Pool Vehicles & Grey Fleet – the fleet industry’s elephant in the room
Many Company Directors and Management teams do not take the issues surrounding Pool Vehicles and Grey Fleet seriously, in fact many do not understand the fiscal and operational risks they represent for the business.
Much of the Australian fleet sector has a good handle on the management of the core fleet vehicles, understanding fleet operating costs, funding and Novation.
But are they considering the vehicles in the car park owned by the organisation and driven by everyone? Are they considering the vehicle driven by Susan in Accounts who is collecting lunch in her own car – a grey fleet driver?
My experience over many years is that these factors are not considered and organisations ignore the pool vehicles and don’t even know how many grey fleet drivers they have!
The numbers of pool vehicles in Australia and New Zealand is huge, most companies have one or two but most larger organisations, such as not for profits, Government, universities and large corporates, have anything from tens to hundreds. One State Government has thousands across multiple departments and budget centers.
The common truths surrounding the clear majority of pool vehicles are:
- No one understands the utilization statistics – why has that car sat parked for 6 weeks?
- The management of who drives these vehicles is poor – who was driving when that infringement took place?
- Do the drivers have a valid license – is your driver driving an unsuitable vehicle, do you know?
- Have the driver signed your company policy on using vehicles – they may not know your rules!
- Are they fit to drive at all – there could be a reason why they don’t have their own vehicle
- Is your FBT liability fully covered if private use is incurred – it’s possible to have FBT private use in todays market
These examples are just scratching the surface and my work with our clients is showing much worse situation on an ongoing basis. I have seen cars that are not fit to be driven with illegal tyres and I’ve seen drivers using vehicles without a licence and sneaking them home for private use!
Much of my time is spent working on the introduction of pool vehicle management systems. These systems range from simple online booking and OH&S tools through to very clever GPS based pool systems which can:
- Full ongoing optimization reporting
- Automatic booking allocations and budget reporting
- Dynamic booking management
- Keyless entry to vehicles
- FBT free Private use generating income to the organisation
I am happy to chat to anyone who needs some advice on the pool side, with 20 years of fleet and pool management we can help with booking systems, policy advise and GPS systems.
OK, so who knows what grey fleet is?
Well, I can’t test you but the truth is that if you know what it is then you are a rare person!
Grey fleet is a vehicle, from bike to truck, owned and driven by your employee on behalf of company business, everything from taking the post at the end of the day through to attending meetings etc.
It is estimated that there could be as much as 6 billion kilometers driven by Australian employees in this way – a huge and unmanaged risk!
Statistics have shown for companies allowing grey fleet use that:
- Only 50% check and hold licenses
- 44% do not check that the employee is insured for business use
- under 37% verify that the employee’s car has a worthy certificate
The key issue here is that the law allows for the chain of responsibility. So if your employee is driving their 25 year old Holden, without a road worthy certificate and bad brakes, they are speeding and have not got a licence – guess who is responsible?
The answer is of course it will start with them, BUT, once the police understand they are driving on your company’s behalf the chain of responsibility comes in. If you did not check the driving licence, got them to sign a policy that protect your risk and states the minimum standards for vehicles driven on behalf of your company then you could be facing serious legal challenges through the chain of responsibility law.
I am amazed by the amount of organisation that do not appreciate this risk, we work with these companies to introduce an online management system that records details for the driver, their vehicle and if policy is in place records every journey.
If reading this has raised questions in your mind please do not hesitate in ringing or emailing me, I would be happy to chat and offer some support and advice.
Tel: +61 (0) 499 549 337