For businesses looking to expand their fleet size, the cost of living crisis combined with the limited availability of new cars has forced employers to explore alternative routes.
Whilst operating costs continue to rise – affecting everything from energy bills to vehicle maintenance costs – many employers are reluctant to commit to extra expenses. As well as the initial outlay, the cost of servicing, MOTs, and maintaining additional vehicles has risen substantially. But it’s not just the cost. With lead times for new cars still spanning up to a year, it has caused significant delays in the process.
Without the extra capacity, fleets could struggle to satisfy customer demand. This can prevent them from reaching their growth targets or realising profit opportunities. However, the current difficulty in attaining new vehicles has forced many employers to seek alternative options…
Introducing: Growth of the Grey Fleet
A quick and cost-effective way to increase capacity is through the grey fleet.
The grey fleet is where the employer reimburses its staff to use their own vehicles for regular business-related journeys. When taking on additional drivers to increase capacity this way, there is no initial cost of acquiring extra vehicles. This is a good option when looking to grow as it keeps fixed costs to a minimum. It reduces the risk and financial commitment, even if only used as a short-term solution.
However, if intending to grow via the grey fleet, it’s key for employers to ensure their team members’ licences are valid and vehicles are compliant.
Requirements, Responsibilities, and Risks Involved
Employers must ensure that all grey fleet vehicles are correctly maintained and roadworthy. This is a legal requirement for UK employers and should be built into their processes, however, is often overlooked. According to research by Arval Mobility Observatory –“62% of companies do not have any form of grey fleet policy in place and only 16% have adopted what they describe as a “comprehensive” policy covering the subject […] A huge proportion of companies don’t have any formal structure in place for handling this crucial safety issue which, if it is not taken seriously, not only increases the chances of accidents but could even see directors of companies being liable in the event of a serious incident.”
Ensuring each driver is correctly licenced is also essential. This can be easily managed using an automated system like Licence Link, returning results in real-time, and managing driver licences in bulk.
Melvin Jeffers, Head of Licence Link summarises – “More and more businesses are turning to the grey fleet for a fast and flexible way to grow, as it keeps costs down. For those doing so, it’s important to establish a sustainable checking routine from the get-go! They need to manage privately owned vehicles and their company-owned counterparts equally. Just because they don’t own them, they are still responsible for their use.”
Navigating the challenges posed by the current cost of living crisis and the scarcity of new vehicles, businesses are increasingly turning to the grey fleet as a viable solution for fleet expansion. This approach offers a cost-effective means to boost capacity without the initial financial burden of acquiring new vehicles. However, for employers considering this avenue, it is crucial to establish a robust framework that addresses the legal and safety aspects associated with the grey fleet.