International fleet managers using fuel spend to analyse their fleets
International businesses are using fuel spend data to gain much greater visibility of their fleet operations as they deal with the consequences of coronavirus and plan for the rapid transition to electric vehicles, according to fuel management specialist TMC.
The UK-based company has reported a 15% increase in the number of drivers using its mileage capture system over the past year, including 13 new large fleets in the final quarter of 2020.
The majority of these businesses were already using fuel cards, but not a fuel management system, and were experiencing issues with the correct reimbursement of employees for business journeys, said Paul Hollick, managing director of TMC (pictured below).
“They want to manage their fuel costs and drive down their fleet expenditure,” he said.
“A lot of international fleet managers are looking to understand how many vehicles they have across all of their markets, why they have them, and how many business trips they are making. Fleet is a long-term planning process; you cannot just take 10% out of your costs next year. But if you’ve got the data, you can set your strategy and work out how you optimise your asset base and your employee base.”
Focus on company car elegibility
US-owned businesses, in particular, are intent on achieving greater insight into their European fleets and establishing whether employees are eligible for company cars based on their annual business mileages, added Hollick.
“A lot of organisations over the past decade have been quite lax in enforcing that [mileage eligibility],” he said.
Grey fleet and working from home
And now, with COVID-19 dramatically changing working arrangements, including a significant increase in working from home and an avoidance of public transport, visibility of all journeys has become essential to manage what have become remote fleets, added Hollick.
Some workers are even trying to change their contracts of employment to be home based, which means they could reclaim the cost of trips to the office as business miles, although Hollick warned that there are tax complications with such an approach. In the UK, for example, to qualify as home-based an employee must spend no more than 40% of their time in the office, and cannot visit the office on a fixed, regular pattern. For instance, working from home for four days of the week but spending every Friday in the office would not allow Friday’s commute to count as a business trip.
“Employers are trying to understand what journeys their employees are undertaking, how long it takes them to get to the office and how long they are away from home in total, to provide better duty of care to employees when they are travelling on their commutes. We have a lot of drivers on our system who do not have fuel cards,” said Hollick.
Fuel data supports EV transition
Looking to the future, mileage information is the bedrock for decisions about which vehicles can transition to battery power, as companies accelerate their electrification plans.
“The scale of EV adoption in the UK has taken me by surprise,” admitted Hollick. “We have 5,000-plus vehicle fleet clients who are only ordering EVs, and it’s starting to creep across Europe depending on the tax position of markets. The first thing is to understand which drivers could go into an EV - those who never do more than 100 miles (160km) in a day can instantly go into an EV.”
Controlling spend in mixed ICE and EV fleets
Tight control of fuel spend does not end with the transition to EVs, however, with fuel expenses card provider Allstar Business Solutions, part of FLEETCOR Technologies, witnessing burgeoning demand for its Allstar One Electric card. The card provides access both to EV charge points across a multi-branded electric charging network, as well as to petrol and diesel filling stations, so fleets operating a mix of internal combustion engine and battery-powered vehicles only require a single payment solution.
Paul Holland, managing director for UK fuel at FLEETCOR (pictured above), said: “We launched it [Allstar One Electric] in answer to the direct call from fleet managers who want to move to a combination of all fuel types on one fuel card. Keeping a tight rein over finances is a key aspect of any business owner’s responsibility, and now, more than ever they should be taking control over their operations.”
Demand for fuel cards remains strong, he added, as fleet decision makers recognise the benefits that they bring, delivering more control to business processes, directly driving down fuel costs at filling stations, and increasing efficiencies, including the consolidation of fuel spend into a tax office-compliant invoice for all transactions.
“Critically, increasing efficiencies saves staff time, enabling them to refocus their attention on more important business matters like generating much-needed revenue,” said Holland.
Images: Shutterstock, TMC, FLEETCOR