Switching to greener company cars could save £3bn

Businesses could collectively save almost £3 billion a year if they switched to ‘greener’ company cars, according to a new study.

Research carried out by independent environmental organisation the Energy Saving Trust has found that following the introduction of new Government tax breaks at the start of the 2008/9 financial year, if UK companies all choose vehicles with 120 g/km or fewer carbon dioxide emissions there could be:

The findings form part of the EST’s new report, ‘Behind the Wheel II’. The study of 400 board-level executives at organisations across the UK found that only 7% of companies offered a financial reward to employees to choose a smaller, cheaper or lower carbon vehicle.

In addition, more than half of companies (51%) that provide cars do not have a corporate social responsibility (CSR) or environmental policy. And of those that do, only one third consider the environmental impact of the vehicles they provide.

The launch of the report forms the centrepiece of an EST campaign to encourage businesses with company car fleets to consider their impact on the environment.

With more than half of all new vehicles registered in Britain being company cars, Nigel Underdown, the EST’s head of transport advice, has called on organisations across Britain to act now and ‘green’ their company car fleets.

He said: “The reasons are there for all to see: running vehicles costs a lot of money and with fuel prices over £1 a litre it’s not going to get cheaper any time soon. In addition, companies in the business-to-business sector won’t get far when tendering for big contracts unless they can prove their environmental credentials.”

With tax breaks now available for driving cars that produce 120 g/km of CO2 or fewer, someone driving an average company car with emissions below that figure could see their tax burden cut in half.

Mr Underdown said: “I predict that 2008 will see a tipping point where offering - and choosing - low-emitting cars is the only sensible business option.

“120 g/km really is the magic number as far as people responsible for managing UK car fleets are concerned: implementing a green fleet policy could save an organisation with 50 cars up to £45,000 every year.”

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