New 2017 analysis of the FN50 – the UK’s top 50 contract hire companies by total RV risk fleet numbers – found that fleet operators are paying less in excess mileage charges on leased company cars this year, despite the charges for vans rising in recent months.
The decline in excess charges indicates contract hire providers are demonstrating greater awareness of business’ mileage needs and are responsibly working with their customers to help them avoid unnecessary charges at the end of the contract period.
In 2017, FN50 companies reported that almost a fifth (19%) of cars experienced excess mileage charges, the same as in 2016. However, this year’s average charge of £358 is £55 less than last year and almost £100 lower than two years ago.
Interestingly, the variance between average excess mileage charges is exceptionally stark, with the lowest charges reported as £33 and the highest reported as £1,100.
The 2016 report revealed that more telematics and connected systems were being fitted within fleet vehicles in a bid to keep a more accurate track of mileage during contract periods and were more effectively managing mileage for fleet operators. With the reduced charge trend developing in the last 12 months, it appears more fleet operators are striving for ways of keeping on top of excess mileage without the need to fork out unnecessarily high excess charges at the end of their fleet lifecycle.
Meanwhile vans incurred average excess mileage charges of £496 this year, up from £480 in 2016, and the percentage of vans subject to excess charges grew from 19% last year to 22%.
These figures would appear to contradict the trend of car charges declining, while vans are also more likely to be operating telematics systems than cars to closely monitor mileage. The breadth of average excess mileage charges for van fleets is even bigger than cars, starting from £48 and rising up to £2,000.
The percentage of returned vans with excess mileage ranges from 5.8% to 60%, although the fleet operator reporting the highest figure did not disclose the average charge per vehicle.