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Electrical retailer switches to contract hire to cut costs and enhance choice

One of the UK’s largest electrical retailers is to set to make significant financial savings and enhance employee car choice after switching to contract hire with Activa Contracts.


Lisa Temperton with (L-R): Andrew Fowell and Chris Thornton from Hughes, Peter Renton, Activa Contracts, and Mark Coleby, Hughes.

Lowestoft-headquartered Hughes, which has retail outlets across East Anglia and the Midlands, operates a 175-strong vehicle fleet comprising 140 light commercial vehicles and 35 company cars.

The firm previously used outright purchase for virtually all its vehicles with a small number being leased, but decided to move to contract hire for all company cars and vans following a comprehensive funding review carried out by Activa Contracts, the Milton Keynes-based division of Arnold Clark Finance.

Initially, Activa has undertaken a sale and leaseback deal on 86 vehicles and will fleet-manage the remainder until renewal.

Following the review, employees will benefit from an enhanced company car choice. With vehicle selection now based on whole-life costs, drivers have a significantly wider car choice, while also potentially achieving BiK tax savings.

As well as addressing whole-life cost monthly expenditure, company car selection criteria now takes into account vehicle type, engine capacity and insurance group restrictions. Additionally, a carbon dioxide (CO2) cap currently set at 130g/km is in place tied to the main rate capital allowance threshold for business cars, but that limit will reduce to 110g/km in April 2018.

The company car policy review now means that employees have up to 700 vehicles to choose from depending on their vehicle grade.

Activa Contracts is also providing a full range of in-life vehicle and driver services to Hughes including fleet and accident management and risk management that includes employee driver licence validation, while also overviewing Hughes’ driver handbook to ensure that it meets current best practice standards.

Activa Contracts’ sales and marketing director Lisa Temperton said: “Our consultancy approach has transformed Hughes’ company car policy so that employees now have hundreds of vehicles to choose from, while ensuring that the fleet is cost-effective to operate and fit-for-purpose.”

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Natalie Middleton

Natalie has worked as a fleet journalist for 16 years, previously as assistant editor on the former Company Car magazine before joining Fleet World in 2006. Prior to this, she worked on a range of B2B titles, including Insurance Age and Insurance Day. As Business Editor, Natalie ensures the group websites and newsletters are updated with the latest news.