How the Company Car is Still Thriving as a Morale-Boosting Incentive in the Age of Coronavirus
The COVID-19 pandemic has transformed working life in just about every industry around the world. Despite widespread disruption, The Association of Fleet Professionals (AFP) believes that the company car market may experience growth - rather than decline - as a result of Coronavirus.
Although the AFP chair, Paul Hollick notes that there will be changes in the way that employees operate, with increased remote options and conference calling, may result in some company vehicles disappearing, he said: “the bigger picture was much more complex - and overall fleet numbers could even be growing.”
Despite the greater emphasis on remote work, Hollick argues that the company car will remain a highly effective tool for businesses and oftentimes their only viable transportation option. “All the other reasons that cars are operated by employers– from job need to human resources considerations – remain in place,” Hollick stated.
In a landscape that looks extremely different from that of late-2019, the role of the company car will certainly be reconsidered in the age of remote work, but its status as a key motivational tool for employees may take on extra meaning in a post-pandemic world where personal vehicles could become more scarce.
The Future Role of The Company Car
Significantly, the arrival of Coronavirus has led to fewer cars being on the roads of the UK. This diminishing need for motor vehicles may actually help to secure the future of the company car.
(Image: Office for National Statistics)
The statistics surrounding the use of various vehicles in the wake of the pandemic are curious. On the surface, it appears that car usage recovered during the late 2020 summer months in the UK where the country had briefly left its state of lockdown. However, when considering that the use of busses and National Rail have consistently seen much lower capacities, it appears that even as a replacement for public transport, cars can barely recover their usage.
These statistics raise the question of how valid personal motor vehicles are in the age of remote work.
With company cars representing a significant opportunity for drivers to save on getting from A to B safely whenever they’re required to leave their home office, the company car may have a case for replacing personal cars for essential travel.
With cycling activity peaking at nearly 400% of its pre-COVID levels and the transition of businesses and services to online, the future role of the company car could be a significantly more prominent one moving forward.
Motivational Benefits
The benefits of utilising company cars are vast. Not only can it help to cut the national insurance contributions of employers, but it can also provide a significant morale boost to your staff and bolster your favourability within your recruitment efforts.
At a time of widespread change to how people work, studies have shown that the pandemic has caused more employees to reconsider their careers. With this in mind, introducing a company car scheme could be an ideal approach towards employee retention.
Furthermore, if the car is managed through the company, it can often come with a greater level of convenience for employees with the company also handling service and maintenance.
Cost-Effective Solutions After The Pandemic
As we’ve already touched on, there are widespread money-saving ramifications for both employer and employee alike when enrolling in a company car scheme.
Through implementing a company car scheme, it’s possible for your company to claim capital allowances that can reduce the business’ taxable profits. There’s even the opportunity to add advertising and branding to your cars to better promote your business.
Employees can feel the financial benefits of a company car, too. The scheme will carry no ramifications on the employee’s national insurance contributions and can save them thousands of pounds per year on public transport costs.
Although there are car finance bad credit options available for employees, having a car provided to them can significantly help them in gaining access to a car where it wouldn’t otherwise be possible.
The pandemic may have turned the world on its head over the past year, and although it’s not going to be over any time soon, company car schemes could be ideal to keep your employees motivated and aid their safe journeys for business. With fewer cars on the road and more financial incentives associated with company cars, this could represent one of the most mutually beneficial steps your company can take in the wake of Coronavirus.
