The supermarket giant has announced that its company car fleet has grown rapidly by 76% over the last 2 years, following a shift from colleagues taking a cash allowance to entering the company car scheme.  Asda now has a fleet of 1,100 vehicles funded by contract hire, with the funding and vehicle management provided by Zenith.

The announcement has been greeted by fleet industry experts, who say it’s part of a widespread trend as fleets realise the benefits of such schemes.

John Lewis, chief executive of the BVRLA, said: ‘For most employees, the company car has always been the most cost and tax-efficient way of financing a vehicle. If an individual choses a low-emission car they can reduce their associated tax bill, whereas those taking a cash allowance are likely to be paying tax on the full amount. It is also worth bearing in mind that finance costs for private individuals are likely to be higher than for company-leased vehicles, and there is no opportunity to reclaim VAT.’

David Rawlings, director of BCF Wessex Consultants, added: ‘It’s an absolutely positive vote for common sense.

‘I think people are now waking up to the fact that the company car is financially still a tremendous benefit for the majority of people. If you look at where we are, even going forwards, with the lowest rate of BiK tax at 15%, that’s a fantastic way of remunerating your staff. It’s a low tax perk. Yes, you’ve got to choose the right car models but there’s a tremendous amount of choice out there in the market at the moment.’