Companies with employees who drive for company business with their own car (termed 'grey fleet') risk breaching their employer duty of care obligations if they don't know whether their employees' cars are fully taxed, licensed, insured and well-maintained. There is also the issue of managing and controlling the costs of 'grey mileage' claims.
Corporate car share schemes can help avoid these issues by deploying an on-site, dedicated pool of properly registered company cars for shared use by employees who don't need a full-time company car. Further benefits to the employer include reduced overall fleet costs, improved vehicle utilisation, freeing up parking spaces and contributions towards sustainability targets eg carbon offsetting programmes.
These schemes can, however, be notoriously difficult to manage without a robust registration/booking process and proper fleet management. Companies operating a pool fleet by themselves may have no way of knowing how effective its utilisation is or have difficulty in keeping track of costs. They often don't know who is 'squatting' (hogging the service) nor who has incurred any fines. And keys often go walkabout, causing hassles for those who want to use the service.
©iStock.com/boana
Outsourcing the headaches of pool fleet management
To overcome these challenges, many companies have outsourced their car share programme to a third party provider, such as a car rental company. These organisations will typically supply and maintain a dedicated car pool fleet for employee use, without the need for purchase of the vehicles. The fleet will be equipped with telematics and GPS tracking or speed sensors, with additional services included such as booking mechanisms, insurance, breakdown support and vehicle usage reports.
These fully managed car share services lead to a reduction in office administration as vehicles can be booked around the clock by employees themselves. Mileage and usage are automatically tracked and logged to dedicated cost centres. Furthermore, drivers no longer have to take their own (often inadequately insured) vehicles on company business, which improves the employer's duty-of-care. Employees will likely be able to access vehicles either through a personal smart card or device, or an on-car pin pad, avoiding any missing key dramas.
An outsource provider operates the Lufthansa CarPool of nearly 700 vehicles for the employees of Deutsche Lufthansa and the company's partner firms at the airports in Frankfurt, Munich and Hamburg, with some special instances in Berlin. Among its many services, the operator manages the programme registration for Lufthansa, which means taking care of checking each new member's rental qualifications (driving licence, member card, ID card).
Each of the CarPool's 40,000 members can reserve a vehicle at any time of day using the airline's dedicated CarPool website or mobile app. Cars are accessed with the employee's issued electronic token, which is swiped over the reader behind the windscreen. The ignition key is located inside the vehicle. During the rental drivers can lock and unlock the vehicle using the token. At the end of the reservation, employees return the vehicle to the designated location and end the rental through the in-vehicle display.
Saving fleet costs and supporting sustainability
Pooled fleets are also effective on a much smaller scale than the Lufthansa CarPool. Heathrow Airport also runs a managed business car share programme through a partnership with a third party provider for the 150 employees needing to travel between locations. The programme features a dedicated fleet of nine low-emission vehicles which employees can book online, over the phone or with a mobile app.
Within the first year, Heathrow Airport was able reduce its fleet size by 25% and emissions by 40%. The scheme promoted a shift to alternative methods of transport, further reducing fuel consumption and CO2 emissions. Only low emission (104 g/km) vehicles are run on the fleet, which are replaced every three years. Vehicles are tracked by GPS, and the emissions figure is calculated at the end of each month. The booking engine gives access to a rich suite of data which has allowed the car share model to be optimised - but, more importantly, also led to the removal of older and less efficient vehicles from the fleet, saving money and helping Heathrow Airport to reduce costs further.
Public sector companies are also taking advantage of managed car pool services from outsourced providers. For example, Imperial College London, Brunel University, and the University of Reading in the UK run car clubs for staff use during working hours and for students during evenings, weekends and public holidays. Thousands of staff and students have the ability to rent, by the hour, low emission or electric vehicles parked at dedicated bays on campus.
These car sharing schemes reduce on campus congestion whilst promoting a shift to public transport, walking and cycling. The car clubs form an integral part of each university's travel plan and on-going commitment to reduce their carbon footprint and protect future HEFCE (Higher Education Funding Council for England) funding.
Tips for getting started
- If you are thinking of outsourcing your car pool management to a third party rental provider, here are important considerations which we have gleaned from our car share customers.
- Ensure that you have a business case and management support. Employee surveys can help you assess likely travel patterns and car usage requirements.
- Consider whether you will need flexibility, for example, the ability to swap out vehicles for particular occasions.
- Start with a programme pilot to test the system and get people used to trying out the new programme.
- Launch a website and mobile application to ensure employees can make bookings at any time.
- To ensure employee take-up, the scheme will need to be heavily promoted internally. It helps if senior managers make use of the pool cars as well.
- You could also consider opening up cars for employee's personal use during out of office hours as an employee reward or perk.
Managed carefully, company car pools can provide an optimal mobility solution that meets employer duty of care obligations while reducing grey mileage as well as overall staff travel costs. Companies can start with a small pilot of even just one or two cars to begin with in order to get a feel for how the programme can operate to their best advantage, and then gradually increase the number of cars as more and more employees take up the programme.