How to choose a company car for your employees

Providing a company car is a popular employee benefit in the UK. Around half of all new car registrations in the UK each year are for company car fleets.

As an employer, choosing the right company cars for your employees requires balancing factors like cost, employee satisfaction, and your company’s environmental goals. Follow these tips for selecting company cars that meet your needs:

Consider employee needs and desires

Think about your employees’ driving requirements and personal preferences when choosing company cars. For example, employees with longer commutes or who frequently drive to meetings may appreciate a comfortable sedan or SUV.

Those who need to transport equipment may need larger vans or trucks. Consulting employees directly about the features they want in a company car makes it more likely they will enjoy the vehicle.

Compare operating costs

Operating costs like fuel, maintenance, tax and insurance can vary dramatically between models. Opt for vehicles with good fuel economy to save on petrol or diesel. Factory warranty coverage and fixed price servicing plans keep maintenance costs predictable. Company cars in lower tax bands reduce tax liability for businesses and employees. Review total operating costs, not just upfront purchase prices, when deciding between vehicles.

Review safety ratings

Employee safety should be a top priority. Review safety ratings from organisations when comparing vehicles. Modern driver assistance features like automatic emergency braking and lane keep assist can help avoid accidents. Prioritise models with high crash test scores and advanced safety technology.

Consider the environmental impact

There’s no better solution, than a free solution. Companies across the UK are looking to reduce their carbon output, hit increasingly stringent CSR targets and boost sustainability initiatives. Cue the humble company car. Thanks to their low running costs, tax benefits, and impressive performance – EVs make excellent company vehicles.

By electrifying employee’s cars, businesses can drastically reduce their corporate carbon output and save their employees thousands on an electric car. offers a salary sacrifice scheme which is completely free for businesses to implement and run. It makes electric cars affordable for their staff base by slashing the monthly lease cost by 30-60%. Drivers can save money while enjoying the smooth, quiet performance of a modern electric car. Businesses get to drastically cut their Scope 3 emissions for free. It’s a win-win.

Choose flexible contracts

Consider company car contract hire, personal contract hire, or salary sacrifice schemes rather than outright purchase. Contract hire lets you set mileage limits and upgrade vehicles regularly to stay current. Salary sacrifice reduces costs for employers and employees by deducting payments from pre-tax income. Flexible leasing terms tailored to average employee tenure work better than long purchase loans.

Offer different car levels

Provide a choice of car models appropriate for employees’ roles and seniority. Offering desirable higher trim models as rewards for top performers can improve motivation and retention. But beware of overspending on executive cars that strain budgets. Find the right balance of flexibility and affordability across all employees.

Choosing company cars requires balancing many factors – employee needs, costs, sustainability, and more. Following these tips will help you make the best choices to benefit your business and employees. Taking the time to find the right mix of vehicles improves employee satisfaction, simplifies administration and demonstrates your employer brand values.