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VEHICLE FLEET MANAGEMENT: WHAT ARE THE COSTS OF YOUR FLEET?

VEHICLE FLEET MANAGEMENT: WHAT ARE THE COSTS OF YOUR FLEET?

It is essential to be aware of the costs associated with your vehicles if you want to implement an optimal vehicle fleet management policy. However, few companies have a precise knowledge of the costs inherent in managing their vehicle fleet.

A distribution of costs to be taken into account in your fleet management

The most important cost to consider in your vehicle fleet management is the cost of owning the vehicle. It is about 40% of the total cost of your vehicle. In the case of a rental or leasing, this cost is represented by financial rents. If the vehicle is financed directly from the company’s cash flow (purchase), then this is called depreciation.

The second most important cost is between 15% and 30% of the total expenses generated by your fleet; it is the fuel cost. This cost varies according to the number of kilometres travelled by your vehicles during their service life.
The cost of insurance represents about 9.5% of the total cost of your fleet. It is composed of the total amount of your contributions plus the amounts paid for any deductibles.

Maintenance and servicing represent 7% of the total cost of your fleet of vehicles. It is made up of the costs of interviews spent as expense reports by users and interviews invoiced by third party companies with which your company may have a centralisation contract. In some cases, maintenance and servicing can be internalised, so it is necessary to calculate the manpower and material resources allocated to this position. In the case of a long-term lease, 81% of the contracts include a maintenance package.

Taxes represent about 6% of the total cost of your fleet. This cost is made up of the bonus/malus on the purchase of the vehicle and the corporate vehicle tax (TVS), which is weighted by the vehicle’s CO2 emission rate and paid annually. It should be noted that certain vehicles running on clean energy can benefit from an exemption from this tax.

There are still 2 items of expenditure that are often overlooked in the calculation of the cost of a fleet of vehicles:

Social charges related to the declaration of benefits in kind (which can represent up to 8% of the total cost of your fleet!) as well as the amount of taxes paid on a portion of non-deductible depreciation (about 3.5% of the total cost of your fleet). It should be noted that the trend is upward regarding the ceiling of deductible depreciation for low-polluting vehicles.

The costs of vehicle fleet management

Vehicle fleet management is in itself a source of expenditure to be considered when calculating the cost of your fleet. It is necessary to take into account the human resources involved in the management of the vehicle fleet: fleet manager and accounting for example. It is also necessary to consider the implementation of PV management or fuel cards. A dedicated computer system is also strongly recommended to centralise the data, circulate and analyse it. The acquisition of a software solution can take two forms: a license purchase to which must be added an annual maintenance and support cost or the payment of a monthly rent including the use, maintenance and hosting of the software.

The software, an ally of choice in corporate fleet management

As you will have understood, managing your company’s vehicle fleet requires a thorough and complete knowledge of the expenses related to your fleet. Adapted software can strongly help you to anticipate, optimise and analyse these costs.

At hitechsoftware, we have been developing solutions dedicated to the rental and fleet management business for more than 30 years. Thanks to our experience, we offer a specialised expertise and a unique support to each of our partners. The stability of our teams and our constant investment in R&D bring a new dimension to the management of our solutions for users.

You can contact us here if you would like us to study together the solutions available to you in order to develop your business.