What do record high fuel costs mean to your business?

Reports in the news today reveal that fuel prices are now at a 30 year high. So what would it mean to your bottom line if you could cut your fuel use by up to 29%? 

  • Less dollars spent

  • Less km driven saving other costs

  • Less km = less risk on the road

  • Less co2 emitted

  • Less administration

With a 30 year high in fuel prices, even before the new excise tax is added in October, do not expect that your vehicles will be used less. Expect your costs to increase due to employees using your vehicles more, as they try to use theirs less.

The higher the fuel price goes, the more fuel you will find your fleet uses.

The other risks of employees using your vehicles more are:

  • More time on the road equals more risk of an accident. Do you have the time and admin for this right now? Every accident costs your business between 6 and 30 times the excess cost in lost productivity and admin.
     
  • Insurance cover. Does your insurance cover personal use of vehicles? You may be as surprised as many of our customers are, especially if you are in the service industry. Can you afford to replace that van right now with no insurance cover?
     
  • Fuel Fraud will happen, we see this all too frequently and the occurrence of it is not decreasing. How do you know if 10L too many went into your vehicle? How do you know it was your vehicle that even went to the petrol station? Sharing of your company fuel cards with family members is increasing.
     
  • More km driven means more wear and tear, more servicing and maintenance, more RUCs, and higher lease costs. Do you have the budget for this right now?
     
  • FBT risk. Are you paying Fringe Benefit Tax for all that personal travel your employees are now doing in your vehicles? Are your vehicles branded and easily spotted by the IRD when parked at the local park, movies, shopping centre? Do you have the money and admin time to manage FBT at a cost of 20% of the purchase price of the vehicle? Even on a low-cost vehicle of $30k that's $6000 a year.

As you can see, a small increase in the direct cost of fuel will have a large flow on effect to your business. Not only will fuel cost more, you will be buying more of that fuel and taking on all the above risks.

From less than 56c per day, you start solving these problems. These problems will exist in your fleet, unfortunately they are all too common. 

Contact Argus Tracking today and ask about FUEL WATCH to start managing your fuel use more effectively.