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Book a CallTransitioning to a mixed fleet, which is a combination of company cars and vehicle reimbursement programs (VRPs), can feel like juggling a million priorities. But with thoughtful planning and collaboration, finance professionals and fleet managers can really drive cost savings, operational efficiency, and employee satisfaction while embracing modern mobility solutions.
Let’s explore some practical tips to make this shift smooth and strategic for your organization.
1. Understand why you might want to consider a mixed fleet
The days of sticking solely to a company-owned fleet are over. VRPs like FAVR (Fixed and Variable Rate reimbursement) offer an IRS-compliant solution for mobile workers, blending fixed costs (like insurance and depreciation) with variable costs tied to mileage reimbursement.
Why it works:
- For finance professionals: A mixed fleet helps balance the bottom line, with VRPs offering tax-free perks and reducing vehicle expenses tied to procurement and ownership.
- For fleet managers: It minimizes maintenance costs and personal use challenges, focusing fleet vehicles where they’re most needed.
By integrating VRPs alongside company vehicles, you can tailor mobility solutions to employee roles and usage patterns while keeping the business use of vehicles compliant with IRS regulations.
2. Build a strategy that works across teams
Mixed fleets thrive on collaboration. Fleet managers, finance leaders, and HR teams all play critical roles in making this transition work.
- Fleet managers: Identify non-specialty roles or low-mileage drivers who could benefit from switching to personal vehicles under a VRP like FAVR. Telematics and mileage tracking tools can help pinpoint usage patterns.
- Finance professionals: Establish clear reimbursement rates that reflect IRS-compliant mileage rates while considering the true cost of ownership (including depreciation and leasing costs).
- HR teams: Focus on change management by communicating the perks of employee-owned vehicles, such as flexibility and fair compensation for business mileage.
Pro Tip: Conduct a workshop or webinar to explain the benefits of a mixed fleet. Use real-time data from tools like SAP Concur to showcase how this approach enhances fleet management efficiency and supports employee satisfaction.
3. Pilot the transition with milestones
Rolling out a mixed fleet doesn’t have to happen all at once. Start with a pilot program targeting a specific group of employees, such as low-mileage or regional mobile workers.
Key steps for success:
- Test the FAVR reimbursement model in a controlled setting to evaluate cost savings and compliance with IRS regulations.
- Monitor mileage tracking accuracy and ensure drivers understand reimbursement rates and processes.
- Track milestones, like reductions in vehicle expenses, maintenance costs, and personal use challenges.
This phased approach gives your team time to refine the program and address any roadblocks before scaling it across your organization.
4. Communicate the change clearly
Change management is super important when shifting to a mixed fleet. Employees and stakeholders need to understand the why and how of the transition to avoid resistance.
- Highlight cost savings and automation benefits for finance and fleet management teams.
- Emphasize the flexibility of VRPs for employees, showcasing how they can use personal vehicles for business purposes while being fairly reimbursed.
- Address concerns about personal vehicle use with clear communication about FAVR reimbursement and mileage rate compliance.
Pro Tip: Use company podcasts or newsletters to share success stories from the pilot program, showing real-world benefits for mobile workers and the company’s bottom line.
5. Optimize for long-term success
Once your mixed fleet program is up and running, focus on fine-tuning for efficiency and growth.
- For finance professionals: Continuously track cost savings using tools like SAP Concur, ensuring reimbursement rates align with IRS guidelines and business mileage trends.
- For fleet managers: Leverage automation and telematics to maintain visibility into vehicle use and ensure optimization of both company-owned and employee-owned vehicles.
- For the organization: Use insights from the program to drive sustainability initiatives, such as transitioning to electric vehicles or optimizing supply chains.
By building a scalable, cost-effective mobility solution, you can future-proof your fleet management strategy while maintaining alignment with procurement and organizational goals.
Conclusion: A smooth transition for big rewards
Transitioning to a mixed fleet is more than a logistical change—it’s a strategic shift that brings flexibility, cost savings, and modern efficiency to your organization. With the right plan, collaboration, and tools, you can achieve a seamless transition that benefits everyone, from finance teams and fleet managers to mobile workers and the company’s bottom line.
If you’re exploring how VRPs like FAVR could complement your fleet programs, partners like Cardata can guide you every step of the way. Ready to make your mobility strategy future-ready? Let’s get started.
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