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Focus on TCO not fuel prices for procurement

So says Steve Clarke, group marketing manager of The Fuelcard People, as he says that cheaper diesel makes comparison between diesel and petrol cars increasingly complex, but that misses the key issue in fleet procurement.

Commenting on the news that diesel remains cheaper than petrol on most forecourts, Clarke said: “Pump pricing is a red herring because nobody need pay that much. Whether a car runs on diesel or petrol, most should be refuelling at up to 4p per litre below pump prices with fuel cards. Whole-life costing, or total cost of ownership, has to be the key issue in vehicle comparisons.” 

He added: “Diesel became cheaper than petrol this summer, for the first time since 2001. Better mpg figures for diesel might suggest an obvious choice, but that misses the point. Unless you consider every cost during a vehicle’s lifetime, any comparison will be meaningless.” 

Clarke also advised that TCO figures should take into account road tax, servicing, maintenance, repairs, tyres and other consumables to provide a holistic view of a vehicle’s real-life costs.

“You have to keep track of everything spent through a vehicle’s life with the fleet,” he added. “It is the only way to make meaningful evaluation of one vehicle against another. It also puts you in a more powerful negotiating position when procuring future vehicles.”

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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.