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BUSINESS WISDOM
Better
business
driving
How to maximise
vehicle efficiency
and minimise your
environmental
impact
In association with
Business wisdom
LESS
TAXING
Small businesses are discovering a more efficient way
to finance business vehicles with Lex Autolease.
Find out how leasing can be less taxing on your time,
as well as your balance sheet.
Get a quote today:
CALL: 0800 012 1234 VISIT: LEASING4BUSINESS.CO.UK
Driving green
motoring forward
With the roll-out of green legislation escalating as
the EU’s 2020 emissions targets draw closer,
businesses of all sizes are being urged to take
environmental protection more seriously. By
implementing environmentally focused policies to
cut emissions, companies are not only ensuring
regulatory compliance but significantly benefiting
their bottom lines through improved efficiency, while
addressing their ecological impact from a community
and social perspective.
In this supplement we explore how companies
can embrace this eco-revolution and take advantage
of new technologies to achieve tangible business
benefits. In the fight to minimise environmental
damage, the automotive industry has come to the
fore. Progression in engine technologies, coupled
with cost-effective options such as leasing, mean
that compromises are not required when selecting
vehicles. We take a close look at the options these
advances provide for increasing efficiencies through
lower petrol consumption, together with providing
tips to reduce your motoring carbon footprint.
I hope you enjoy the supplement and look forward
to hearing your feedback.
Simon Barter
Head of SME Direct, Lex Autolease
TREND REPORT:
THE ENVIRONMENT MATTERS 4
Why motoring is undergoing its own
eco-revolution, plus a look at four of the
best green vehicles for business driving
MAKING YOUR EXECUTIVE CAR
PLANET-FRIENDLY
8
10 valuable tips on how to reduce the
impact of your transport on the
environment
EVERYTHING YOU NEED TO
KNOW ABOUT LEASING
10
10 frequently asked questions about
leasing, and how Lex Autolease can help
you with eco-friendly transport solutions
Group editor Lysanne Currie
Writer Christian Koch
Chief sub-editor Robert Sly
Creative director Chris Rowe
Commercial sales director Jo McGraw
Advertising manager Ben Hammond
Marketing director Tom Christie-Miller
Production manager Lisa Robertson
Editorial 020 7766 8950
[email protected]
Advertising 020 7766 8900
[email protected]
Production 020 7766 8960
[email protected]
Institute of Directors 020 7839 1233
www.iod.com
Published by Director Publications Ltd for the Institute of Directors, 116 Pall Mall, London, SW1Y 5ED. Opinions expressed do not
necessarily reflect IoD policy. The IoD accepts no responsibility for views expressed by contributors.
FEBRUARY 2015 DIRECTOR 3
Business wisdom
Petrol-powered engines
are fighting back, thanks
to better and more
fuel-efficient turbos“
A greener road ahead
S
hort of using tyres
made from hemp
or converting your
combustion engine to algae
(not as strange as it seems
– read on), drivers can often
feel there is little more they
can do to minimise the
ecological impact of their
motoring. Yes, there might
be an ever-growing plethora
of fuel-efficient cars on the
market plus tax incentives
aplenty, but many motorists
suppose they need to
summon superhuman levels
of green halo-ness to reach
forthcoming emissions
targets (see the EU’s 2020
target of 95g of CO2 per km
for a new car). Which isn’t
great news for air quality
campaigners – in the UK,
transport accounts for nearly
a quarter of greenhouse gas
emissions, more than half
of which comes from the
humble car.
Yet some great progress
has been made in recent
years. A 2014 report by the
SMMT showed that CO2
4
Director Business wisdom
emissions have fallen across
every strata of cars, and
executive cars in particular.
Emissions from company
motors in 2013 were lower
than those from small city
cars in 2010.
The increasing popularity
of diesel over the last decade
also accounts for this CO2
cutback. Diesel-fuelled cars
burn less fuel, therefore
producing fewer grammes of
CO2 per km than those
powered by petrol. They’re
also in demand. In 2010,
sales of diesel cars overtook
those of petrol for the first
time, possibly aided by
eco-friendly government
legislation. Today, vehicles
with high CO2 emissions are
penalised by higher fuel duty
tax, while diesels with the
lowest CO2 emissions are
exempt from road tax and
congestion charges. (They
also receive better insurance
premiums too.)
But petrol-powered
engines appear to be fighting
back, thanks to better turbos
that make them more fuelefficient. Four years ago,
diesel-fuelled cars from Lex
produced 16 per cent fewer
CO2 emissions per kilometre
than petrol-fuelled cars. By
2013, this had dropped to
seven per cent. Furthermore,
a 2013 ministry report
showed that diesel fumes
were more damaging to
health than petrol engines.
The findings, published by
the Department of Energy
and Climate Change, found
that diesel-related air
pollution contributes to lung
disease, heart attacks and
asthma, costing the NHS
more than 10 times as much
as those problems caused by
petrol fumes.
Environmental issues are
also being taken more
seriously by employers.
Recent research by Lex
Autolease has shown that
45 per cent of managers have
introduced environmentally
focused policies in the last
two years. Meanwhile, 42 per
cent of fleet managers said
I
Once maligned as gas-guzzling eco-offenders, motorists are increasingly embracing
greener ways of driving – both for business and personally – as research by Lex
Autolease and the Society of Motor Manufacturers and Traders (SMMT) shows
Business wisdom
By 2020, green automotive
technology may have radically
changed the way we drive”
they welcome the idea of
rentals based on mileage,
with 12 per cent saying they
liked the idea of employee
car clubs in city centres.
Despite this burgeoning
eco-awareness, popularity of
electric vehicles and hybrids
remains fairly debatable.
Only two per cent of vehicles
in Lex Autolease’s fleet (the
company is responsible for
one in every 33 new UK
car/van registrations) is
an electric car, reflecting
national trends which show
they account for 2.3 per cent
of the market.
However, SMMT statistics
recently revealed that
alternatively fuelled vehicles
(AFVs) were up 59 per cent
in October 2014, while
electric carmakers Tesla
delivered a record 7,785
sedans in the third quarter
of last year. Incentives
abound for electric, hybrid or
AFVs, including government
grants of up to £5,000
from the purchase price,
exemption from London’s
pricey congestion charge and
benefit-in-kind taxation.
This taxation can also be
6
Director Business wisdom
advantageous for company
cars, although Lex Autolease
has found that it triggers
confusion in many executive
car drivers. Company car tax
was reformed in 2002 to
an emissions-based system,
with the charge calculated by
applying a percentage figure
(determined by fuel type
and CO2 emissions) to the
list price of the car. If you
own a cheap car and emit
minimal CO2, you’re much
less likely to find the taxman
scary. Despite this, only
50 per cent of company car
drivers surveyed knew that
CO2 emissions were involved
in calculating their tax bill.
Furthermore, 45 per cent
assumed their tax was
evaluated by engine size
and almost a quarter (23 per
cent) believed it was affected
by the make of car. One in
seven even thought their tax
was determined by family or
friends driving the car.
A slew of emissionsslashing policies will be
ushered in during 2015. This
September, the Euro 6
emissions standards for cars
comes into force, while all
large organisations need
to complete their ESOS
energy audit assessment by
December – something
which will no doubt please
those 44 per cent of fleet
managers who would like
stricter emission standards.
However, by 2020 (the
European Commission’s CO2
emissions target year), green
automotive technology may
have radically changed the
way we drive. Self-driving
cars are due to hit British
roads in early 2015, with
cities such as Bristol,
London, Coventry and
Milton Keynes all hosting
trials. A sports car (the
QUANT e-Sportlimousine)
that runs on saltwater was
recently certified for use on
EU roads. Then there’s the
US firm Sapphire Energy,
which produces algae-based
crude oil, meaning algaepowered cars could soon be
a reality too. However, there
are already plenty of
environmentally friendly
transport options available,
as our selection of green
fleet vehicles shows here...
FOUR OF THE BEST
Four of the most efficient eco-friendly cars in
Lex Autolease’s collection
Mitsubishi Outlander
This award-winning plug-in hybrid embraces
new technology for the price of a diesel.
Offering generous space, it’s a popular
choice for an electric vehicle company car.
Nissan Leaf
Why has this pure electric car satisfied so
many of Lex Autolease’s customers? Well,
there’s the running costs of 2p per mile,
along with the fact that it heats up
instantaneously in winter (any ice on the glass dissolves in a matter of
seconds). Meanwhile, every full charge gives you a range of 124 miles and
there are zero emissions too.
BMW i3
When it hit European showrooms in 2013,
this funky four-seater was much lauded for
its futuristic design, its onboard petrol
generator (which increases vehicle range to
160 miles) and impressive CO2 emissions of 13g/km. Lex Autolease has two
BMW i3 models in its collection – a pure electric i3 and the Extended-Range
Electric Vehicle.
Renault Zoe
You’ve probably seen the TV adverts
soundtracked by The Jam’s classic song
That’s Entertainment. This 100 per cent
electric car is particularly good for short
journeys around town, such as shopping runs, with a range of 130 miles
and no toxic tailpipe emissions.
FEBRUARY 2015 DIRECTOR 7
Business wisdom
CASE STUDY
10 tips for greener driving
SAVING FUEL (AND MONEY) THROUGH LEX AUTOLEASE
How Lex Autolease helped one engineering giant save £1m a year by
reducing its fuel consumption
How to reduce your vehicles’ impact on the environment and your bottom line
TAKE A NEW
APPROACH
The average new car
emits about 20 per cent
fewer emissions than other
cars currently on UK roads.
The reason for this? Car
manufacturers now consider
meeting CO2 emissions
targets as a core factor when
determining the design of
the motor. This probably
accounts for CO2 emissions
for new British cars falling
from around 164.9g/km in
2007 to 128.3g/km last year*.
To calculate fuel emissions for
used and older cars, visit
http://carfueldata.direct.gov.uk
2
CONSIDER GOING
ELECTRIC
With government
incentives ranging from a 25
per cent grant to exemption
from London’s congestion
charge, there’s arguably
never been a better time
to purchase an electric car.
Especially when cutting-edge
vehicles such as Tesla’s
Model S, the critically
acclaimed Nissan Leaf, and
BMW’s i3 battery electric
have entered the market too.
8
Director Business wisdom
3
CAR-LEASE OR
SHARE
Drivers are
increasingly realising that
leasing cars is a greener (and
more economical) way of
driving, as the option
provides access to vehicles
with advanced green
technology that may not
have been affordable if
bought outright. As
automotive technology
continues to reduce carbon
emissions in new models,
leasing provides drivers with
access to the latest
technology with new vehicle
models available upon
contract renewal.
4
CONVERT TO
VEGETABLE OIL
As well as being
useful for breakfast fry-ups,
making roast potatoes and
baking cakes, cooking oil can
also make you drive more
efficiently too, with zero net
CO2 emissions (or so its
supporters claim). UK-based
enterprise Veg Oil Motoring
(www.vegoilmotoring.com)
can convert your vehicle to
run on the biofuel from
around £1,200.
5
EMPLOY
‘HYPERMILING’
6
Driving at lower
revs automatically
slashes fuel consumption so
change up a gear at around
2,500 revs in a petrol car or,
alternatively, 2,000 revs in
a diesel vehicle.
ABANDON AIR CON
8
DON’T ‘IDLE’ THE
ENGINE
9
LIGHTEN YOUR
LOAD
Idling the engine
can increase emissions by
13 per cent. To prevent this
needless fuel waste, where
possible drive away as soon
as the engine starts.
Hypermiling (aka
eco driving) is the practice of
driving your car so it delivers
better fuel economy. By
driving a little more slowly
(decreasing speeds from
75mph to 65mph, say),
avoiding sharp acceleration
and limiting braking, it’s
estimated that road users
can drastically reduce their
fuel emissions.
See the RAC’s Easy on the Gas report
for more (www.racfoundation.org)
GEAR UP
7
Air conditioning
increases fuel use at
all speeds. If travelling at low
speeds (less than 40mph),
open the windows instead
– it’ll save you more.
Excessive weight
such as roof racks and boxes
increase both drag and fuel
costs. By removing them,
motorists can save as much
as 20 per cent on fuel costs.
*2014 NEW CAR CO2 REPORT, SMMT
1
10
TAKE AN ECODRIVING COURSE
At the Institute of
Advanced Motorists’ (IAM)
Ecolution lessons, you’ll
learn how to save fuel
through some ‘defensive
driving’ techniques.
Visit www.iam.org.uk/eco
German industrial group Siemens is one of the world’s largest
engineering and electronics firms. In the UK, it employs nearly 14,000
people and has a fleet of 4,500 vehicles (of which 3,500 are cars and
1,000 are commercial vehicles).
Siemens wanted to reduce the cost of running this fleet, plus
improve service delivery to consumers. But how could it achieve this
while adhering to its sustainability agenda?
Siemens asked Lex Autolease to look at how things could be done
differently within its light commercial vehicle fleet. This wasn’t just a
matter of looking at direct costs such as fuel and leasing, but also
indirect factors such as productivity being affected by having the wrong
vehicle visit remote sites in bad weather. Taking a holistic stance,
Siemens consulted workers across the business.
The upshot was that the fleet now employs a narrower range of
vehicles. To accommodate changes in working practice, there was also
a significant downsizing of vans too.
As a result, fuel consumption has been reduced, leasing costs have
been lowered, while vehicle utilisation has improved, with Siemens
making substantial savings over the lifetime of running the vehicle.
“Lex Autolease asked us some searching questions, which led us to
question what we did and how we worked,” says Paul Tate, commodity
manager at Siemens. “Involving people from around the business, on
a consensual basis, enabled us to ensure that these sometimes radical
changes to vehicles and working practices were more readily accepted
by the business. I would advise people not to be afraid to ask for
outside help and to work with suppliers in partnership.”
FEBRUARY 2015 DIRECTOR 9
Business wisdom
All you need
to know
You can save
money by leasing
lower-emission
vehicles”
Want to find out more about cashflow-friendly leasing?
Lex Autolease has the answers
■ WHO IS LEX AUTOLEASE?
The UK’s largest vehicleleasing business, responsible
for one in every 33 new car
and van registrations made
nationwide. Having bolstered
British business since 1958
by leasing company cars, Lex
Autolease manages over
280,000 vehicles, assisting
over 6,000 home-grown
enterprises in the process.
■ HOW CAN SMES BENEFIT
FROM LEASING?
Leasing gives you better
control of your finances. You
can budget around fixed
monthly costs with no
hidden surprises or risk of
depreciation. Drive a brand
new car or van of your choice
with optional servicing and
maintenance, road tax,
breakdown cover and
tyres included.
■ WHAT FINANCIAL SAVINGS
ARE THERE?
Monthly lease payments are
typically cheaper than
10 DIRECTOR FEBRUARY 2015
even has a dedicated ‘green’
team, which can give you an
environmental analysis of
your fleet, dispense practical
advice on improving your
eco performance, as well as
suggesting how your
company’s cars can reduce
their mileage.
repaying car loans, so your
cashflow is likely to be
boosted as a result. Indeed,
it’s estimated that the average
SME-owned vehicle
depreciated by more than
£10,000 over eight years, the
average age of LCVs in the
UK. SMEs are missing out on
growth opportunities because
they have almost £6.7bn tied
up in commercial vehicles
sitting on their balance sheets
as a depreciating asset.
■ HOW DOES LEASING CARS
WITH LEX AUTOLEASE WORK?
■ WHAT ARE THE CO2
EMISSIONS OF LEX AUTOLEASE
CUSTOMERS' VEHICLES?
The average CO2 of Lex
Autolease’s car fleet is
123.8g/km – an improvement
on 2012, when it was
140g/km.
■ DOES LEX AUTOLEASE
OFFER ECO-FRIENDLY CARS?
It has 4,391 hybrid vehicles,
which includes a plug-in fleet
of more than 700 vehicles.
These span plug-in hybrids,
extended-range electric
vehicles, plus Renault Zoe and
Kangoo ZE electric vehicles,
both on contract hire.
■ AREN’T LOWER-EMISSION
CARS GENERALLY MORE
EXPENSIVE?
Not at all. By leasing lower
emission vehicles, you
can actually save yourself
some money. As well as a
more economical fuel bill and
road tax, you’ll have less
company car tax to pay too.
This company car tax is
calculated by multiplying the
car price by five to 35 per
cent (depending on the
car’s CO2 emissions). Plus,
cars with zero emissions
(such as electric cars) aren’t
taxed at all.
■ DOES LEX AUTOLEASE
PROVIDE ANY OTHER ‘GREEN’
SERVICES?
A pioneer of ‘green’ fleet
solutions, Lex Autolease has
a vast repository of hands-on
experience and expertise. It
Leasing a car from Lex
Autolease couldn’t be easier.
All you need to do is check
the prices and vehicles at
leasing4business.co.uk,
then select your vehicle,
mileage and contract period
(which lasts from two to five
years). Afterwards, Lex
Autolease will supply a quote.
After credit approval, the
company will order your
vehicle before delivering it
to your door.
■ WHERE CAN I FIND OUT
MORE ABOUT LEASING?
Discover more at
leasing4business.co.uk or call
0800 012 1234.
FEBRUARY 2015 DIRECTOR 11
BUSINESS IS
LOOKING GOOD
Talk to Lex Autolease about how your business can
benefit from better vehicles for less than you may think.
Get a quote today:
CALL: 0800 012 1234 VISIT: LEASING4BUSINESS.CO.UK