Why a Mixed Vehicle Program Model Delivers Strategic Flexibility

As vehicle programs evolve to meet diverse operational demands, a single reimbursement model rarely fits all. A 2024 industry survey found that 35% of companies acknowledged running multiple vehicle programs, such as fleets, Fixed and Variable Rate (FAVR), and Cents per Mile (CPM) reimbursement. 

This figure underscores a growing trend: organizations are recognizing the value of a mixed vehicle program model.

Companies that implement a mixed model gain the flexibility to tailor reimbursements to employees’ driving patterns, locations, and roles, all while maintaining compliance and controlling costs. Rather than forcing all drivers into a one-size-fits-all program, a mixed model aligns reimbursement strategy with operational reality.

The Case for Mixing Vehicle Programs

Each vehicle program offers unique advantages and limitations. 

FAVR is best suited for employees who drive over 5,000 business miles annually and use personal vehicles that meet IRS requirements. It offers regionally accurate reimbursements and full tax compliance when administered under an accountable plan.

CPM, on the other hand, is simple to administer and serves low-mileage drivers well. However, it can under-reimburse those with frequent long-distance travel. Fleets, while appropriate for roles requiring specialized vehicles or high branding visibility, come with significant overhead costs, including insurance, maintenance, and depreciation.

By combining these models, companies can assign FAVR to high-mileage field reps, CPM to occasional drivers, and maintain fleet vehicles for those whose roles demand it. 

This approach ensures equitable treatment across driver profiles while avoiding waste from over- or under-reimbursing. Moreover, it helps mitigate risk by segmenting liability based on vehicle ownership and insurance structures.

When a Mixed Model Makes Sense

A mixed model is particularly effective for organizations with varied field operations. For example, national service providers often employ technicians, account managers, and regional sales staff, each with differing mobility needs. 

A one-size vehicle policy can lead to inefficiencies: overpaying infrequent drivers or incurring unnecessary fleet costs.

Companies undergoing transitions, such as reducing fleet size or responding to regional cost disparities, also benefit from hybridizing their vehicle programs. 

Cardata has found that transitioning from a full fleet to a blended model can reduce capital expenditure and administrative complexity while maintaining continuity for essential fleet roles.

The key to success in a mixed model lies in rigorous policy design, automated mileage tracking, and consistent compliance monitoring. Tools like Cardata Mobile enable seamless administration by capturing IRS-compliant mileage logs, classifying trips, and syncing with reimbursement platforms.

Why More Companies Are Embracing Mixed Vehicle Programs

As mobility needs diversify, the mixed vehicle program model offers a pragmatic solution. Companies balancing specialized vehicle requirements, cost containment, and fairness across roles are increasingly shifting toward this approach. 

When properly implemented, a mixed model delivers equitable reimbursements, simplifies compliance, and aligns vehicle policies with strategic business goals.

The 35% of companies already reporting multiple vehicle programs are just the visible portion of a broader shift. As more organizations recognize the operational and financial advantages of mixed models, the number is expected to rise. 

Businesses should evaluate their field workforce, driving patterns, and risk exposure to determine the optimal blend of FAVR, CPM, and fleet in their reimbursement strategy.

Want to learn if a mixed model is the right fit for your organization? Talk to our experts today and see what’s possible.

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