Cash is in the driving seat for an increasing number of UK
employers’ company car policies. A study by consultants Watson
Wyatt has found that 28 per cent of employers provide a cash
allowance nstead of a car; double that of four years ago and more
than the proportion (23 per cent) who offer company cars without a
Watson Wyatt found that a further 46 per cent of employers offer
the choice between car and cash. This brings the proportion of
employers providing either cash instead of or as an alternative to
a company car to 74 per cent.
This is in sharp contrast to much of the rest of Europe, where
the direct provision of a company car is still largely the norm.
Over 70 per cent of employers in Belgium, Greece, Italy, Portugal
and most central and eastern European countries provide company
cars only, without a cash alternative.
The data comes from Watson Wyatt’s 2008 Company Car/Cash
Allowance Report. The study also found the proportion of
employers offering cash or a cash alternative increased by 40 per
cent in the Netherlands and Ireland, 32 per cent in Germany and 24
per cent in Sweden.
This was partly driven by companies creating pan-European
company car strategies. But when employees are given a choice
between cash and wheels, many still go for the latter because of
tax efficiency, Watson Wyatt said.
Decisions driven by cost
Meanwhile, another survey by Masterlease Global Research
reaffirms cost as the main driver behind company fleet decisions.
The survey covered 11 European countries, Australia and Mexico.
Environmental concerns were still far below other priorities for
companies in most countries. In the UK for instance, only 16 per
cent of respondents said the environment was a main factor behind
fleet decisions compared with 68 per cent who cited cost savings.
Similar results were observed in Austria, Belgium, France and the
Netherlands although in these countries, caring for the environment
appeared to be even less of a concern.
Perhaps encouragingly, the UK was the only country in the poll
which had more than 10 per cent of respondents citing the
environment as a main decision driver.
Motor Finance Issue: 43 – May 08
Published for the web: May 27 08 10:9
Last Updated: May 27 08 10:32