What is the size of the UK company’s fleets?
It is estimated that the size of the UK’s company fleet has remained stable over the past decade, amounting to just under one million in total. However, in the most recent (provisional) statistics looking at this data for 2017/2018, the Government predicts that this number is set to fall.
Many analysts believe the number of fleet vehicles in the country could continue to drop in the coming years, as a result of a number of changes including new mobility solutions, an increase in tax, as well as increasing urbanisation. With this in mind, how do you future-proof your fleet? As one of the leading fleet insurance companies in the UK, we decided to take a closer look.
Is the fleet sector still thriving?
Yes: whilst analysts believe there may be a reduction in the number of fleets in the years to come, it doesn’t mean that the sector is becoming less important.
For example, in a recent British Business and Mobility Study, over two-thirds of those companies surveyed (66%) said they anticipated that their essential car fleet numbers to remain the same for the next 5 years. Furthermore, 18% predicted an increase in their numbers.
What’s more, in another survey by Europcar Mobility Group UK involving business decision-makers, over 45% of respondents said they saw their company vehicles or vans as a fundamental part of their mobility landscape in 2022. This was the highest proportion of any available option.
Meanwhile, in another report by the firm Alphabet, 73% of British workers who took part said they saw their car as vital for their daily commute.
Why are fleets still important?
Whilst the UK government will be implementing new policies in the years to come that will put pressure on vehicle use (for example, reducing congestion, improving safety as well as air quality), fleets will still remain important. This is because employees value the benefits that come with a company car, and it still remains the case that it is usually the only practical option for workers.
Future-proofing your fleet: what should you look out for?
One of the most significant changes that will become apparent in the years to come is changes to tax, which will come into effect in April 2020 in the UK.
In April 2020, thee will be a new system of company car tax, and one of the main features will be new tax bands for lower emission vehicles, which is calculated on how much C02 they emit.
Furthermore, the government has recently announced new benefit-in-kind rates (BIK) which will remain in place until at least 2023, meaning that employees who have fully electric cars will not be required to pay any BIK in 2021.
A decline in driving numbers
Statistics show there has been a decrease in the number of young adults who have full driving licenses, and it is anticipated that this trend will continue. For example, the Department of Transport figures shows that in 2017, only 30% of those aged between 17-20 had full driving licenses. Comparatively, in the 1990s, this figure was almost half, at 48%.
Why? More young people than ever are using public transport or using services such as Uber to get around.
Road charging changes
It is anticipated the government will implement a UK wide-road charging system in order to recuperate the money they lose in tax thanks to more and more people opting for electric vehicles.
This is something that fleet managers will need to keep an eye on, getting to grips with their fundamental busienss travel requirements in order to keep on top of any additional costs in the years to come.
UK-wide rollout of 5G
This has the potential to be useful for fleet managers. The rollout of 5G across the country will help to accelerate autonomous vehicle technologies and help to make the use of them more commonplace and improve car-to-car communication. For fleet firms, this could be extremely advantageous, as it could help to transmit car mileage and faults at a faster pace to a fleet manager.
Growth in shared services
In a survey by Europcar Mobility Group, over one-third of those surveyed believed that public transport was not sufficient for business travel, and the anticipation is that shared car services will become more popular. For example, in the same survey involving business decision-makers, over 27% believed that car clubs or car shares will account for 27% of employee mobility, and 23% anticipated that the pool fleet by 2022 will become a key part of business travel.