Sam Sterry, head of SME, Europcar Mobility Group UK, on the hidden costs of employees using their own vehicles
Grey fleet cars, defined as vehicles owned by employees that are used for business purposes, are something that most businesses tend to rely on for some of their employee travel. But, on average eight years old, they are at a higher risk of breaking down and less reliable than newer models.
Grey fleet can put a strain on SMEs and public sector organisations for a number of reasons. First, there is the unexpected costs of providing a replacement vehicle or paying for transport when an employee’s own car breaks down. Plus the potential lost revenue of employees missing appointments or meetings.
It is also hard for employers to collect data about employees’ own vehicles, leaving them in the dark as to whether a vehicle has a valid MOT, tax, insurance, when it was last serviced and if it is fully road-worthy. there’s also the additional administrative burden of keeping track of expenses with claiming business mileage.
But most significant is the duty of care risk of grey fleet usage. If a driver is involved in an accident while driving a grey fleet vehicle for work the risk for the employer could be considerable. Where there is evidence of failings under the Duty of Care Act or the Corporate Manslaughter Act, employers (including senior employees) could find themselves facing prosecution which may result in hefty fines or even prison sentences.
Figures from the Energy Saving Trust (EST), in partnership with the British Vehicle Leasing and Rental Association (BVRLA), revealed there are 14 million grey fleet cars on UK roads, driving approximately 12 billion business miles each year on UK roads. Because grey fleet vehicles are older they use more fuel and higher emissions, the report states that grey fleet vehicles cost the private sector almost £5 billion and emit 3.2m tonnes of CO2 and 7,038 tonnes of NOx which could impact on the company’s environmental objectives.
Committing to the acquisition of vehicles is financially unrealistic for many businesses, but businesses can consider long-term rental vehicles as a genuine alternative, among other mobility solutions.