Is a Hybrid Electric Vehicle suited to a high mileage lease?

Launched with mind-blowing economy and emission figures, the Outlander PHEV appeared to be the answer to so many drivers ideal car. With more and more hybrid electric vehicles being launched by BMW, Mercedes, Audi and VW to name but a few, some drivers have called into question some of the claims of fuel economy and savings.

 

Golf mark 7 at CarLease UK

Low company car tax:

Because of its emissions, the savings offered to a company car driver by the PHEV are fabulous. Although the emissions are calculated using the initial mileage on electric only, company car drivers can rely on the published figures to calculate their car tax, whether or not the day-to-day use is different  from the 44g/km. Even on 2015 company car tax rates the PHEV will only be taxed at 5%

Over 100 mpg ?:

With economy figures of better than 120mpg, the PHEV appears to offer enormous savings on your fuel bill. But in order to achieve anything like this, the car has to be plugged in and fully charged, driven on electric only until the battery is flat and then at a steady 56 mph on a relatively flat road. Our own customers and averages across online reviews suggest a real life average figure of about 47mpg. Great for a 4×4 but don’t confuse the PHEV with a Mercedes ML or X5. The rivals to the PHEV are cars like the  Skoda Yeti, the VW Tiguan, the Range Rover Evoque.  Our own Yeti averages 48 mpg in general use and our last Tiguan 47mpg.  Given that a hybrid car is a more expensive leasing option for a company car, a non hybrid may be £60 a month cheaper or 5000 miles a year free fuel. But factor back in company car tax savings and it will more than make up for this so you pay your money and take your choice, but clearly the advantage of the hybrid is lost as you cover high mileage with your lease car.

 

Should you have Range anxiety?:

With a plug-in electric hybrid like the PHEV, the range of your car is not limited as the engine takes over once electric power is depleted. But, as you travel longer distances, the hybrid advantage reduces and so does your average fuel consumption.

 

Does Hybrid Electric suite all drivers?:

If you, like me, have a commute to work that is less than 15 miles each way, then you will benefit from the PHEV’s electric only range of 33 miles. In that case you will be ideally suited and live happily ever after and could average fuel consumption of around 100 mpg. But that does not fit the profile of a high mileage lease car driver who will spend their time flying up and down motorways at high-speed.

 

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Should you lease your company cars that cover high mileages

It goes without saying that you will pay more for your lease car when it will cover more miles. Buying or leasing, the more miles you cover, the more the car will depreciate

So how best can you protect yourself

If your high mileage lease car is taken out on a maintenance contract, then your routine services costs and tyres including punctures are covered. If you have a warranty issue, you get the full backing of Carlease UK along with the funder who are providing the maintenance and buy thousands of cars a year from the manufacturer. In other words, you get to keep your cars moving

Captur

You will also know the period that you have the car for, 2,3 or 4 years. If your cars are going to cover high mileage, then you want to keep them safe for your staff so we will help you chose an appropriate term. Again, including maintenance, along with your own structure of safety inspecting, will ensure your cars are safe and you adhere to your duty of car

What do we need to know to quote for your high mileage lease car?

Firstly, business contract hire for a high mileage lease is finance based and as such we will want to know about your company. This will take the form of a finance proposal

We will need to know how long you want to keep the car for, how many miles a year you want to cover,what initial rental you want to pay and whether you want to include maintenance in your contract

What about Eco and Hybrid Electric cars ?

Mitsubishi Phev

In any hybrid or electric cars case, there is always an optimum mileage for it to be worth owning.  For example, the Mitsubishi Phev  looses much of its advantage as a hybrid electric car if it is used up and down motorways and covering 20,000 miles per annum. At a higher mileage, it spends more time running on its petrol engine than battery or hybrid power, as a result the average fuel consumption reduces.

 

 

Is petrol making a comeback against diesel ?

With the advent of quieter, more drivable and quicker diesels, petrol is now the second choice. With the obvious exception of petrol hybrid cars, fleets have shunned petrol powered cars completely. This may be changing, with smaller turbo petrol engines that are nearly efficient as a diesel. Now then, nearly as efficient? Well the new Ford three cylinder is just that in the case of the Focus and Fiesta, and with petrol being cheaper than diesel, the running costs are almost identical

Ford Fiesta

If you include P11D and Co2 emissions in the calculations, petrol begins to pull ahead. With car tax being lower for the efficient petrol, small petrol engines really are going to eat into the diesel market. But its more complex than simple numbers, petrol servicing intervals are longer, they warm up faster and are generally a little quieter

So, what cars are include?

VW have for a long time produced their FSi engines, smaller, very efficient petrols that will this time next year have technology that shuts off cylinders in certain circumstances

The 1.2 litre version is used in the Skoda Yeti and our customers tell us that it is cheap to run

Ford have the 1.0 Ecoboost engine, the engine of the year for two years running. In 100bhp and 125bhp form, it’s a gem of an engine and we have one on our fleet. Ford have already started to run 1.2 versions of the engine in the 4×4 Kuga, with great results

What about vans?

Ford are already using the Ecoboost engine in the Fiesta van and with the gap between diesel and   petrol costs widening, the Fiesta van will undoubtedly get market share. What is really exciting is the larger version of this engine being used in the Transit Custom

Telematics will completely change insurance and monitoring of business lease vehicles

Looking much like an APP that we are all used to,app store DrivePlus is the first to the market with a multi-function phone based piece of software that will be useful to companies operating vans or cars and also private drivers who are willing to be monitored to reduce insurance costs
 
Starting with vehicle trackers for theft recovery the motor industry has scratched its head for ever more functionality of the location systems available with a phone chip. As phones have acquired gps and added this to the already set up location systems that use phone aerial masts, the options available to a fleet manager have increased by the week
 
Hot on the heels of trackers were black box recorders that enable young drivers to prove their driving is limited and sensible 
Now, simply installed on an iphone, tracking and recording are being used as a basis for a massive increase in telematics.  Insurance savings are now being offered to adults as well as young drivers, using a simple Bluetooth sender from the OBD2 (On Board Diagnostics) unit of all cars and vans, the phone also monitors the fuel consumption and emissions of a vehicle. From a fleet management point of view, this will simplify the servicing of business cars, with the ability to forward plan maintenance and tyre replacement. Company cars covering large annual mileage of course have a more complex maintenance and tyre replacement schedule than those with more normal mileage.  In a high mileage leasing environment, anything that helps organise the schedules will be welcome. 
Private mileage and business mileage disputes will be a thing of the past with the PC based software having the ability to calculate mileage payments due to staff automatically 
Van insurers are offering discounts for use of their own apps to allow monitoring of driving styles. This will add the ability of the company to locate a van for delivery, security and logistics 
If systems like this become the norm, then insurance claims arguments will almost be a thing of the past. There will be no argument about who was doing what speed and  Whose fault was it accelerometers built into phones will record sudden acceleration or deceleration and its direction. Whiplash fraud will all but disappear.  At a Summer conference, an underwriter from one of the biggest insurance companies pointed out that if 80% of drivers with smartphones had a similar APP, premiums would reduce by 40% with no change to cover
One last proposal around the corner is a reverse telematics. With the involvement of the manufacturer of the engine management system, cars and vans can be optimised for their use by mapping via the OBD2 based on the use profile of that vehicle. From an emissions point of view, this is a big step forward

If your company cars cover a lot of miles each year, consider high mileage leasing

Anetic Aid  have for 26 years supplied hospitals with operating theatre equipment to the highest standards. When they needed a new car, they chose to lease a new BMW 520d SE from Carlease UK.

The car is going to work hard and will cover 35,000 each year, a mileage that many lease vehicles will cover in a three-year period.

So, when a company needing a new car that will cover a higher mileage than average  is considering funding methods, why would we recommend high mileage leasing 

BMW 520d SE from Carlease UK Anetic Aid needed to know how much their car would cost each month. If you buy your car, then your depreciation is completely unknown until you sell it at the end of its three or four years, lease it and your cost is fixed, including maintenance and tyres if you include them.  One number is all you need to arrange your servicing and any tyres that you need and in most cases the car will be picked up and dropped off again.

 You choose the car, the annual mileage and the term that you keep the car for. All of these can be varied to arrive at your ideal budget. If you are VAT registered, then you can claim back some of the VAT on the payments.

During the life of your lease car, you have as a company a responsibility to ensure that it is serviced and maintained so that it is safe to use. With optional maintenance included, your servicing schedule will mostly achieve the standards that are expected to adhere to, with a few safety checks added in, your staffs cars will be safe.White 5 Series Anetic Aid 2

At the end of a high mileage lease, your car is picked up and you have to deal with one person, who inspects it prior to going. No haggling  no tyre kickers, no arguments, no dodgy payments.

For us to achieve your ideal deal, this is what we need to know:How long do you want it for?, between two and four years. How many miles per year do you need to cover?. What is your ideal initial payment?. Do you want us to include maintenance in your price.

FORD Transit Custom Sportvan, Ford roll out a bling van once again

The Transit Custom is a great drive, Ford really have done a superb job. But, van leasing options are not always as sexy as the new Sportvan.  It has been launched at a lower price than its competitors and with superb future values and great supply prices, the Sport is going to be a run away success.

Vanlease UK Ford Transit Custom Sport

Transit Custom Sport

Many van manufacturers have brought new, sporty vans to the market and they have been a success. There seems to be a standard set up and that includes alloys, stripes and sporty exhaust. The Transit Custom is no different.

If you are going to spend all day in a van, lets say in a high mileage lease, then this is the way to go.

Interior of the Custom

 

Ford have sat the Sportvan on 18 inch alloys, running on low profile tyres. They have included colour coded bumpers and a body kit.  Over and above many rivals, Ford have included a camera, a trailer hitching system, a lane-keep system, foglights, cruise control, air-conditioning, heated screen , ESC and ABS.

New alloy wheels for the Ford Transit Custom

What Ford have not done is changed the engine and in truth I would rather they didn’t. The Mercedes-Benz Vito with 225bhp and the VW Transporter with 180bhp don’t benefit from the extra power, the Sportvan still drives really well and it is 155bhp after all.

The Sportvan of course maintains all the sensible and well thought out touches that the standard van has, such as a 12 output on top of the dashboard for your sat nav and carriers for multiple bottles. This van also has the best mirrors of any van that I have driven. They are rock steady and really big.

What helps swing the Ford in my eyes is this, it is 10% more economical than the VW Sportline and 20% more economical than the Mercedes-Benz SportX, the VW is £3995 more than the Ford and the Mercedes is nearly £8000 more.  Ford wins hands down.

 

VW Golf Mark 7 Bluemotion, sounds like a Golf, drives like a Golf, it’s a perfect high mileage lease car

VW have a well-developed  range of  Bluemotion products. Its their  economy department and over the last five years has rolled out some fantastic car, much-loved by the high mileage leasing drivers. The new  Mark 7 Golf  Blue Motion, the latest from the fold,  is most economical Golf that they have ever produced.  Not only have they improved build quality but they now have a diesel, not a hybrid, that has an emission figure of 85 g/km  and an average economy of over 88 mpg. Even as a person lease car, this car has got to make sense. 

Broadly speaking it is capable of  close on 1000 miles on one tank of fuel and  for business use, time spent at the pumps is down time.

Just a 1.6 litre? 

The latest derivative of the 1.6 diesel is now 110 bhp and even though so economical, goes well and will do over 120 mph.  The car is quiet to drive and  taught as a result of being lowered slightly. It is over 60 kg lighter than its predecessor but more powerful and aerodynamically better, wind noise is negligible, a result of the aerodynamics. VW have added start-stop and battery regeneration charging. It sits on low rolling resistance tyres, which although noisier, save fuel.

Unbelievable tax rates. 

As a 40% tax payer this car will only cost you £87.92 a month. The road fund licence is zero, the same as most hybrids but you get to drive a Golf.

Ford enters the hybrid market with the new Mondeo and aims to retake the fleet market

The 2014 Mondeo

Two new hybrid versions of the soon to be announced Mondeo will make up part of the line up. A regular hybrid and a plug in that will be called Energi. The Energi version is hoped to have emissions of less than 50g/km CO2 which undercuts emission requirements in Europe for several years to come. As a company car, the benefit in kind advantages of such emissions and its economy of over 80mpg are going to make the new Mondeo a strong contender. As a high mileage lease vehicle, figures like these will put it head and shoulders above the alternatives.

First tests of the standard Hybrid have reported real life use consumption of better than 65mpg and emissions of less than 98g/km CO2.  Yet, the combination of a strong 2.0 petrol motor and the electric drive give the Mondeo a sporty feel in a well sorted chassis. The Energi is a heavier car as it has a larger battery to allow for a 20 mile range on battery only following a plug in charge.  As emissions are an average of mixed basket use, the 50g figure is a fair representation.

 

Expect the new Mondeo at the end of 2014 with launches during the year. This is as much as a year behind schedule, due to factory disputes and production being moved.

 

Other additions to the engine range will be a 1.5 litre ecoboost petrol with two litre performance.  We expect the 1.5 to have better economy and lower CO2 figures than the engines it will replace. Ford have not committed to whether the 1.0 Ecoboost engines will be used. In a Focus of similar mass, the engine is strong but marketing remains an issue.

 

One confirmed diesel has caught the eye already, a four-wheel drive with a dual clutch six speed auto. To commit to a model of this spec so early in a launch is unusual.