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Mercia Fleet Management launches new grey fleet service

Date: 20 October 2021   |   Author: Sean Keywood

A new grey fleet service has been launched by Mercia Fleet Management, the recently-established division of Fleet Evolution.

The service is said to be designed for businesses with significant numbers of employees using their own vehicles on company business and then reclaim business mileage at up to 45p per mile, under the Approved Mileage Allowance Payments (AMAPs) scheme.

Mercia Grey Fleet Management looks to assess the need to use vehicles to attend regular business meetings or visit clients and evaluates the cost efficiency to the business of using AMAPs, using a decision tree based on the number of business miles that are required to be travelled.

For example, if the journey is under five miles, a typical recommendation might be to take a taxi or cycle where appropriate. At 15-25 miles, the advice would typically be to use employee-owned vehicles with checks carried out on vehicle condition and relevant business insurance before allowing use. 

From 25-100 miles the suggestion might be to take the train or consider a taxi, comparing the costs of these alternative means of transport to those likely to be incurred under AMAPs.

And at over 100 miles, the recommendation would be to use a hire car as being the most cost-effective option, with all bookings handled by Mercia Fleet Management administrators.

Fleet Evolution managing director Andrew Leech said: "Our key objectives with Mercia Grey Fleet Management are to mitigate risk, as well as assessing cost effectiveness to the business.

"Allowing employees to use their own vehicles exposes the business to considerable duty of care risks as, generally, employees' own vehicles are in worse condition than new - typically they are eight years old - and are often without adequate servicing or relevant business use insurance.

"Our starting point is always to assess whether a journey is required at all as one thing the pandemic has shown us is that online conference calls can be as effective as face-to-face meetings.

"Another focus of the grey fleet management service is the cost of using AMAPs and for a business trip of, say, 150 miles where the reimbursement cost might be £67.50 we would always suggest using a hire car.

"Not only would this work out cheaper, but the duty of care risk is removed as the car would be new or nearly new, regularly serviced and correctly insured by the rental company."

The new service will be free for the first ten businesses that apply for it as a limited time offer.