator’s Licence.

Taxi fleets also need to have licences depending on the number of vehicles they operate. There are two types of Taxi Operator Licence (TOL):

  • Small operator TOL: only two vehicles can be operated at any one time.
  • Large operator TOL: there are no restrictions on the number of taxis that can be operated at any one time.

How can Fuel Card Services help?

At Fuel Card Services, we specialise in fleet maintenance and have developed a full suite of tools that you can use to become more cost-effective in your operations. Every good fleet management operation requires a desire to both protect drivers and profits, the right people in place, and the right technology to make an efficient operation possible.

To see how we can support you with the right technology, including advanced telematics, view our range of fleet services today, and get in touch with one of our friendly experts for a tailored quote.

Salesman handing keys to driver in vehicle

Make the most of rental vehicles

Posted on | by Simon Pavey

Businesses might choose to lease their vehicles rather than purchasing them as it can have many financial benefits. How can businesses ensure they are doing their best to save money under this arrangement?

What are the benefits of renting vehicles?

For some businesses, the financial benefits of a rental vehicle can seem attractive. Businesses will obviously have to pay less upfront, making leasing a promising prospect for small businesses who may not have the money to splash out on an entire fleet.

With a full service lease, the expenses of having these vehicles become very predictable. Hefty maintenance and insurance fees won’t catch fleet managers out, as these costs are included in the plan.

The final monetary benefit of leasing is that businesses don’t need to be concerned about depreciation.

Understanding the contract

Despite the many financial benefits of vehicle leasing, it is vital that fleet managers understand how to make the most out of this arrangement.

When you agree to rent a vehicle from a provider, you are entering into a contract. It is paramount that you understand the ins and outs of the contract so you don’t come across any unexpected costs.

Will you be charged for delivery and collection? How many miles are you permitted to drive? What would the implications be if the vehicle was damaged or stolen?

Not knowing the answers to these questions could be seriously detrimental in the future. Additionally, make sure your drivers know the terms of the contract too, so everyone involved can be held accountable.

You also need to understand what condition the vehicle should be in when it is returned to the supplier. You can assume it must be cleaned properly before it goes back, but different suppliers may have differing rules regarding things such as fuel and fluid levels.

Set an end date

On that note, it’s hugely beneficial to agree a date on which the vehicle will be returned to the provider. Leaving it open ended can mean that your drivers will keep the vehicle far longer than necessary, and your business will be charged for this. Since business owners might not even see the vehicle, this extra layer of security is important.

If your driver keeps the vehicle longer than the contract allows, your business will be charged for this, but you can be certain it was the driver at fault. If you leave the contract open ended, you can’t extract compensation from the driver on the grounds that they kept the vehicle for longer than necessary, as no such time was determined in the first place.

Plan ahead

Booking last minute tends to be more expensive. Getting a rental vehicle organised in advance further exaggerates the financial benefits of leasing.

Additionally, you might find that you can’t find the right vehicle if you leave it too late! The global shortage of parts such as valuable semi-conductors means that vehicle production across the globe has slowed. As a result, you might find that suppliers of rental vehicles don’t have a surplus of cars or vans.

This is especially important if you know your drivers will be going through a low emissions zone such as the one in London. You’ll need to get your hands on an electric vehicle if you don’t want to be hit with extra charges. Since electric vehicles are set to be an increasingly popular choice over the next decade, you can expect competition when it comes to renting one. Get it booked in before your competitors do!

Salesperson handing over keys

Could a rental fleet replace your grey fleet?

Many businesses choose to run a grey fleet as a way of saving money. Much like leasing, they negate the need to purchase new vehicles, so can it work out cheaper in the long run.

However, grey fleets do cause some legal complications. Your drivers need to have the correct insurance, and they can claim money for having to use their own vehicles.

If you run a fleet of rental vehicles, however, you don’t need to worry about any of this! All legal considerations will be covered in the contract with the vehicle supplier. You’d be getting financial benefits of not having to purchase business vehicles, whilst maintaining a level of security and confidence.

How can Fuel Card Services help?

So you’re running a fleet of leased vehicles, and you’re saving money as a result – but could you go further?
Consider supplying your drivers with a branded fuel card. You could save up to 10p per litre on fuel costs, and also reducing your admin time with HMRC approved invoices.

Much like renting fleet vehicles, a fuel card can keep your long term costs low, meaning you have more to spend on the development and expansion of your business.

Get in touch today, and see what Fuel Card Services could do for you!