Aon Belgium recently held a survey among a number of employers in order to establish any trends in the market regarding company car policies. On February 6th a seminar took place at which the trends were presented. It looked at a number of areas, and the conclusions from the seminar related broadly to three categories - company policies, the environment, and the financial (budgetary and taxation) aspects - though there is inevitably a good deal of overlap between all three.

Car policies Most companies have very detailed car policies, and more than half have reviewed their own policy during

the last two years, with the remainder having the intention of doing so. in the near future. The majority of

policy changes is related to lease budgets and to reductions of ecological footprints. Lease budgets are

generally based on a replacement period of four years and 150,000 kilometres; the average age of

company cars in Belgium is 3.6 years. This compares with 7.5 for privately owned cars in the country.

Operational lease The most commonly used financing method is operational lease, with ninety per cent of companies opting

for this method. Around three-quarters of all companies permit their employees to exceed their maximum

lease budget, in return for a one-off payment at the start of the lease period or monthly payments for the

duration of the lease contract. Some thirty per cent of firms give their employees a fuel card that can be

used in other European countries, as well as Belgium. The main beneficiaries of this are senior and general

managers. However, it is rare for employees who do not have a company car to be given a fuel card (only

five per cent of companies do this) as this is disadvantageous from a taxation point of view.

Salary level and lease budgetOur survey indicates that the average annual salary at which employees receive a company car is 68,933

euros. There is an obvious link between lease budgets and salary levels. The significance of the former is

more important for employees on lower salaries, as the level of the budget determines the range of

vehicles that is available. Employees who lose their right to a company car as a result of taking on another

position are not generally compensated for this. In the event of an employee leaving a company before the

end of the lease contract, two-thirds of companies reallocate the car internally.

Company Car Survey 2013Aon Belgium

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Car

Surv

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three per cent of companies use the so-called “net contribution only method”. After the introduction of

with low CO² emissions, but for high-end cars it is markedly punitive. Premium brands continue to feature

smaller and greener cars, means that the Belgian government is unlikely to earn the 200 million euros from

the lease-car industry that it was hoping for. Indeed, the level of CO² emissions is now the most important

type of fuel. Meanwhile, new rules relating to VAT will probably lead in most cases to VAT deductibility

Total cost of ownershipEmployees who drive more than

24,000 kilometres a year on business

using a reasonably-priced car may

based allowance instead of having a

company car put at their disposal by

the employer. Up to 25 per cent of

the total cost of ownership of a lease

contract is linked directly or

indirectly to risk costs (insurance,

excess, termination of contract,

replacement car).

techniques, companies can make considerable savings in comparison to having the vehicles insured

in such cases. Providing an inside view of the cost drivers and circumstances creates greater awareness in

their employees to bear the excess in the event of an accident, while two-thirds have already organised, or

are considering organising, mandatory eco-driving lessons.

More information

Aon Belgium

Rue Jules Cockxstraat 8 - 10

1160 Brussels

auto@aon.be

+32 (0)2 730 95 11

+32 (0)2 730 98 88