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BVRLA report reveals true impact of UK’s ageing grey fleet

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Author: | Updated: 20 Jul 2016 12:52

A report commissioned by the British Vehicle Leasing and Rental Association (BVRLA) has revealed the full scale and impact grey fleet cars have on the UK, costing businesses millions, damaging the environment and making roads more dangerous.

The BVRLA study – the biggest ever investigation regarding the grey fleet sector – has discovered grey fleet vehicles account for around 14 million cars in the UK, which is approximately 40% of vehicles on the road.

For those not familiar with the term, grey fleet relates to personal vehicles that are also used for business purposes.

Older vehicles make up the majority of the UK's grey fleet

According to the report, around 12 billion business miles are driven in grey fleet cars annually, with most employees reimbursed on a pence-per-mile basis.

The average age of cars in the “exhausted” grey fleet is 8.2 years old. The table below confirms that, stood next to other fleet options, they’re among the least eco-friendly cars on the road – with more than three quarters falling foul of Euro6 regulations.

Grey fleet vehicles cause much more pollution compared to leasing options

The negatives

  • The grey fleet creates over 3.6 million tonnes of C02, and 8,156 tonnes of NOx a year – around twice the emissions of the entire London Transport network;
  • Grey fleet accounts for a significant chunk of the £2.7bn cost of work-related accident insurance claims;
  • Approved Mileage Allowance Payments (the way grey fleet users are reimbursed) costs employers over £5.5bn per year.

The average grey fleet car produces 152g/km of C02

BVRLA chief executive Gerry Keaney said: “The invisible grey fleet is hiding in plain sight of Britain’s bosses and is a blind spot in the government’s transport strategy.

“It is wasting taxpayer money, costing businesses millions of pounds, damaging our environment and making our roads more dangerous.”

Cutting grey fleet mileage by just 15% would be the equivalent of taking 225,000 cars off the road in emissions terms.”

The BVRLA is calling for a concerted effort from company bosses and policymakers to tackle the grey fleet issue. The association is targeting a 50% reduction in grey fleet mileage and costs by 2020, and is urging government ministers to help by highlighting the alternatives to grey fleet use and offering best practice guidance, particularly for public sector organisations.

Fleet line-up

How leasing can help

The report cites leasing as a key alternative to the grey fleet. Lease companies offer competitive rates on the vast majority of new vehicles. It can also give employers more control over finances and the chance to cut costs further thanks to the efficiency and economy new vehicles offer compared to older vehicles.

Commenting on the report, Andrew Benfield, the director of transport for the Energy Saving Trust, said: “Switching to more modern vehicles for work purposes can lead to significant cost savings, cut vehicle emissions and improve employee safety.

“Car rental should be adopted for any work-related vehicle journey over 55 miles and a vehicle should be leased for employees driving at least 10,000 business miles per year.”

Search for business lease deals

Duty of care and risk assessment

Not only does leasing ensure employees are driving the safest, newest cars, but the assessments of many leasing companies will assure they’re always fully legal too. Duty of care is a challenging thing to provide sustainably for grey fleet vehicles, and has presented legal implications for both employee and employer in the past.

Leasing demonstrates the employer has maintained its duty of care towards the employee, thanks to the thorough licence checks and assessments that lease companies carry out beforehand. This means that employers can enjoy risk-free, fixed price leasing deals and still pay less overall than the pence-per-mile alternative. Choosing a new lease car based on its green credentials will pass further tax and fuel savings onto the employers too.

The association is calling for businesses and policymakers to create viable alternatives, aiming to cut grey fleet presence by 50% by 2020.

Check out our business hire guide if you’re interested in the prospect of leasing.

If you want to know more about salary sacrifice schemes, see which models are the most popular this year.

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