corporate car-sharing

All you need to know about corporate car-sharing

By Craig Thomas on Mar 31, 2017

The mobility market is on the cusp of a huge change over the coming decades, with the entire premise of car ownership likely to change to more of a car-sharing model.

These changes won’t just affect consumers, the fleet market will also change, as fleet managers continue to find ways of reducing their operating costs.

Switching from owning or leasing fleet vehicles to introducing a corporate car-sharing scheme has the potential to affect a paradigm shift in how companies and their employees use vehicles for work journeys, with numerous benefits available to them – and society at large.

Perhaps the most pressing issue for most fleet managers is reducing costs, which is an area in which car-sharing can make a significant contribution.

The most obvious benefit is the ability to reduce the size of the fleet, cutting down on the costs of leasing vehicles. Employees won’t have their own vehicle, but they will still have access to vehicles. For some employees, a cultural shift in how they think about company cars will be required, but these corporate drivers may be won over by having access to a range of new and varied makes and model.

Some trial and error might be required in the early days of car-sharing schemes, but once established, managers could find themselves with fleets that are drastically reduced in size. Some organisations that have embarked on car-sharing have found they can even halve the size of their fleet [1].

A car-sharing scheme would also save on the costs of grey fleet usage. Grey fleets – cars privately owned by employees and used for company business, with the employee reimbursed for mileage costs as a cash allowance – cost fleets £5.5bn a year. Switching employees into shared or pool cars would be an instant saving.

Car-sharing also benefits a fleet manager in providing greater insight into the transport needs of the company and its employees. Vehicles will be equipped with telematics systems that are not only used to arrange bookings and unlock the car, but also to track the vehicle while it is being used. Fleet managers will be able to learn a great deal from the data about how employees drive, how vehicles are used and the journeys made on company business.

You will have a number of options if you decide to introduce sharing schemes.

First, you can set up your own car club, along the same lines as those consumers are increasingly joining in the UK’s cities. Employees who need to use a vehicle as part of their job function sign up to the club and are issued with a personal smart card that enables them to access the vehicles (keys are kept onboard, along with a fuel card for refuelling the car).

When they need to use a car, they can book one, in the same way that staff book a meeting room, using either an app on their phones or via their computer.

Alternatively, you can also buy in a packaged scheme from providers such as leasing company Alphabet, which offers a self-managing scheme called AlphaCity to fleet users.

The other option is to open a corporate account with one of the many car clubs now operating in the UK, such as Zipcar (owned by Avis), Enterprise Car Club, Europcar’s E-car Club or Hertz’s car club service. There are also a number of community-based car clubs that companies could support, which has the additional benefit of demonstrating good corporate citizenship.

Vehicle sharing is a trend that is only going to increase in the coming years and decades, and it’s one that companies could benefit enormously from. Fleet managers can save on the administrative costs of processing and paying mileage claims; older and less efficient grey fleet vehicles will spend less time on the road; employees are making journeys in newer vehicles with the latest safety technology; and shared vehicles are more likely to be electronically tracked and verified, thanks to the use of telematics systems.

[1] Nine things you need to know about corporate car sharing