​The Grey Fleet’ Delusion: All you need to Know about Personal Cars for Business

No firm would welcome the revelation that they have been annually overpaying by up to 15% for a vital business asset.

However, even for those who spearhead established and thriving businesses, it’s quite possible they have persisted with ‘grey fleets' under the misconception the practice is saving them unnecessary outlays.

For those who don’t know, a grey fleet comprises a group of employees who use their own personal vehicles for business purposes.

While there are certain advantages to utilising a grey fleet - like avoiding protracted contracts, the potential use of a fuel-efficient vehicle and lower taxes - ultimately, the returns that may be gained are actually minimal.

Conversely, there are a plethora of possible financial pitfalls that come with the use of grey fleets.

Such as?

Kilometre Threshold

For starters, mileage may become an issue as soon as an employee exceeds pre-determined km on any given journey and, in most cases, renting a vehicle and paying for fuel is less costly. Reimbursing on a mileage basis, even at the bare minimum, is rarely financially viable.

Furthermore, if a business has a large number of employees filing for mileage reimbursements, it can, in the absence of an established reimbursement process, become increasingly difficult to remain fully cognisant of the true cost being incurred.

Giving Up Quality Control

It may seem that entrusting an employee with the maintenance of their vehicle alleviates cost, but it's rarely that simple.

Ceding control of such a fundamental aspect of your business involves a great degree of risk. If you are not completely aware of the condition of every vehicle in your grey fleet, having a viable contingency plan in the event of an unforeseen issue is highly unlikely.

What’s more, addressing such situations in a timely manner will not be cheap, and can leave deadlines unmet.

In the event a business decides to take over the regular upkeep of its grey fleet, the investment in man hours and capital could be untold, thus decimating profit margin.

It also provides a business with little say regarding the size of its carbon footprint. While the impression made by an ageing personal vehicle may not be one the company wishes to give.

Liability! Liability!

Is all your grey fleet covered by corporate insurance or just on the driver's personal policy? Should any of the grey fleet be involved in an accident while on company duty, the business will, to at least some degree, be liable for damages or claims. Depending on the severity of the incident, employers could be vulnerable to prosecution from a variety of sources.

Because grey fleet vehicles do not belong to the company, fleet managers face complicated issues when it comes to managing the safety of their fleet.

Employees using their own car may be outside of the established insurance and servicing policies, meaning their vehicles are not covered for company travel. Another issue is attempting to keep track of the status of grey fleet vehicles to ensure they meet legal road requirements.

In the event of an accident where fault is with the owner of the grey fleet vehicle, a business owner who claims to have been unaware of the health of their entire fleet will, at best, appear negligible.

Take, for example, an Architectural consultancy company whose remit involves regular visits to vendors and clients.

An employee may travel to an appointment in their own car which, unbeknownst to the company, has not been adequately serviced for some time, and then suffers an injury in a road accident.

The company is potentially financially liable and, as aforementioned, vulnerable to significant damage to their reputation for not providing a safe workplace for its staff.

Such cases are all too frequent, but are easily averted. Here’s how:

The Europcar Solution

  • Fully scalable business fleet solutions from single vehicle to multi-fleet options
  • Rolling fixed rates – just pay when you rent – pro-rated on all long term business rentals
  • A truly versatile fleet averaging less than 9 months old
  • Ability to conveniently adjust rentals based on business needs
  • Inclusive servicing and maintenance
  • Access to our National Network of 18 nationwide locations with 7-day per week collection
  • Off Balance sheet funded vehicle solution – avoiding capital outlay
  • A fit-to-purpose comprehensive fleet of new cars and vans
  • An convenient insurance process that allows both company owned insurance or rental insurance options
  • The avoidance of unnecessary spending with our smart fleet rental option
  • Expert dedicated Business Fleet Services Team that will customise your business needs
  • Full reporting software to manage your own business
  • Fully ‘trackable’ business fleet through state of the art telematic reporting
  • A true partnership approach to your business needs

Europcar Vehicle Cover

Europcar offer flexible short and long term van rental solutions including business vehicle option. For more information about our flexible, efficient and simple fleet solutions, please do not hesitate to contact us.