A company-provided fleet is still a better bargain than the IRS reimbursement rate

December 16, 2009

Recommended by 5 People

By Greg Corrigan
VIce President, Strategic Consulting, PHH Arval

The IRS recently announced that the new variable reimbursement rate for 2010 will be 50 cents per mile, down from 55.5 cents per mile last year. Every year when this announcement is made, it always makes me ask: How does the cost of a company-provided fleet compare to the reimbursement rate?

The table below shows four different PHH fleet types, and their average cost per mile. These companies were selected because they use all services, and thus these costs are all-inclusive. They were also selected because their manufacturer incentives have always been capitalized into the asset price.

As the numbers show, a managed, company-provided fleet (versus a reimbursed one) still represents the best value to your company – in simple economic terms alone. But when you factor in increased driver productivity, and visible brand identity and image benefits, a company-provided fleet represents a clear and compelling competitive advantage.

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