Key Insights for Companies with Fleets in 2019
Each year, Motus publishes the Mobile Workforce Benchmark Report. It’s our most extensive report, with everything you need to know about the state of vehicle programs today. Looking for key statistics for company car programs, or to compare your own fleet with those of your peers? You’re in the right place. We pulled out the top five company car statistics from the report centered around businesses with fleet programs.
1) A single mobile worker who is part of a company car program costs $11,619 per year on average.
According to the 2019 Mobile Workforce Benchmark Report, mobile workers in a company-provided vehicle program cost a reported annual average of $10,466. Support costs were an additional $1,153, for a total average cost of $11,619 per mobile worker per year.
On average, reimbursement programs cost 38% less than company-provided vehicle programs. And the average cost per mobile worker is $9,855, without regard to the type of vehicle program.
2) Fuel makes up 71% of fleet operating costs, according to the 2018-19 Automotive Fleet Factbook.
While cost is generally the main driver for reevaluating your fleet program, most companies also struggle to maintain a fuel policy that ensures spend is for business purposes only. Personal use chargebacks are a way to remedy this. But even so, a company car program with personal use chargebacks is still costing your company more than it should. Here’s how the costs of company-provided vehicle programs compare with a FAVR program at different levels of personal use chargeback according to the 2019 Mobile Workforce Benchmark Report.
Not sure what we mean by FAVR in the chart above? This “Fixed and Variable Rate” methodology allows companies to reimburse their employees fairly and accurately for driving their personal vehicles for work. It’s built on the fact that the costs of driving for work are specific to the individual. The fixed costs of a FAVR program include insurance premiums, license and registration fees and taxes and depreciation. The variable costs include gas, oil, vehicle maintenance and tire wear.
This program allows you to reimburse your employees with tax-free dollars for the business use of their personal vehicles. Your employees now have the flexibility to drive a vehicle they prefer, while reducing your company spend, risk and liability.
3) Fleet programs suffer from accident rates around 20%, over three times that of the overall U.S. driving population, 6%.
With higher accident rates than the average U.S. worker, fleet drivers need to be extra prepared.
According to Motus Driver Safety Research from June 2019, accidents cost 94,967 lost workdays in 2018 for those with company-provided vehicles. And that number doesn’t even begin to express the hurt that injuries and fatalities cause.
Reducing collision rates is important. Identifying and changing those risky behaviors is vital to a comprehensive safety program. One place to get started? How about customized training focused on improving areas specific to that individual.
4) 39% of people said the increased risk was the biggest factor they disliked about company-provided vehicles when choosing to switch programs.
The increased risk with company-provided vehicles is the number one thing that companies that decided to partner with Motus disliked about their old fleet program. This stat, from the 2018 version of the Mobile Workforce Benchmark Report, still rings true today.
That “24-hour” exposure that fleet vehicles add to your organization is the main difference between company vehicles and reimbursement methodologies. As an article from The Horton Group explains:
“Court rulings have sent a clear precedent that there is no distinction between ‘business’ and ‘non-business’ use when employees are driving company-owned vehicles. Liability is assumed by the employer. In addition, a business is likely to be held liable when an employee or employee’s family member has an accident during personal usage.”
5) 78% of survey respondents reported having multiple vehicle programs.
When you have company cars for your business, chances are you have other vehicle programs too.
You wouldn’t give a company car to a team member driving 500 business miles a year. But you would if they need a specialty vehicle, like a service truck or van, to do their job.
What about those sales reps, estimators and account managers? Do they really need a company car?
Giving your people the same type of program when you have a diverse set of drivers? That means you’re shortchanging some and overindulging others. Hybrid vehicle programs are one of the ways you can make sure people get vehicles or reimbursements that they need for their jobs.
Ready to take a closer look at your fleet and vehicle reimbursement programs after reviewing these five company car statistics? Here’s a quick assessment to get you started.