Feature: Car Sharing
Sharing rather than leasing might provide a more efficient solution for your business. Martyn Collins finds out more.
One of the key points to come out of our recent Grey Fleet + Mobility Survey is that while fleets have grown, the majority now allow employees to use their own vehicles. A total of 77% of organisations stated that they currently allow some form of grey fleet operation.
So, what do you do if you don’t want to get mired in the ‘duty of care’ issues and mileage claims associated with employees running their own vehicles? One of the most viable alternatives to grey fleet is the car sharing scheme.
Under such schemes, cars and/or vans supplied to employees for set periods/ mileages are instead replaced with shared vehicles, available for ‘on-demand’ 24/7 access under a monthly fee. These can be either located at the business address, or in the case of Zipcar for example, its fleet of 3,000 cars are parked near offices and homes across London, Cambridge, Bristol and Oxford.
There are no limits to the number of employees who can be members, although they must be licence checked, and the vehicles are available to book via unique booking software held online.
It’s a service that’s already popular with both the public sector and private businesses. For example, Zipcar’s current customers include Deliveroo, NHS Trusts and Croydon Council. Users are attracted by the numerous business benefits including improved utilisation, reduced carbon emissions and significant cost savings over rental. Croydon Council for example has saved 42% of its annual travel budget and cut total CO2 from travel by 36%.
The improved vehicle utilisation offered by such schemes is thanks to the application of the latest fleet management technology, as it’s more cost-effective to have vehicles on demand than it is to have a car park full of idle cars. For the booking process, it’s vital to know the exact location of these vehicles, so they are fitted with the latest tracking systems. Although telematics on standard fleets is becoming more widespread, data from car sharing vehicles could open a wealth of vehicle and driver user information that could be difficult to collect in standard fleets.
Then, there’s the reduced carbon emissions compared to leased or purchased vehicles. Ambitious national policies, such as the Road to Zero Strategy target for 100% of the central government car fleet to be ULEV by 2030, have seen many public sector organisations planning to move a significant proportion of their fleet to car sharing. According to Zipcar, this is because it’s widely understood that a majority shared fleet is less complex to electrify compared to a mix of lease cars and grey fleet. This is because the vehicles are usually replaced more frequently.
Finally, there are the significant cost savings versus rental. Using Zipcar Business as an example, its members have access to the whole fleet 24/7 and can add an unlimited number of drivers to any one account. They also get up to 29% off standard daily rental rates and their first year of membership for free. To top it off, fuel is included, plus a 60-mile allowance, insurance and the Congestion Charge with every trip, which removes the hassle of maintaining a costly fleet of cars or vans.
Corporates have been slower to follow the example set by the public sector, but the message is beginning to filter down, as many stop relying on global leasing agreements, company cars and grey fleets to fulfil their land travel needs. In fact, according to LeasePlan, car sharing schemes are on the rise because customers’ needs are diversifying, therefore more flexible mobility solutions are required.
“Corporate car sharing schemes emphasise an on-demand mobility solution that offers flexibility and choice, two sought- after ‘wants’ we know our customers are looking for, offering increased vehicle
utilisation, reduced carbon emissions, and a lower number of grey fleet vehicles. It’s ideal for companies who continue to seek out new ways to cut costs, reduce parking issues, and reduce their environmental footprint,” says the company.
However, LeasePlan is keen to stress there is no one-size-fits-all solution for every business need. It seems that as mobility providers, companies offering car sharing schemes need to adapt to the changing needs of their customers, giving them a selection of options to pick and choose which works for them best. “That’s why we are constantly looking towards the future of ownership and usership to ensure the services we provide continue to meet our customers’ needs.”
Another two brands – which, on top of building a strong network of car sharing in major areas, have also looked at the differing demand for car sharing for businesses and members of the public – are E-Car Club and Ubeeqo.
Acquired by Europcar Mobility Group in 2015, they’ve identified a solution that provides access to vehicles for businesses during the week and for general consumers outside of work hours. Patrick Cresswell, managing director, Ubeeqo UK, says: “We believe that this approach is central to tackling the challenges of congestion and emissions, whilst recognising that businesses and their people need to stay on the move.”
It works by giving the client the opportunity to recoup some of their investment, by taking a rebate on third-party use, if they decide to.
Providing an example for corporates, one local authority that E-Car Club has worked with is Scottish Borders Council. In December 2018, E-Car Club deployed a fully managed fleet of low-emission vehicles, replacing the council’s previous pool car fleetfleet, and available to the public out of hours.
This 55-car scheme followed a pilot project with 15 vehicles. Over a two-month period, E-Car Club worked closely with Scottish Borders Council Business Change & Programme Management team to deploy a mix of hybrid hatchbacks and 4x4s. These low-emission vehicles were then placed at eight different locations across the Scottish Borders, to cater to the mobility demands of various council departments. Grey fleet expenses were analysed and determined that 55 vehicles would provide a workable solution for employees, using best ‘base’ locations for the vehicles, dictated by where many staff are situated.
Cresswell says: “Within the first six months of introducing the new scheme, Ubeeqo took over 6,500 bookings through a bespoke automated booking system, with the cars collectively travelling more than 290,000 miles. By replacing the previous pool fleet, which had been made up of a variety of different vehicles, the new scheme has already enabled Scottish Borders Council to reduce its emissions so significantly that the CO2 savings equated to planting 4,800 trees.”
The switch from fleet managers to mobility managers
So, having access to transport options for employees is fundamental for most businesses. However, addressing this basic need is a real challenge for today’s fleet managers – who are now morphing into mobility managers, on top of juggling business productivity with cost control. They also need to include employee wellbeing into the mix. Taking all this into account, plus the current economic uncertainty, makes the prospect of long-term commitments less and less appealing according to Peter Crabtree, corporate sales director at Europcar Mobility Group.
“What we have seen happening is that, rather than firms simply looking at car hire as a one-day, short-term option, they are incorporating it into overarching mobility strategies that can be made available to all employees. We think this is really demonstrating the shift from ownership to ‘usership’. And that’s where car sharing comes into its own.”
Both E-Car Club and Ubeeqo believe car clubs are a fundamental part of the overall mobility challenge. Europcar Mobility Group is working closely with several organisations to help them understand the benefits of adopting the car club model for their own ‘pool fleet’ needs, which Crabtree describes “as a true collaboration of traditional rental and car use by the hour”.
He adds: “Europcar Mobility Group UK has also been evolving to develop a range of flexible mobility solutions to help keep staff on the road. We believe that the more control employers can have in the choice of mobility, the better for their duty of care responsibilities, as well as cost control. And we aim to span the whole spectrum of mobility solutions, whether it’s ultra-short-term car use by the hour through our Ubeeqo brand; traditional daily rental from Europcar or flexible, long-term hire through Europcar Advantage or a combination of all.”
Europcar Advantage provides access to brand-new cars and vans for three months, or more. With no pressure of upfront costs and a choice of contract lengths, firms get all the benefits required to offer staff access to the mobility they need while staying in control of their costs. “A real shift we are seeing is in the use of Europcar Advantage to create a company ‘pool fleet’ that can be accessed by a range of employees. In other words, a car club – but just for the employees.”
Crabtree believes employee wellbeing is another key issue that rental and car share tackle, providing instant availability when vehicles are needed rather than time-consuming acquisition and year-round management of the asset. “And the use of a hire vehicle also means there’s an easier way to manage and monitor employees’ travel activity and costs compared with using their own vehicles.”
The right system to access a range of mobility solutions is vital to make this approach work for business and in Europcar’s case this is from a single employee portal – Europcar One.
“Europcar One makes a wide range of mobility solutions accessible from one platform. As well as delivering the most efficient customer journey, from reservation creation, through the mobility service usage, to the point of invoicing, Europcar One helps business travel managers understand and analyse how the use of different mobility options impacts financial and environmental targets, to inform future travel policies.”
Car sharing schemes could play a significant role in keeping staff moving – along with the other solutions mentioned here – in this ever-changing corporate fleet landscape.