What is the BVRLA Vehicle Funding Guide?
The BVRLA Vehicle Funding Guide for July 2016 introduction says its plentiful pages will explore “the pros and cons of buying vehicles outright in addition to a wide range of funding services” and take “a fresh look at whether to give employees a company car or cash alternative”. In our opinion, that might be a tad grandiose…
The guide is a summary of common car funding options focusing heavily on the tax and accounting differences (it’s written in cahoots with Grant Thornton, an independent accounting network) followed by an Employee Benefits section defining BIK and fuel rates and a fleet terminology glossary.
Who is it for?
The way the BVRLA has written this Funding Guide makes it feel like an introduction or basic reference guide for those new to the world of leasing. We think it would be most useful to those of you who have recently been given fleet responsibility on top of your day job.
The Guide does point out that it is no substitute for professional fleet consultancy which we would firmly echo: there is a splattering of non-specific car examples throughout, but this won’t be anywhere near enough to help businesses decide how to choose between finance options or, as the introduction suggests, decide between a “company car or cash alternative”. The real life examples and funding comparisons just aren’t there.
BVRLA Funding Guide summary & review
1. The funding descriptions are accurate and snappy which makes this Funding Guide a sound introduction to the UK’s common finance options as well as the lessor/lessee relationships surrounding each.
2. The bulleted funding pros and cons in each section are useful and easy to grasp but we would have liked to have seen a table, even in an appendix, to easily compare these against each other.
3. We'd advise taking the “Personal Motoring Scheme” section with a pinch of salt. The facts are sound but there’s a lot which isn’t said. In our opinion there’s too much inference which doesn’t belong in a non-biased guide, particularly regarding the Personal Contract Hire (PCH) section, or lack thereof.
For example, under Personal Car Plans, (which they abbreviate to PCP which is more commonly a Personal Contract Purchase acronym) the BVRLA guide explains how Affinity Scheme funding is based only on “the difference between the purchase price and the residual value”, hence low monthly costs. Now, the same can be said of the alternative Personal Contract Hire approach yet the guide makes no reference of this in the preceding (conspicuously short) PCH section. Readers could forgivably interpret this funding strategy as a unique benefit to Affinity Schemes, which is not the case.
4. The A-Z glossary at the back is a helpful resource. This one-stop-shop for common terminology gives straight-forward and concise descriptions but let’s be fair, most people will simply demand definitions via google!
Download the full BVRLA Vehicle Funding Guide PDF for July 2016:
Company Car Comparisons
As a BVRLA member ourselves, we have the know-how to help you take this Vehicle Funding Guide introduction and translate it across onto your fleet, with real-life numbers and comparisons. If you're looking into your fleet options, now is a great point to request a call back from our friendly team.
Or, if you’re a driver, you might find our “Company car or cash allowance?” blog article a beneficial little read.