Save Fuel With These 5 Innovative Ideas for Minimizing Company Car Expenses

Company cars need regular maintenance to keep them running efficiently at peak form. Businesses and their employees must consider minimizing fuel costs so they can stretch their budgets further and ensure their vehicles are operating effectively.

Motor vehicle insurance rates rose 53.7% between 2020 and 2024, and fleet owners are feeling the pinch. Businesses with company cars should implement methods to conserve fuel to make their fleets more cost-effective. There are several ways to do this.

1. Change to Hybrid or Electric

Businesses should consider replacing an existing company car with a hybrid or electric model. Doing so eliminates or greatly reduces gasoline expenses. This also announces to shareholders and employees that the organization values progress and eco-friendly advancements.

Proceeds from selling old fleet vehicles could be used to offset the price of the new cars. Inflation Reduction Act of 2022 stipulations enable companies to claim an immediate $7,500 tax credit on every qualifying commercial vehicle with a gross weight rating of under 14,000 pounds.

Companies promoting sustainability in this way positively impact the environment and save considerably on fuel. As a further environmental step, they could donate unsold company cars to charity, likely saving on tax or depreciation.

2. Check Tire Pressure and Alignment Often

Regular tire pressure and alignment checks on a company car can lead to substantial fuel savings. Consistently keeping tire pressure at the model’s specifications can improve gas mileage by an average of 0.6%, while under-inflated tires can reduce mileage by 0.2% for every psi drop below average pressure.

A car pulling to one side or with a vibrating steering wheel is a standard indicator of unaligned tires. Aligned tires are smooth on the road, meaning the vehicle isn’t working as hard to move forward. Doing less work means using less fuel — gas mileage can increase by as much as 10% by aligning the vehicle’s wheels.

3. Use Synthetic Oil

For many years, synthetic oil was a prerequisite in high-performance vehicles. More recently, it has become the recommended engine lubricant in many mainstream car models from manufacturers like Chevy, Subaru and Toyota. The lower viscosity, thinner synthetic oil works better in high engine temperatures, especially in extremely hot or cold climates.

Synthetic oil doesn’t break down and form sludge like other lubricants. It lasts much longer, keeping a car’s engine cleaner and affording more protection by coating it better. Synthetic oil can last 7,500-10,000 miles between changes, and some cars can handle up to 16,000 miles.

Fleet owners who use synthetic oil can save money on changes and enjoy a better fuel economy, and companies with a substantial fleet will expend substantially less on gas.

4. Carry Out Regular Car Maintenance

Regularly servicing vehicles instead of waiting for manufacturer and industry recommendations can improve efficiency. Engine oil type and levels, along with other fluid levels, plugs, filters and the car’s belt condition, all contribute to fuel consumption. Manufacturers advise services at 30,000-mile intervals, which ensures company cars continue running smoothly and economically.

Whether using conventional or synthetic engine oil, maintaining optimal levels improves a vehicle’s fuel efficiency. Water and other fluid levels, spark plugs, air and oil filters, and fan and timing belt conditions all impact a car’s performance since it has to work harder. Keep an eye on these items between servicing.

5. Other Innovative Ideas

Making employees aware of smaller everyday practices can reduce fuel consumption. Company car drivers can make these changes to save companies money in the long run.

• Keeping to the speed limit can save substantial amounts of money on fuel. It is also a good rule to follow, no matter the circumstances, to ensure all drivers stay safe on the highway. Consider hosting regular driving classes or road safety seminars to instill this tenet for both safety and eco-friendly consistency.
• Only use the air conditioner when necessary. Using the car’s ventilation system or opening a window might not be as comfortable, but it saves on gas. However, employees should maintain their comfort levels in hot and freezing temperatures.
• Carrying unnecessary loads creates an extra burden on the vehicle and affects its fuel use. Stacking the roof rack increases wind resistance, which increases gas consumption. No matter what your organization is hauling in your company car, there may be places to lighten the load.
• Planning meeting stops on a single route reduces fuel consumption and carbon emissions. Consider delegating an employee to map routes or optimize the team’s practices in this area.
• Driving less aggressively can save substantial amounts of gas and reduce wear and tear on a car’s working parts, tires and brakes, contributing to better fuel economy. Managers might conduct audits or shadowing evaluations of their drivers to ensure these rules are followed. Some companies even adhere stickers with the customer service hotline so fellow drivers can report unusual occurrences or stellar driving.
• If drivers are idling or waiting to pick up products or other passengers, then it’s a good practice to turn off the vehicle. Cars guzzle more gas when idling than restarting, with 10 minutes of idling equaling 276 grams of CO
• Where possible, walk, cycle or take public transport to appointments as a logical fuel-saving method. Companies can incentivize employees who use these commuting methods with rewards or quarterly shoutouts.

Combining these small but practical ideas will positively impact fuel consumption and save a company money. Anything employees can do to reduce their travel spending helps sustain the fleet.

What Is the Major Contributor to Rising Company Car Costs?

While gasoline prices have stabilized since peaking in June 2022, other added costs for vehicle maintenance, licensing, depreciation and taxes play roles in company car expenditures. However, the primary cost is fleet insurance.

Companies require 24-hour liability coverage on their fleet vehicles. This is mandatory and necessary to practically negate the possibility of lawsuits resulting from accidents or injuries. These insurance rates require business owners and staff to reduce expenses everywhere else they can.

The founder of Shapiro Negotiations Institute remarks, “Effective contract negotiation with insurance providers can significantly reduce overall company car expenses, allowing businesses to better manage other costs such as maintenance, licensing, and fuel.”

Owners and Staff Can Make a Difference by Saving on Fuel

Businesses with fleet vehicles may not be able to do much about increasing insurance premiums, but saving on gas and oil is one area where they can make a difference. A bit of innovation and frugality of use can go a long way in increasing fuel efficiency and minimizing operating expenses.