28th February 2017

The focus on pushing the UK’s grey fleet further into the shade

Rather like the political stage, which has seen game-changing shifts in the forms of Brexit and Trump over the last nine months, the motoring scene is also morphing briskly. This is not just occurring in more obvious ways like autonomous and electric vehicle development or April’s VED rise, but more subtly, too. Over the last year or so, the race for all manner of organisations to encourage their grey fleet drivers to leave their vehicles parked in the shade has been accelerating. Why is this and what are the benefits of company drivers utilising alternative solutions rather than their own cars?

Offences, risks and poor maintenance

A recent survey by Licence Check1 with the purpose of identifying the most common traffic offences found on the licences of grey fleet drivers revealed that speeding offences rank in top spot, with ‘construction and use’ transgressions in second place, and insurance-related offences listed as the third most common indiscretions.

The average grey fleet vehicle is just over eight years old and the BVRLA recently identified a typical MoT failure rate of 40% amongst such vehicles, meaning that a sizeable number of grey fleet cars on UK roads are potentially unroadworthy or at least pose a degree of risk to other motorists.

A similar study carried out around the same time by Enterprise2 found that 27% of grey fleet drivers interviewed admitted to driving around in vehicles with one or more warning lights displayed on their dashboards, 57% have never checked their tyre pressures and 17% of cars are only checked at their annual MoTs or services.

These concerning findings suggest that some grey fleet drivers have developed a lax attitude towards safety, potentially endangering the lives of other road users while driving their own cars for business purposes. Such attitudes are also exposing employers to health and safety liabilities if an accident or worse occurred that could be attributed wholly or partly to poor vehicle maintenance, with work-related grey fleet road accidents currently costing UK organisations £2.7bn per annum.

Owner-drivers cutting corners by not taking out adequate car insurance that covers business use also expose themselves and others to increased risks and liabilities.

Public sector and the environment

In the ‘Getting to Grips with Grey Fleet’3 report from the BVRLA and Energy Saving Trust, published last summer, it was revealed that 40% (14 million) of all vehicles on the road are grey fleet and cover around 12 billion business miles every year. The public sector has traditionally embraced grey fleet use in recent years, with 1.5 billion miles driven in grey fleet vehicles by people working for local councils, the NHS, civil service and other organisations.

The BVRLA/EST report identified that public sector grey fleet vehicles contribute 1,118 tonnes of harmful NOx towards the UK grey fleet’s overall production of 8,156 tonnes, which roughly equates to double the emissions from all TfL buses over twelve months.

Grey fleet solutions

Sadiq Khan and Chris Grayling are striving to rid London of as many diesel vehicles as possible. There is an imminent rise in VED, and there’s also a push to prove that autonomous vehicles can work successfully amongst normal traffic as demonstrated by the Hains family in Sweden and soon to be witnessed in London with Volvo’s Drive Me4 trials. Against this increasingly colourful and complex backdrop, along with other economic, environmental and legislative factors, organisations are increasingly stepping up to the plate to tackle the UK’s grey fleet challenges.

Car clubs

With much attention on and investment in Mobility as a Service (MaaS) solutions, one grey fleet alternative that a growing numbers of organisations are turning to is the car club. North Ayrshire Council5, for instance, introduced a car club eighteen months ago, which 500 of its employees have now joined, and enjoys a 37% reduction in grey fleet CO2 emissions. To retain some of the convenience that has made grey fleet usage so attractive to many employees over the years, North Ayrshire Council staff can take a vehicle home the night before an early-morning meeting the following day, for example.

Business contract hire or ‘leasing’

Pointing at Approved Mileage Allowance Payments (AMAP) as a factor that has done little to discourage grey fleet use, the BVRLA has urged the government to promote alternatives, even if many organisations simply introduce company car salary sacrifice schemes whereby staff are provided with brand new and hence more fuel efficient, less polluting and safer vehicles via traditional contract hire and leasing schemes.

Public transport or healthier means of mobility

The EST would also like to see employees encouraged to walk or cycle to work if possible, or take public transport as an alternative – which would require increased investment in the medium term but would ultimately reap wide-ranging benefits.

Potential challenges to overcome

Sadiq Khan’s proposed diesel scrappage scheme6, primarily focussed on London but which will hopefully be rolled out to other UK cities in due course, could significantly reduce the impact of grey fleet on the environment, on companies’ bottom lines and on motorists’ safety, but for employees on lower incomes it may not be straightforward for them to lease or buy newer vehicles through personal contract hire (PCH). Electric vehicle charging infrastructure will also need to be improved and expanded if it’s hoped that grey fleet drivers and other organisations will increasingly embrace PHEVs and EVs.

Grey fleet software and management

Computer packages incorporating monthly mileage claims are widely available, as are driving licence check systems, and many contract hire and leasing brokers offer complete grey fleet management solutions for organisations that perhaps don’t have the time or resources for maintaining an accurate oversight internally.

Telematics

This is another solution increasingly being turned to by various bodies small and large, with Lex Autolease’s most recently available Report on Company Motoring identifying that during this year 12% of UK fleet managers anticipate that they will introduce a tracking solution of some kind.

From more traditional ‘black box’ hardware products to purely smartphone app-based systems such as Appy Fleet, telematics can help reduce the number of opportunities that owner-drivers have to claim inflated mileages whilst driving grey fleet vehicles, as well as aiding organisations to address environmental and safety impacts. Telematics systems have the added benefit of encouraging safer and more economical driving, saving 5-20% of typical fuel bills whilst reducing CO2 emissions. Tracking personnel whilst driving grey fleet vehicles on business means that mileage claims can no longer be innocently rounded-up or fraudulently inflated, improving profitability, and the inclusion of ‘Private Mode’ also annuls privacy concerns that have traditionally made some fleet managers reluctant to introduce telematics.

While it’s clear that the UK’s grey fleet has reached untenable levels, posing risks in various ways, it’s also evident that alternative solutions exist and are growing in number and approach, hopefully paving the way for our roads to become cleaner and safer in a shorter than anticipated timescale.


1. http://www.fleetnews.co.uk/news/fleet-industry-news/2017/01/25/top-licence-endorsements-of-grey-fleet-drivers-revealed

2. http://www.fleetnews.co.uk/news/fleet-industry-news/2017/01/25/research-suggests-grey-fleet-drivers-don-t-carry-out-vital-maintenance-checks

3. http://www.bvrla.co.uk/news/bvrla-calls-action-grey-fleet-use

4. http://www.bmmagazine.co.uk/newswire/volvo-seeks-volunteers-for-self-driving-car-trial-in-uk/

5. http://fleetworld.co.uk/north-ayrshire-car-club-cuts-costs-and-co2/

6. https://www.contracthireandleasing.com/car-leasing-news/diesel-scrappage-scheme-2017/

 

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