Longhurst Group Case Study

In January 2020, Longhurst Group – one of the biggest social housing providers in the Midlands and East of England – issued a tender for its 150-strong company car fleet. Historically, the fleet had been managed through a broker that worked with a panel of leasing companies. However, this approach had resulted in limited proactive engagement and insight from the various suppliers. Moreover, because so many leasing companies were involved, there was a reluctance to update or improve the provision.

The Group’s Heads of Corporate Finance and Procurement, Peter Stubley and Matthew Rains, wanted to find a single leasing provider that could

• Help the Group to better understand the whole-life costs (WLC) of its company car fleet while advising on how it could avoid unnecessary expenditure.
• Offer improved choice and better quality vehicles across all six of the Group’s salary grade bandings.
• Support the Group to cut its carbon footprint by including more desirable electric and ultra-low emission vehicles (EVs and ULEVs) at all grades, and by incentivising their selection.
• Reduce the administration involved in managing vehicle orders and renewals.

After a short hiatus necessitated by the onset of the Covid-19 crisis, the Group selected LeasePlan UK as its sole supplier in May 2020, and the two organisations began working together to develop the offering.

Over the following two months, LeasePlan’s Consultancy Services team spent time with the Group’s fleet decision-makers:

• Building a deeper understanding of their unique requirements.
• Guiding them through WLC theory.
• Establishing a basket of benchmark vehicles at all six grades, including desirable EV and ULEV options, in line with discounts available through the Crown Commercial Service (CCS) Framework Agreement for public and voluntary sector fleets.
• Using its WLC modelling tools to assess the organisation’s existing policy and vehicles versus the benchmarks. By establishing a baseline of costs, the resulting analysis was also able to pinpoint inefficiencies and potential cost-avoidance opportunities at each grade within the Group’s existing fleet.
• Taking an iterative approach to the development of a new, monthly WLC allowance for each grade, working hand-in-hand with the Group to agree incentives that would entice its drivers to go electric, including an extra £100 allowance for those trading up to an EV/ULEV.
• Advising on the infrastructure required to support the new vehicles.

LeasePlan’s New Business and Account Management teams then worked with other areas of the leasing company to:

• Develop a dedicated online portal that would give the Group’s drivers a mechanism to review the vehicles available to them at each grade and order on a self-serve basis. This has been designed to offer visibility of the EV/ULEV incentives and provides a tax calculator with follow-up quotations, so the user can see how each option affects their benefit-in-kind (BiK) payments.
• Establish a dedicated driver hotline, providing a single point-of-contact for customer service, SMR bookings, and any queries relating to outgoing vehicles. (The system uses intelligent, key-based call-routing to direct drivers to their previous supplier.)
• Create a package of communications to proactively engage with drivers coming up for renewal, outlining the options available to them and signposting them to the portal and driver line.
• Organise two virtual roadshows for the Group’s drivers, detailing how the new WLC-based policy works, as well as the benefits of going electric.
• Initiate robust, ongoing cost-focused reporting and analysis, using LeasePlan’s new My Fleet reporting tool.

Although the online portal is still in its infancy, having only launched in March 2021:

• 30 drivers that are eligible to change their cars have already engaged with the portal; all will have ordered their vehicles by the end of April 2021.
• There has been 100% take up of EV/ULEV options among those that have already ordered their vehicles, demonstrating that the Group’s drivers acknowledge both the environmental and financial benefits of moving to lower emission company cars.
• LeasePlan anticipates that the Group will avoid up to £300,000 in unnecessary costs over the renewals life-cycle thanks to a policy that is now built around WLC rather than net rentals.

“We switched to LeasePlan UK because we wanted a proactive EV and ULEV leasing partner that could help us move from a policy built around net rentals to one focused on WLC. LeasePlan took a consultative approach, analysing our existing fleet against benchmark vehicles at six different grades while providing sound guidance on EVs and the charging infrastructure required to support them. It subsequently delivered a number of value-adds – including a portal through which our drivers can review and choose from several different EV/ULEV options while understanding the tax implications.

“This capability, combined with LeasePlan’s alignment with the CCS Framework Agreement and its focus on reducing our administrative burden, has been a real differentiator. Crucially, it is set to help us avoid up to £300,000 in unnecessary costs as we go through the renewals phase.” Matthew Rains, Head of Procurement, Longhurst Group