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Why Should Employees Not Choose a Company Car

Apr 15, 2008
Some employers may ask, why should they have a choice when after all a company vehicle is no more than a tool to allow the employee to do their job?

Well there are a number of reasons. Firstly if the company is using Contract Hire for their company vehicles as most are nowadays. There can often be very little difference in cost between the car the employer intends to provide and the car the employee really wants.

Bearing in mind that surveys have revealed that over 20% of employees will change their job if offered a better car, is it wise to restrict an employee to a car that he or she really doesn't want to drive? Under these circumstances an extra 50 Pound a month additional Contract Hire rental may appear inexpensive, compared with the cost of loosing a key employee to a major competitor.

But why is that employees will change jobs simply because they are offered a better car. What about all the other considerations like job security, working environment and future prospects, surely they cannot all think in such a short term manner? Generally they do not, however cars are such an emotive issue that they can tend to override other considerations; it is not merely a form of transport, for many it is how their friends, neighbours, clients and other road users view them.

It is often the only way the have of showing people that they are successful. Employers can sometimes lose golden opportunities by not being more flexible on the choice of business vehicle, particularly when it comes to sales people. The type of car they drive is often vitally important to sales people, one only have to look at the cars that sales people buy in situations where they fund their own vehicle.

Why not discuss the increased cost of an improved company car and link it to the sales person's target? This could make the additional cost of the car insignificant compared with the company's increased profitability. Clearly the type of car the salesperson is to drive has to be balanced with the products or services they are selling and the type of clients that they are visiting.

Generally speaking it is unlikely that a prospective client is going to be offended by a salesperson arriving in a 3 Series BMW. Sometimes the problem with company vehicless is that accountants, who do not understand sales people or what motivates them, make decisions on the business vehicle policy and budgets.

They will therefore look at the costs of a vehicle in isolation without understanding that an improved car can be used as a means of significantly increasing sales. Clearly one wouldn't want accountants to start thinking like salespeople, or indeed salespeople to think like accountants that would be a disaster.

That is why it can be valuable for a member the sales management team to be more involved when it comes to the choice of company car. It is worth bearing in mind that at the time of writing the difference in cost, in terms of Contract Hire rental, between a 1Series and a 3 Series BMW is in the order of 45 Pound per month.

The difference in cost between a 3 Series and a 5 Series BMW is approximately 65 Pound per month. Perhaps not terribly expensive, if that additional cost enables a company to significantly improve it's sales and profitability.
About the Author
For more information about Contract Hire, Lease Purchase, Finance Lease or vehicle Hire Purchase in the UK please do not hesitate to Bowater Price plc 01494 536 536. www.bowaterprice.com
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