The grey fleet has become a vital part of the overall transport solution for many businesses. While it can bring many benefits, allowing employees to use their own vehicles for business purposes also makes meeting your fleet management responsibilities increasingly complex.
In this guide, we’ll explain what a grey fleet is, identify some of the necessary management considerations and provide a few tips to help you operate yours more effectively.
What is a Grey Fleet?
‘Grey fleet’ is the term that describes the use of personal vehicles for business purposes. Rather than belonging to the company, the vehicles are owned by the employees themselves and are used regularly for business travel. That can include vehicles that are privately owned by the employee, rented privately or bought through an employee ownership scheme. When their vehicles are driven on company business, the employees are typically given a cash allowance or a fuel expense in return. The vehicles then fall under the responsibility of the employer and become part of the grey fleet.
How Big is the Grey Fleet?
Recent estimates put the grey fleet at around 14 million vehicles. That figure has grown significantly from an estimated one million vehicles a decade ago. Some of that growth can be attributed to a wider awareness of what the grey fleet actually is. However, modern companies like Uber and Deliveroo – for which drivers use their own vehicles for business purposes – have added to grey fleet numbers considerably.
Research by the government-backed Driving for Better Business has found that 90% of 1,006 UK employees use their own cars for business, while 75% do so at least once a week.
Photo by Torrenegra is licensed under CC-BY 2.0.
Managing a Grey Fleet
Managing a grey fleet has different time and cost implications than you’d expect operating a regular fleet. Grey fleet management is certainly not an area you want to get wrong. Under the Corporate Manslaughter Act 2007, companies can be prosecuted for the death of drivers resulting from work-related journeys. However, despite the risks, managing a grey fleet can have its benefits over operating company-owned vehicles, particularly for businesses that do not cover high mileage.
Firstly, it’s often much cheaper to simply reimburse employees who travel for work outside of their normal commute rather than buying and maintaining company vehicles, particularly when those journeys are few and far between. The lower mileage also reduces the likelihood that the business will be made liable for accidents or vehicle damage will occur while employees are driving for work purposes.
However even for low mileage businesses there are still difficulties associated with managing a grey fleet. It can be difficult to track the mileage employees do on business journeys and that can open employers up to the risk of overpaying. General vehicle maintenance can also be more difficult to manage on a grey fleet, particularly given that personal vehicles are often older and in worse condition than company vehicles. Then there’s the duty of care to consider, which can be neglected if older, poorly maintained cars are being used.
Is a Grey Fleet Right for Your Business?
A grey fleet only really makes sense for smaller businesses that do relatively few low mileage journeys. However, that doesn’t necessarily make this solution the right choice for you. There are also a number of other things to consider:
1. What are your travel needs?
Assessing the travel needs of your business now and in the future and exploring all the options available to you is a must. In some cases you may find that a car share scheme or even rentals could be more suitable.
2. Do employees understand the implications?
Employers and employees have to be on the same page for a grey fleet to work. It’s important that you create a management plan that explains simply what employees need to know. That includes how they’ll be reimbursed, how they should report mileage, how they can get approval for journeys and what maintenance obligations must be met.
3. Will you be able to get hands-on?
For a grey fleet to really work for your business, you must be able to manage it like any other business fleet. That means diagnosing issues with the vehicle, tracking vehicle consumption and general wear and tear and knowing when the MOT, service, insurance and breakdown cover is due for renewal.
Cleaning a Grey Fleet
A key element of an employer’s duty of care is to ensure that all vehicles, whether company-owned or privately owned, are safe to drive at all times. Although grey fleet maintenance is outside the company’s control, employers can take steps to clean their grey fleet to reduce accidents and improve standards of driver safety. Clean cars are safer and cheaper to drive, making it a simple way to boost the efficiency of your vehicles.
Try our On-Demand, Waterless Fleet Cleaning Service
At Dropless our business fleet cleaning service will keep your grey fleet clean while saving you time, money and hassle. Using specialist nano solutions, we save over 150 litres of water per wash and produce zero hazardous runoff. We’ll also travel to your premises, whenever you need us, to make your fleet cleaning a breeze. Get in touch to find out more.