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Fleet managers shouldn't be short sighted when turning green... - June '05
20th June 2005
Fleet managers shouldn’t be short sighted when turning green….
Malcolm Noyle at Lloyds TSB autolease offers a review of the real issues surrounding the running of an environmental fleet.
Each fleet is truly unique, and ensuring it meets the individual needs of the drivers, the business and the environment is a role not to be taken by the faint hearted.
For many fleet managers a vehicle’s list price, or its monthly rental cost, helps to guide them in their buying decisions. However, this quick and easy method is short-sighted, and is not an accurate way of assessing the true financial and environmental impact of running a fleet.
Whether you purchase your company vehicles outright, or use a professional contract hire company, there are a number of crucial factors that should be considered beforehand. These include the vehicle’s fuel economy, insurance group, servicing costs, maintenance/repair charges and the actual cost of National Insurance payments for the business.
It is only when all these factors are incorporated that a financially sound fleet policy can really be appreciated. In order to build an environmentally sound fleet policy, other issues such as business travel plans, Telematics and the management of Work Related Road Safety also need to be built into the picture.
Actually sitting down and reviewing all of these different issues is a daunting task, but you will find that the best funding or contract hire businesses will already have the systems in place to estimate all of these costs for you.
At Lloyds TSB autolease we spend a great deal of time encouraging clients to look beyond the list price and rental costs, and to take a more holistic approach by looking at the vehicle’s Whole Life Costs. If you take any number of different vehicles and look at their Whole Life Costs it soon becomes apparent how the fuel, insurance and maintenance costs affect the true cost of the entire package.
Including the fuel element in your planning is not only good common sense, but it’s the only way of ensuring the vehicles are environmentally sound and therefore cheaper to operate. With this new perspective, the advantages of incorporating cleaner fuels such as LPG, Hybrid and electric vehicles within your fleet become apparent.
This holistic process has seen many businesses make considerable changes to their fleet, to reap the added environmental and financial savings. For example, some have switched from very limited, sole badge fleets, to wide ranging open choice lists, or have introduced cleaner vehicles or more environmental fuels into the fleet. By doing this, these organisations have not only reduced the CO2 output and saved money, but also enjoyed the benefits associated with drivers having more say in what they drive.
Regardless of whether you choose to buy vehicles outright, use contract hire, develop an Employee Car Ownership scheme, or offer a cash alternative, the cost of work-related driving could be enormous if you fail to understand your basic Work Related Road Safety responsibilities.
As an employer you have a Duty of Care to all staff, and every fleet manager needs to be fully up-to-speed with their legal requirements. Lloyds TSB autolease has developed a short guide on the subject – ‘Duty of Care at a glance’. We also have a specialist team designed to review and support clients in this area.
If company directors and fleet managers don’t ensure the safety of their staff and an employee has a serious accident while driving at work, they could soon face substantial fines, based on company turnover, and even the possibility of jail sentences. It’s also worth considering that the true cost of an accident, including lost time and contracts, can be anything between 4 and 54 times the cost of repairing the vehicle.
The introduction of Telematic solutions, which range from security tracking systems to more simple satellite navigation packages, will also help reduce fleet costs and improve their environmental performance. They do so by allowing the number of miles travelled to be analysed and reduced, lowering overall fuel costs and CO2 output from the exhaust.
To ensure you get the best deal for your fleet and your company, it is absolutely vital that you fully understand the needs of your business and those of your drivers. Make sure you look at the entire range of costs and different finance options available before making those all-important green fleet decisions.
For further information please contact:
Lawrence Hamilton
Marketing Communications Executive
Lloyds TSB autolease
Windsor House
Hollins Brook Way
Bury
BL9 8RT
