5 Costly Disadvantages of Company Vehicle Programs

In these digitally driven times, the fact that many companies still hand an employee a Vehicle Mileage Log is a testament the simplicity of that humble document. Five columns: date, starting mileage, ending mileage, miles traveled and purpose. And while now there is a better way, too many organizations try to overthink employee transportation and give their employees access to company cars. Company vehicle programs have a five-column ledger all their own that add up to wasted time and money.

1. Ownership/relationship costs. Everywhere we look these days, someone is trying to make buying a car a more pleasant experience. They give us the option to buy online, no-haggle pricing, or pricing data so we can haggle better. But car-buying is stressful largely because of the dollars involved. For most of us, this is a big purchase. Now imagine buying five cars, or 50, or 500. Of course you can lease cars, but now you have yet another vendor to evaluate, manage, and, sometimes, replace.

2. Maintenance costs. Whether you buy or lease cars, there are costs related to maintenance. And the question always looms: To whose satisfaction is the car maintained? The leasing company’s? The fleet manager’s The employee’s? Yours? Is that a job you want?

3. Vehicle access hassles. Lots of employees see a company car as a perk, so it’s almost certain you’ll have fewer cars than you have people who want them. Who decides and based on what? Inevitably some employees will find fault with the vehicles and the rules around them. Company cars are a magnet for workplace conflict and controversy. Isn’t part of a leader’s job to eliminate those?

4. Costs of weekend, occasional driving. Some people drive company cars all week and drive them to death on weekends. Some park them in the driveway and don’t use them much at all. Either way, the company’s cost is out of line with value received by the business.

5. Increased liability. When someone in a company car causes an accident, who pays? What if they were doing something they shouldn’t have been doing? Who pays then? What prevents a plaintiff from suing you even if you’re not liable? As we’ve seen, absolutely nothing. These questions alone should make any employer think hard before starting a company vehicle program.

Stick with mileage reimbursement, but automate it.

So should you keep ordering those Vehicle Mileage Logs? Not for long. Automate the mileage reimbursement process, and do it in a way that speeds payments to employees while driving down costs for your organization.

SureMileage by CompanyMileage provides employers with a secure and accurate system for employees to manage mileage reimbursement. Rather than verifying the miles that were driven, SureMileage calculates the expenses to be reimbursed. Employees report their starting point and destination and the system calculates the driving distance between them.

Automated mileage tracking virtually eliminates the inflated estimates commonly seen in traditional odometer readings. Point-to-point reimbursement also eliminates side trips from the reimbursement equation. But perhaps most importantly, CompanyMileage helps you avoid the company car.