The Best Car Finance Blog In The World

Early terminations and contract extensions from fleets and company car drivers are being reported by leasing companies as job losses increase.

Over the past three months, the number of people claiming out-of-work benefits (job seekers allowance and low income benefits) has more than doubled, reaching 2.7 million in July, according to the Office for National Statistics (ONS).

The latest data also shows more than three million people were still furloughed as the Government scheme begins to wind down.

The ONS says that more than one-in-10 workers (12%) were, effectively, having their wages paid by the Government between late July and the middle of August, a 50% reduction on May’s figures.

Unsurprisingly, the highest number of furloughed staff were found in those companies yet to re-open – almost three-quarters of staff (71%) compared to 11% at those businesses back trading.

The scale of the downturn is unprecedented. The UK economy is now 17.2% smaller than it was in February 2020.

Furthermore, Quarter 2 2020 is now 22.1% below Quarter 4 2019, which is more than three times greater than the total fall during the next largest period of recession, which occurred during the global economic downturn of 2008 to 2009.

The Bank of England has warned that UK unemployment is expected to peak at 2.5 million by 2021, with more than a million jobs expected to be lost in the second half of this year.

It highlighted what it called the “considerable uncertainty” remaining about the prospects for employment after the furlough scheme finishes in October.

WINNERS AND LOSERS

Paul Hollick, chairman of the Association of Fleet Professionals (AFP), said: “Some companies have taken the bit between the teeth by introducing redundancies quickly, but they were already on shaky ground, with plans already in place.”

However, he explained there have been “winners and losers” as a result of the pandemic, with those in the hospitality and travel sector hit particularly hard, while anything that is digitised and can create online services and solutions is able to tap into growing demand.

The amount of money spent online increased by 61.9% in June when compared with February, ONS data suggests. This has resulted in an increase of £943.5 million in average weekly sales from £1.5 billion in February to a staggering £2.5bn in June.

Courier fleets have been among some of the biggest winners, with DPD announcing it was recruiting 6,000 new staff, including 3,500 drivers, in response to the unprecedented boom in online shopping.

The delivery firm is investing £200m this year to expand its next-day parcel capacity, including £100m on vehicles, £60m on 15 new regional depots (10 more than originally planned in 2020) and the remainder on technology.

The new jobs will include delivery and HGV drivers, warehouse staff, management positions and support staff, including mechanics.

CEO Dwain McDonald said the business was experiencing the “biggest boom in online retailing in the UK’s history”.

It is a similar story at APC, with 100 new roles available, all of which will be permanent positions, including drivers, warehouse operatives, customer services staff and IT.

The courier firm’s chief executive, Jonathan Smith, explained that the past five months have seen “unprecedented demand” for its delivery services.

For firms facing a more uncertain outlook, Hollick believes business owners and operators do not know what to do in terms of “rightsizing their business”.

He explained: “No one really understands the total impact yet, because everything is being propped up (by the Government), but I wouldn’t want to be an account manager at this time.

“The way that you operate with customers is going to fundamentally change post-Covid. I think it’s going to be a case of sitting in an office or at home to do an account review rather than face-to-face.”

EARLY TERMINATIONS

Account management and sales teams would, typically, be out on the road, potentially covering long distances to visit their customer base on a regular basis.

But lockdown has shifted customer meetings online and, with obvious productivity gains, returning to pre-pandemic working practices is not on the cards.

Volkswagen Financial Services Fleet reported it was seeing “no demand” from customers for a return to face-to-face meetings. Head of sales and marketing, Tom Brewer, said: “We’re seeing a desire to continue with remote meetings at the moment.

“In our experience, this approach doesn’t seem to have any detriment to the quality of the conversations or the effectiveness of the meetings. There are upsides for all parties – aside from minimising the risk to everyone’s health – in the productivity benefits for us and our customers; meetings tend to be shorter and there is no fuel cost and no time lost to travel.”

It is not planning a reduction in headcount, but elsewhere companies looking to tighten their belts are recognising that they can do more with less.

As a result, Hollick expects the traditional company car market will shrink due to the significant job losses already being seen and those yet to come as the furlough scheme ends.

Furthermore, he says other employees, who qualified for a car due to the amount of annual mileage they covered, face having the benefit removed due to now not hitting the required threshold.

Three-quarters (74.8%) of fleets told Fleet News in a recent survey that they expect greater use of video conferencing in the long term, while almost 61% expect to see average mileages fall. And more than a third (35.8%) said that they expect to be running fewer company cars in the future.

Alphabet has reported an increase in early terminations and reschedule requests in recent months, driven predominantly by individual and small-to-medium enterprise (SME)customers.

However, Gavin Davies, Alphabet’s general manager for customer relationship management and public sector, said: “We are seeing bulk early termination requests from some of our corporate fleets as well, but they are also utilising other options, such as putting new car orders on hold while they assess their individual situations and future fleet needs.

“This has been the case particularly in those industries that have been hit hardest by the lockdown or still have staff on furlough.”

He added: “As the furlough scheme has given an artificial stimulus to current demand, we do expect to see an increase in early terminations as the scheme comes to an end in October.”

Matthew Walters, head of consultancy and customer data services at LeasePlan UK, says contract extensions have increased by approximately 50% above average. “Many businesses are also increasingly interested in the efficiency savings gained by outsourcing their operations and fleet activity.”

Jon Lawes, managing director of Hitachi Capital Vehicle Solutions, told Fleet News that sales teams were particularly impacted by a lack of travel. “We’re seeing customers looking to reduce their contract mileage moving forward, meaning that policy benchmark mileages have reduced by approximately 10% across certain customers,” he said.

The greatest impact has been in the retail sector, with job losses resulting in company car numbers being cut.

“The headcount and vehicle allocation for retail store area managers has reduced as a result of companies streamlining their middle management to respond to the economic impact of the virus,” said Lawes.

Since March, Lex Autolease has granted payment holidays to more than 3,000 customers, from small fleets to those with thousands of vehicles.

Mileages have also been amended to encourage rental cost-savings and existing vehicles redistributed. As a result, Andy Barrell, head of business development at Lex Autolease, said: “We’re not seeing mass vehicle terminations across our customer base.

“Customers are naturally more inclined towards short-term agreements when there is ongoing uncertainty, so it’s no surprise we’ve seen an increase in demand for short-term daily rental, alongside our informal extension agreements – giving customers more time to assess future requirements.”

The total number of new cars registered to fleet and business so far this year is 45.3% down year-on-year, with 433,868 units registered in 2020, compared with 792,091 in the same period last year.

Historic HMRC data shows a declining pool of company cars, with 890,000 employees receiving the benefit in 2017/18, compared with 940,000 the previous year.

Officials blamed the dramatic decline on reporting issues leaving some vehicles unaccounted for, but the figures for 2018/19, in the coming weeks, are still expected to show a downward trend.

Hollick, however, is predicting leasing firms and carmakers could benefit from a renewed interest in salary sacrifice. He explained: “A few big fleets have already mentioned to me that they are relaunching salary sacrifice schemes to take advantage of the low rates for electric vehicles (EVs). But it’s going to be a fascinating market and I don’t think anybody will know the true impact until the start of next year.”

Hitachi Capital’s Lawes says employees are concerned about the long-term economic impact of Covid-19 and committing to a company car contract, with some perk schemes affected.

That being said, he also sees the renewed potential of salary sacrifice. He told Fleet News: “Now is a prime time to take a salary sacrifice EV with 0% BIK charges.”

Although Alphabet has seen an increasing demand to move to cash incentives in recent years, Davies also highlighted the “significant taxation benefits” for companies and drivers who choose to adopt ultra-low-emission vehicles (ULEVs).

“Alphabet has seen a huge uptake in EVs since the 0% BIK rates were introduced earlier this year,” he said.  By Graham Hill thanks to Fleet News

The Chancellor’s summer economic plan introduced a range of measures to help the UK economy recover from the impact of the coronavirus.

The plan, revealed to the House of Commons yesterday (Wednesday, July 8), to protect jobs, help younger workers and encourage spending with measures such as a temporary VAT cut, from 20% to 5%, for the hospitality sector and a restaurant voucher scheme.

However, help for the fleet industry and wider automotive sector, including a potential scrappage scheme, was not forthcoming.

Paul Hollick, chairman of fleet representative body the Association of Fleet Professionals (AFP), said: “The Chancellor’s announcement was all about carefully targeted help for various sectors that are felt to be among the most vulnerable and it is disappointing that none of this support has found its way into areas that are likely to benefit fleets.

“This especially applies to low-carbon transport initiatives but there could also have potentially been aid for dealers, manufacturers and even fleet service support companies, all of which are facing specific problems.

“Given the fast-moving economic and infection situation, we don’t think this is the last time we’ll see him making announcements of this type over the next few months and we remain hopeful that we will be included in future programmes, an argument we’ll be making as an organisation.”

The automotive sector had been hoping for a scrappage scheme, offering money off a new car purchase.

Mike Hawes, chief executive at the Society of Motor Manufacturers and Traders (SMMT), welcomed the Chancellor’s plans to safeguard jobs and encourage consumer spending in some parts of the economy.

However, he said: “It’s bitterly disappointing the Chancellor has stopped short of supporting the restart of one of the UK’s most important employers and a driver of growth.

“The automotive sector has been particularly hard hit, with thousands of job losses already announced and many more at risk.

“Of Europe’s five biggest economies, Britain now stands alone in failing to provide any dedicated support for its automotive industry, a situation that will only deter future investment.

“We urgently need government to expand its strategy and introduce sector-specific measures for UK auto to support cash flow such as business rate holidays, tax cuts, and policies that provide broader support for consumer confidence and boost the big ticket spending that drives manufacturing. Until critical industries such as automotive recover, the UK economic recovery will be stuck in low gear.”

The Chancellor instead offered a ‘job retention bonus’ to encourage firms to retain furloughed staff. The one-off £1,000 payment will be made to employers for every furloughed employee retained to the end of January 2021.

It applies to workers earning over £520 per month, with the cost estimated at up to £9.4 billion.

There is a six-month VAT cut for restaurants, hotels and attractions, from 20% to 5% from July 15 to January 12, 2021.

Food and non-alcoholic drinks in restaurants, pubs and cafes, as well as hot takeaway food will be covered. Accommodation in hotels and B&Bs and admission to attractions such as theme parks and cinemas also affected

The threshold for stamp duty on residential property in England and Northern Ireland will also rise from £125,000 to £500,000. It applies from July 8 until March 31, 2021.

Energy efficiency grants for homes have also been introduced.

In addition, a ‘Eat Out to Help Out’ scheme offers 50% discount for every diner, up to £10 a head, from Monday to Wednesday throughout August.

Support for young workers is to be delivered through the ‘Kickstart scheme’ – a £2bn fund to pay for six-month work placements for 16 to 24-year-olds on universal credit – and grants for training young people.

In terms of infrastructure, more is expected in the Budget, while the Prime Minister, Boris Johnson, has earmarked £100 million for 29 road projects.

Nick Molho, executive director of the Aldersgate Group, said: “Beyond the need to commit public investment to support shovel ready projects and early stage innovation trials, it is critical that the Government puts forward a comprehensive policy plan in the autumn to drive private sector investment towards the low carbon and environmentally resilient infrastructure needed to put the UK on track for its net zero and nature restoration targets.

“Clear policy commitments in areas such as energy efficiency, clean transport and industrial decarbonisation will be vital if the private sector is to do a lot of the heavy lifting to build a competitive, jobs rich, low carbon economy.” By Graham Hill thanks to Fleet News

The Government is being warned a ‘no deal’ Brexit could impact vehicle costs and prove fatal to the wider UK automotive sector.

A recent Society of Motor Manufacturers and Traders (SMMT) survey showed one-in-three automotive employees was still on furlough at the end of July, with up to one-in-six jobs at risk.

The impact of the coronavirus crisis is being felt across the sector, but jobs could also be threatened by the prospect of a ‘bare bones’ or no-deal Brexit, says the UK automotive trade body.

If the EU and UK do not agree a deal by the end of the year, the UK will leave the EU’s single market and the customs union without any agreement on future access from January 1, 2021.

The SMMT wants a full, zero-tariff deal in place by the end of the transition period to give businesses on both sides the chance to prepare.

Chief executive Mike Hawes said: “Before Covid-19, we expected to produce 1.3 million vehicles this year; the pandemic means we’re already looking at scarcely 900,000.

“A ‘no deal’ Brexit would wreak further long-term damage on the sector. Tariffs would add cost, custom duties and complexity, which would disrupt supply.”

The SMMT suggests a ‘no deal’ scenario could see UK vehicle volumes falling below 850,000 by 2025 – the lowest level since 1953. This would mean a £40 billion cut in revenues, on top of the £33.5bn cost of Covid-19 production losses over the period for UK automotive.

“The industry cannot withstand the shock of a hard Brexit,” explained Hawes.

“Covid-19 has consumed every inch of capability and capacity. There is not the resource, the time nor the clarity to prepare.”

Almost all countries in the world are part of the World Trade Organisation (WTO) which regulates international trade. Should the UK leave the EU without a deal, its trade with the EU will be governed by WTO rules.

When joining the WTO, each country negotiates the maximum tariffs it can set on various types of goods. The tariff charged by the EU on imported cars is 10%.

Leaving without a deal would mean UK-built cars facing a 10% tariff cost and vice versa, says the SMMT’s annual UK Automotive Trade Report.

Tariffs would result in a price increase of almost £3,000 on the average UK exported car to the EU, a £2,000 price increase on UK vans exported to the EU and a price increase of £1,800 on cars and vans imported from the EU, if fully passed on to UK consumers.

The report adds that additional customs duties, costs and complexity would significantly disrupt sourcing of parts and components from the EU.

Executive director, business transformation at Ford of Britain, Graham Hoare, said the manufacturer had implemented measures to ensure product is available for fleets.

He explained: “We’ve brought a lot of cars into the UK and have maintained that availability. That’s really important so we don’t have disruption to our supply chains as the change happens.”

But he warned: “A Free Trade Agreement is necessary for the viability of our business. If you think about all the other changes we’re embarking upon… another burden just makes the activities we’re performing in the UK a little less viable.”

JUST-IN TIME

Frictionless trade within the EU has been critical for enabling the UK car industry to develop supply chains that cross EU borders several times.

A separate report, produced by The UK in a Changing Europe on Manufacturing and Brexit, highlights how supply chains have to operate with supreme efficiency, and parts have to be delivered ‘just-in-time’ throughout the day.

As an example, 350 trucks arrive from the EU every day at Honda’s plant in Swindon, bringing in about two million parts. Components arrive from five-24 hours after ordering. The plant is scheduled to close a year from now.

Meanwhile, a typical driveline system produced by GKN, the British-based supplier, incorporates specialist forged parts from the UK, Spain, Italy, France and Germany.

These are assembled at GKN Driveline’s factory in Birmingham and supplied to automotive assemblers in the UK and EU.

The components, assembled drivelines and the final assembled car could cross the English Channel several times, says the report.

It is a similar story for BMW, which assembles engines at its Hams Hall engine-assembly plant near Birmingham.

Engine blocks come from France and are processed at the plant. They may go to Germany for further work before being assembled.

The engine may go into a Mini assembled in Oxford or the Netherlands, or into a BMW assembled in Germany.

“The final car could be sold anywhere in Europe or globally,” the report says. “This close integration and the need for minimal trade friction becomes even more important as most UK car producers operate on very low profit margins (around £450 on a £15,000 car).”

BREXIT TALKS

After a meeting between Prime Minister Boris Johnson and the EU Commission president Ursula von der Leyen last month, both agreed new momentum was needed in negotiations.

Official talks resumed at the start of this month, but ended with the EU’s chief negotiator, Michel Barnier, saying that “regardless of the outcome” there would be “inevitable changes” from January 1, 2021. The next round of negotiations began last week, with no apparent progress made.

The commission has also told member states and businesses to revisit plans for a ‘no deal’ Brexit.

In a press briefing, prior to the SMMT’s annual International Automotive Summit, Hawes insisted: “We must secure a comprehensive Free Trade Agreement that maintains tariff- and quota-free trade. With such a deal, a strong recovery is possible.”

The UK in a Changing Europe report says the potential danger is that carmakers may simply decide that production in the UK is no longer profitable and shift their assembly plants to the EU.

Many manufacturers with plants in the UK also have plants in the EU to which they could move production. Moreover, many of these plants have spare capacity.

“Such relocations usually happen when new vehicle models are introduced, and the decisions about sites are normally taken at least two years in advance of planned production starts,” it says.

‘MULTIPLE CHALLENGES’

Key companies in the UK automotive sector, that account for the bulk of UK automotive production – Nissan, Jaguar Land Rover (JLR), and Groupe PSA (Vauxhall’s owner) – have all planned new models in the next couple of years.

“There is a real danger they will decide to produce them in the EU, not the UK,” says the report. “This would have a knock-on effect on other industries in the UK.”

UK steel, for example, despite not being subject to tariffs itself, would suffer because the car industry would contract, reducing demand for steel.

“Manufacturing matters,” said Professor David Bailey, senior fellow of UK in a Changing Europe.

“Much of the sector has already taken a hit through the Covid-19 pandemic and Brexit risks further disruption for manufacturers which they are keen to minimise.

“A no-trade deal is seen as the worst-case scenario for sectors like automotive given the impact of tariffs. But even a minimal Free Trade Agreement could bring disruption for manufacturers, for example via its impact on supply chains and in terms of regulatory divergence. Whatever the form of Brexit at the end of the transition period, manufacturing faces multiple challenges.” By Graham Hill Thanks To Fleet News

Before providing the latest report I must first warn those who are thinking of joining one of the many class actions against Daimler (Mercedes Benz) over their emissions cheat systems. Read the terms of the class action and make sure that you are not committing to any of the costs should the action fail. I’ll be keeping an eye on things for you as I had 3 Mercedes during the period in question!

Legal claims against Mercedes-Benz for emissions ‘cheating’ in England and Wales have been strengthened following a £1.6 billion settlement in the USA.

London law firm Fox Williams is pursuing claims for Mercedes owners in England and Wales in collaboration with US law firm Hagens Berman, which achieved a payout of more than £560 million for US Mercedes owners.

Mercedes, however, claims the cars sold in America are different to those in the UK.

It is estimated by Fox Williams that up to 1.2 million potential claimants owning (or having owned) impacted vehicles in England and Wales are affected. This includes private owners and businesses, such as fleet operators and hire car companies.

According to Hagens Berman’s investigations, Mercedes used defeat device, similar to the one used by Volkswagen, on its BlueTEC diesel vehicles.

Affected models are alleged to include the A-Class, B-Class, C-Class, Citan, CLA, CLS, E-Class, GL-Class, GLA-Class, GLC-Class, GLE-Class, GLS, M-Class, S-Class, SLK, Sprinter, V-Class, and Vito, built between 2008 and 2018.

Andrew Hill, the Fox Williams partner who is leading the action, said: “Like many members of the general public, I have been shocked at the allegations of deception and fraud made against some of the world’s largest and most prestigious automotive manufacturers, including Mercedes-Benz.  We believe business and private owners in England and Wales will very likely have good claims for the damage caused to them from unwittingly owning or leasing dirty diesels.”

Three other law firms, PGMBM, Leigh Day and Slater and Gordon, are also investigating potential group claims against Mercedes-Benz over emissions.

A spokesperson for Mercedes-Benz Cars UK said: “With regard to the US settlement, the vehicles in question were produced exclusively for the North American market.  The emissions control system of US vehicles differs in comparison to vehicles in Europe both with respect to hardware components and configuration of the control software.  In addition the legal framework and the certification process in the US is different to that in Europe.

“We believe the claims brought forward by the UK law firms are without merit, and will vigorously defend against any group action.”

Daimler AG, the parent company of Mercedes-Benz, was fined more than £700m by German prosecutors in 2019 over the diesel emissions scandal.

It has filed objections against the German Federal Motor Transport Authority’s (KBA) recall orders regarding diesel exhaust emissions and these objection proceedings are ongoing.  By Graham Hill thanks to Fleet News

The Government is being warned a ‘no deal’ Brexit could impact vehicle costs and prove fatal to the wider UK automotive sector.

A recent Society of Motor Manufacturers and Traders (SMMT) survey showed one-in-three automotive employees was still on furlough, with up to one-in-six jobs at risk.

The impact of the coronavirus crisis is being felt across the sector, but jobs could also be threatened by the prospect of a ‘bare bones’ or no-deal Brexit, says the UK automotive trade body.

If the EU and UK do not agree a deal by the end of the year, the UK will leave the EU’s single market and the customs union without any agreement on future access from January 1, 2021.

The SMMT wants a full, zero-tariff deal in place by the end of the transition period to give businesses on both sides the chance to prepare.

Chief executive Mike Hawes said: “Before Covid-19, we expected to produce 1.3 million vehicles this year; the pandemic means we’re already looking at scarcely 900,000.

“A ‘no deal’ Brexit would wreak further long-term damage on the sector. Tariffs would add cost, custom duties and complexity, which would disrupt supply.”

The SMMT suggests a ‘no deal’ scenario could see UK vehicle volumes falling below 850,000 by 2025 – the lowest level since 1953. This would mean a £40 billion cut in revenues, on top of the £33.5bn cost of Covid-19 production losses over the period for UK automotive.

“The industry cannot withstand the shock of a hard Brexit,” explained Hawes.

“Covid-19 has consumed every inch of capability and capacity. There is not the resource, the time nor the clarity to prepare.”

Almost all countries in the world are part of the World Trade Organisation (WTO) which regulates international trade. Should the UK leave the EU without a deal, its trade with the EU will be governed by WTO rules.

When joining the WTO, each country negotiates the maximum tariffs it can set on various types of goods. The tariff charged by the EU on imported cars is 10%.

Leaving without a deal would mean UK-built cars facing a 10% tariff cost and vice versa, says the SMMT’s annual UK Automotive Trade Report.

Tariffs would result in a price increase of almost £3,000 on the average UK exported car to the EU, a £2,000 price increase on UK vans exported to the EU and a price increase of £1,800 on cars and vans imported from the EU, if fully passed on to UK consumers.

The report adds that additional customs duties, costs and complexity would significantly disrupt sourcing of parts and components from the EU.

Executive director, business transformation at Ford of Britain, Graham Hoare, said the manufacturer had implemented measures to ensure product is available for fleets.

He explained: “We’ve brought a lot of cars into the UK and have maintained that availability. That’s really important so we don’t have disruption to our supply chains as the change happens.”

But he warned: “A Free Trade Agreement is necessary for the viability of our business. If you think about all the other changes we’re embarking upon… another burden just makes the activities we’re performing in the UK a little less viable.”

JUST-IN TIME

Frictionless trade within the EU has been critical for enabling the UK car industry to develop supply chains that cross EU borders several times.

A separate report, produced by The UK in a Changing Europe on Manufacturing and Brexit, highlights how supply chains have to operate with supreme efficiency, and parts have to be delivered ‘just-in-time’ throughout the day.

As an example, 350 trucks arrive from the EU every day at Honda’s plant in Swindon, bringing in about two million parts. Components arrive from five-24 hours after ordering. The plant is scheduled to close a year from now.

Meanwhile, a typical driveline system produced by GKN, the British-based supplier, incorporates specialist forged parts from the UK, Spain, Italy, France and Germany.

These are assembled at GKN Driveline’s factory in Birmingham and supplied to automotive assemblers in the UK and EU.

The components, assembled drivelines and the final assembled car could cross the English Channel several times, says the report.

It is a similar story for BMW, which assembles engines at its Hams Hall engine-assembly plant near Birmingham.

Engine blocks come from France and are processed at the plant. They may go to Germany for further work before being assembled.

The engine may go into a Mini assembled in Oxford or the Netherlands, or into a BMW assembled in Germany.

“The final car could be sold anywhere in Europe or globally,” the report says. “This close integration and the need for minimal trade friction becomes even more important as most UK car producers operate on very low profit margins (around £450 on a £15,000 car).”

BREXIT TALKS

After a meeting between Prime Minister Boris Johnson and the EU Commission president Ursula von der Leyen last month, both agreed new momentum was needed in negotiations.

Official talks resumed at the start of this month, but ended with the EU’s chief negotiator, Michel Barnier, saying that “regardless of the outcome” there would be “inevitable changes” from January 1, 2021. The next round of negotiations began last week, with no apparent progress made.

The commission has also told member states and businesses to revisit plans for a ‘no deal’ Brexit.

In a press briefing, prior to the SMMT’s annual International Automotive Summit, Hawes insisted: “We must secure a comprehensive Free Trade Agreement that maintains tariff- and quota-free trade. With such a deal, a strong recovery is possible.”

The UK in a Changing Europe report says the potential danger is that carmakers may simply decide that production in the UK is no longer profitable and shift their assembly plants to the EU.

Many manufacturers with plants in the UK also have plants in the EU to which they could move production. Moreover, many of these plants have spare capacity.

“Such relocations usually happen when new vehicle models are introduced, and the decisions about sites are normally taken at least two years in advance of planned production starts,” it says.

‘MULTIPLE CHALLENGES’

Key companies in the UK automotive sector, that account for the bulk of UK automotive production – Nissan, Jaguar Land Rover (JLR), and Groupe PSA (Vauxhall’s owner) – have all planned new models in the next couple of years.

“There is a real danger they will decide to produce them in the EU, not the UK,” says the report. “This would have a knock-on effect on other industries in the UK.”

UK steel, for example, despite not being subject to tariffs itself, would suffer because the car industry would contract, reducing demand for steel.

“Manufacturing matters,” said Professor David Bailey, senior fellow of UK in a Changing Europe.

“Much of the sector has already taken a hit through the Covid-19 pandemic and Brexit risks further disruption for manufacturers which they are keen to minimise.

“A no-trade deal is seen as the worst-case scenario for sectors like automotive given the impact of tariffs. But even a minimal Free Trade Agreement could bring

disruption for manufacturers, for example via its impact on supply chains and in terms of regulatory divergence. Whatever the form of Brexit at the end of the transition period, manufacturing faces multiple challenges.”  By Graham Hill thanks to Fleet News

Long-term changes to the way people work could result in more employees becoming grey fleet drivers.

As the lockdown is slowly lifted, employers are wrestling with what the ‘new normal’ might entail, including where staff will work in the future.

Millions of employees have been working from home during the pandemic and many expect that, with technologies like Miscrosoft Office Teams and Zoom allowing people to connect virtually, it’s a trend that will continue.

A Fleet News survey showed an overwhelming majority of fleet decision-makers – close to three-quarters (73.4%) – were working from home; one in 10 were dividing their working day between the office and home, and just 15.4% were still in the office full-time.

The latest picture will be revealed in the June digital edition of Fleet News, which will be published next week.

Meanwhile, a separate Fleet News poll suggested that for many, some two-thirds (68.1%) of respondents, working from home will become their ‘new normal’.

Paul Hollick, co-chair of the Association of Fleet Professionals (AFP), warns this could have significant consequences for fleets, with more employees joining the ranks of those that drive their car for work, the so-called grey fleet.

Employers have a legal obligation to ensure that grey fleet vehicles are reasonably safe to use, are fit for purpose and are lawfully on the road.

Companies also typically pay Approved Mileage Allowance Payments (AMAPs) to reimburse fuel used in the course of a work trip at 45p per mile.

“Grey fleet could become a bit of a battleground, because of Covid-19,” warned Hollick. “Employees won’t be office-based (in the future), they’ll be home-based, which means their contract of employment might be changed.

“If the employee is classed as home-based rather than office-based a journey from home to the office will then become a business trip.”

Furthermore, Hollick says that, with people wary of public transport, employees are turning to used vehicles in the sub-£3,000 bracket to stay mobile, which could end up being driven for work purposes. 

New figures from the Department for Transport (DfT) show how hard public transport has been hit. Journeys by national rail are 8% of typical levels and London tube use stands at just 14%.

During the first full day of lockdown (Tuesday, March 24), car use fell to less than half (44%) of the expected level. Light commercial vehicle (LCV) use stood at 55%, HGV use at 84%.

Three months later and the day after retail outlets were allowed to open for the first time on Monday, June 15, car use had risen, but was still only at 70%. Van use and HGV use had grown to 84% and 92%, respectively.

In line with Government advice to avoid public transport, cycling use has doubled during some weekdays and trebled at the weekend.  By Graham Hill thanks to Fleet News

Vehicle thefts have risen to highest level in four years, as more than 150,000 cars, vans and motorcycles were reported as stolen in 2018-19.

It’s an increase of 10,000 vehicles when compared to the year before and a 56% (54,932) increase compared to four years earlier, according to data analysed by RAC Insurance.

All but three of the police forces that responded to a Freedom of Information request recorded an increase in the numbers of vehicles stolen in their force areas from 2014-15 and 2018-19.

The largest increases were recorded by Kent Police (up 12,550 to 40,726 thefts in 2018-19, a 45% increase), Metropolitan Police (up 9,635 to 30,773 thefts, a 46% increase) and West Midlands Police (up 5,677 to 10,372 thefts, a 121% increase).

Six forces recorded a more than doubling in the number of vehicles stolen between 2014-15 and 2018-19, with the biggest jumps in Suffolk (up 172% from 347 to 945 thefts), Surrey (up 133% from 661 to 1,543 thefts) and the West Midlands.

Only Lincolnshire, the City of London and Police Scotland recorded a reduction in thefts during this period, with reductions of 28, 29 and 473 thefts respectively.

Most police forces (32) also recorded a rise in vehicle thefts year-on-year, between 2017-18 and 2018-19. Kent, again, saw the largest rise, as well as the largest number of overall vehicles stolen in 2018-19 (up 2,575 to 40,726 thefts, 7% more than in 2017-18), followed by Essex (up 1,056 to 5,409 thefts, 24% more than in 2017-18) and the West Midlands (up 836 to 10,372 thefts, 9% more than 2017-18).

When looking at the biggest percentage increases over this 12 month period, Suffolk witnessed the highest jump with 44% more thefts (945 in 2018-19 compared to 655 a year earlier), followed by Bedfordshire (37% increase, from 1,056 to 1,445 thefts) and North Wales (32% increase, from 464 to 612 thefts).

RAC Insurance spokesperson Simon Williams said: “These figures paint a rather disturbing picture – vehicle thefts are on the rise almost everywhere, and in some parts of the country numbers are rocketing.

“It’s also not the case that the rises in crime are confined to a few larger urban areas, with many police forces covering more rural areas also seeing big increases.

“While vehicle crime is at far lower levels today than it was in the early 1990s, thanks to improvements in vehicle security, and the number of vehicles licensed to be driven on the UK’s roads is higher than at any point in the past, it’s still concerning that so many more vehicles are being stolen than just a few years ago.”

The average fleet loses around £16,000 per year as a result of vehicle or equipment theft, according to Verizon Connect.

Its research found that businesses have at least one vehicle stolen each year.

The average loss increases to nearly £50,000 for those businesses that have between 101-250 vehicles, as the number of vehicles stolen rises to three for businesses of this size.

Some of the increases in recent years can be put down to a rise in thefts of vehicles that are easier to steal, such as motorbikes and mopeds that are less likely to have immobilisers. Government data also shows that thieves generally use keys to access vehicles in around half of crimes, which suggests that drivers need to do more to keep their keys safe.

Tracker data suggests that nine out of 10 van thefts were performed using the keys.

In a fifth of cases (18% in 2018), thieves were able to access vehicles because they weren’t locked in the first place.

Company car drivers and fleets are being warned by Tracker to be wary of opportunistic criminals looking to steal cars to fill a replacement parts gap caused by COVID-19.

The stolen vehicle recovery company says that police across the country are already fighting an increase in ‘chop shops’ – where stolen vehicles are stripped down and expensive parts sold on. But, it argues, the lack of legitimate parts could increase their popularity and profitability still further. By Graham Hill thanks to Fleet News

The volume of motoring fines and penalties incurred by company car and van drivers increased by 3% in 2019, new figures from Lex Autolease show.

 

This compares to a 60% year-on-year cumulative increase over the past three years, suggesting a slower rate of increase than in previous years.

 

This was also reflected in the value of fines incurred by drivers, which did not grow for the first-time last year, bucking the trend of yearly increases from £10.7 million in 2016 to £17.1m 2019.

 

The percentage of drivers caught by bus lane cameras fell for the first time by 17% year-on-year, with fines issued for congestion charges and council parking also falling by 6% and 4% respectively.

 

Mersey Flow and Dartford Crossing fines also saw a year-on-year decrease with the total number of penalty notices issued falling by more than two fifths (44%) from 54,618 in 2018 to 30,391 in 2019.

 

However, the picture is not entirely positive, says the country’s largest vehicle leasing company.

 

The percentage of motorists penalised in private car parks rose by 6% year-on-year to £6.2m, and illegal junction-box stops and red-route driving fines increased by almost a fifth (19%) to £6.3m during the same period.

 

Lex Autolease analysed data from more than 361,000 company cars and vans to identify trends in behaviour and driver safety.

 

Kim Morris, motor operations director at Lex Autolease, said: “Company car drivers are often more likely to incur fines and penalties on the roads when compared to ordinary motorists, as the pressure to hit deadlines and attend meetings on time can sometimes lead to poor driver behaviour.

 

“The majority of fines can be easily avoided and if not closely monitored can quickly add up to expensive outgoings for employers – especially those with larger fleets.”

 

She believes that the emphasis fleet managers have placed upon driver health and safety in recent years is starting to pay off, with a considerable slowing in the rise of the number of fines incurred and a decrease in the number of fines for commonplace offences, including bus lane driving and congestion charges.

 

However, she said: “Our analysis shows that there’s still more businesses can do to educate their employees to bring these numbers down further.

 

“Continuing to invest further in driver education can help to modify employees’ driving habits and in turn save businesses unnecessary outgoings each month.”

 

She concluded: “As the new tax changes for alternatively-fuelled vehicles gather momentum, driver education will become even more important for fleets to make sure avoidable fines and penalties do not offset the cost saving benefits of low or zero emission vehicles.”  By Graham Hill thanks to Fleet News

• DVLA has recorded a 20% rise in the number of scams reported
• These are all cons linked to DVLA services, such as vehicle taxation
• Some 1,538 fraud cases were raised to the agency in the final 3 months of 2019
• It provided examples of common scams that have been used in recent months

 

Motorists are being targeted by fraudsters using a range of different scam tactics in a bid to trick them into handing over money.

 

That’s according to a fresh warning by the DVLA last February, which has provided examples of scams it has been alerted to and traced in recent months.

 

There has been a 20 per cent rise in fraud attempts handed to the DVLA, with 1,538 reports made to agency in the last three months of 2019, new figures show.

 

Car owners have alerted the DVLA to a number of different con tactics being employed by scam artists.

 

Motorists have said they have been swindled out of money and targeted by fraudsters using fake DVLA websites, emails, texts and social media messages.

 

It has warned drivers that these are becoming more prominent, having received 1,275 scam reports in the final three months of 2018 – some 263 fewer than in the final quarter of last year.

 

To raise awareness of the types of fraudulent communication motorists might receive, the DVLA has released images of recent scams it has been alerted to.

 

It hopes this will help motorists be aware of what to look out for and issue a clear warning that if something offered online or by text message appears too good to be true, then it almost certainly is.

 

Scammers are targeting unsuspecting customers with links to services that don’t exist and messages of tax refunds, all of which are fake.

 

The reports also show that driver and vehicle documents are for sale on the internet.

 

The agency says anyone who is concerned about any calls, texts, emails or suspicious activity online, to always report these to the police via Action Fraud immediately.

 

DVLA chief information security officer David Pope said: ‘We’ve released examples of real life scams to help motorists understand when a scam is at work.

 

‘These websites and messages are designed to trick people into believing they can access services that simply don’t exist such as removing penalty points from driving licences.

 

‘All our tax refunds are generated automatically after a motorist has told us they have sold, scrapped or transferred their vehicle to someone else so we don’t ask for anyone to get in touch with us to claim their refund.

 

‘We want to protect the public and if something seems too good to be true, then it almost certainly is. The only trusted source of DVLA information is GOV.UK.

 

‘It is also important to remember never to share images on social media that contain personal information, such as your driving licence and vehicle documents.’

 

A spokesperson for Action Fraud added: ‘This can be a stressful time of year, sorting out finances for the year ahead. Fraudsters are aware of this and are using different ways to trick people.

 

‘Taking a couple of minutes to familiarise yourself with a few simple online safety tips can be significant in protecting yourself from becoming a victim of online fraud.

 

‘You should always be cautious when sharing personal information online and avoid being scammed by only using GOV.UK for government services online, such as the DVLA.

 

‘If you believe you have been a victim of fraud, please report it to us.’

 

Note: If you want to see the sample emails being sent out go to the original article by clicking here:

 

https://www.thisismoney.co.uk/money/cars/article-8037209/DVLA-says-cons-used-fraudsters-trick-motorists-handing-money.html

 

By Graham Hill thanks to This Is Money

The number of vehicles registered for use on UK roads has exceeded 40 million for the first time, according to data from the Society of Motor Manufacturers and Traders (SMMT).

 

Analysis shows that more than 35 million cars and five million commercial vehicles were in use in the UK in 2019, an increase of 1% on the previous year.

 

The total includes more than 750,000 low, ultra-low and zero emission vehicles. The number of these cars grew by 26% last year, with 11,832 hybrids, 144,335 plug-in hybrids and 92,913 battery electric vehicles now in use.

 

Birmingham has the second highest number of battery electric and plug-in hybrid vehicles after Greater London, with some 24,000 zero and ultra-low emission cars on the city’s roads.

 

Light commercial vehicles grew by  2.7% on the previous year to 4.5m units, surging by 28% in the last decade. Passenger cars, meanwhile, increased 0.8% in the same period. The number of heavy goods vehicles grew by 0.4% to 608,000 – the largest number delivering for Britain since 1990.

 

Many of these vehicles are helping to provide transport for essential workers, deliveries and emergency services. Some 25,000 ambulance and fire service vehicles, together with more than 20,000 supermarket delivery trucks and lorries are keeping the nation safe, supermarket shelves stocked, and the flow of food, medicine and care to vulnerable people going during the coronavirus crisis.

 

Mike Hawes, SMMT Chief Executive, said, “As the UK continues to battle the coronavirus pandemic, keeping food, medical supplies and the people serving on the front line moving has never been so important – and these figures show the essential role Britain’s vehicle fleet plays for society. They also provide evidence that industry’s ongoing investment into ever cleaner, safer and more reliable vehicle technology is paying off, even as demand for mobility grows. To ensure this trend continues, we must get the right support for businesses and their workers in place now so that when this crisis is over, the sector can help get the whole country and our economy back on the move.”

 

Most popular cars

 

The SMMT’s Motorparc data reveals black as the most commonly seen car colour on the UK’s roads, with more than a fifth (7.1m) clad in the paint.

 

There are more superminis on UK roads than any other category of car, with the Ford Fiesta and Vauxhall Corsa the most common models.

 

The BMW 3 Series is the only premium badge car to feature in the top 10 list, with more than half a million examples on UK roads.

 

 

 

 

 

 

 

 

 

 

 

By Graham Hill thanks to Fleet News