Company car choice to decrease due to recession
22 December 2008
A leading leasing firm is predicting a recession-driven swing back to single-badge fleet deals.
GE Fleet Services believes company car schemes similar to those of the 1970s are making a comeback according to their research.
The quarterly Company Car Trends survey by GE suggested employers are starting to restrict the choice employees have over the cars they drive. The emphasis on the company car as a cost-driven business tool rather than a salary benefit has also increased.
GE's figures show the number of companies allowing drivers to choose any car from any manufacturer has fallen by 8.0% in the past 12 months to 12.2% while the percentage of employers who allocate cars from just a single manufacturer has increased by 3.7% in the same period.
Gary Killeen, commercial leader at GE Capital Solutions, Fleet Services, explained: "The company car schemes of the 1970s saw employees given pretty much identical vehicles - it was common to see car parks outside factories and offices full of nothing but Ford Cortinas or Vauxhall Vivas.
"While we are not yet moving towards quite that situation, we are certainly seeing a reversal of the trends of the last decade. During that time, human resources departments have pushed for ever-wider vehicle choice and ever-higher specifications in order to attract and retain the best staff.
"In the current economic climate, that strategy has had to change, and employers are starting to look at the company car again as a cost-effective business tool. Car choice is being restricted more often and cost factors are overtaking human resources issues."
Killeen added: "The dominance of the company car as the travel tool of choice for UK businesses does not appear to be in question but what we will see during 2009 are cost-driven changes in the types of vehicles being driven, how they are funded and how they are managed."
Company Car Trends continues to underline the overall significance of the company car to businesses, with 95.5% of employers describing it as "important" for 'job-need' drivers.