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Hughes plugs into Activa Contracts to deliver new-look fleet

Hughes plugs into Activa Contracts to deliver new-look fleet

Activa Contracts has won a sole supply, full outsourcing deal with Hughes, one of the UK’s largest electrical retailers.

Lowestoft-headquartered Hughes, which has retail outlets across East Anglia and the Midlands, operates a 175-strong vehicle fleet comprising 140 light commercial vehicles and 35 company cars.  

Historically, family-owned Hughes, which will celebrate its 100th anniversary in 2021, has outright purchased virtually all vehicles with a small number being leased, but has now decided to contract hire all company cars and vans following a comprehensive funding review.

Initially, Activa Contracts, the Milton Keynes-based division of Arnold Clark Finance, has undertaken a sale and leaseback deal on 86 vehicles and will fleet manage the remainder until renewal.  

In selecting Activa Contracts as its fleet business partner, Hughes took advantage of the specialist’s consultancy service to review both its vehicle funding strategy and existing company car and van policies.  

Following the comprehensive review, employees will benefit from an enhanced company car choice. With vehicle selection now based on whole life costs, drivers have a significantly wider car choice, while also potentially achieving benefit-in-kind tax savings.  

As well as whole life cost monthly expenditure, company car selection criteria also now takes into account vehicle type, engine capacity and insurance group restrictions. Additionally, a carbon dioxide (CO2) cap currently set at 130g/km is in place tied to the main rate capital allowance threshold for business cars, but that limit will reduce to 110g/km in April 2018 so further helping Hughes trim its environmental footprint.  

The company car policy review now means that employees have up to 700 vehicles to choose from depending on their vehicle grade.  

Chris Thornton, finance director, Hughes, said: “Activa Contracts was able to prove that by moving to a contract hire funded fleet with company cars selected on a whole life cost basis the business would make significant financial savings. Additionally, employees would benefit by having a wider choice of vehicles.”
 
Activa Contracts’ sales director Lisa Temperton said: “Our consultancy approach has transformed Hughes’ company car policy so that employees now have hundreds of vehicles to choose from, while ensuring that the fleet is cost-effective to operate and fit-for-purpose.  

“Ensuring that company car choice lists are based on whole life costs invariably delivers financial savings to employers, while employees benefit from an enhanced range of vehicles to select from that can also deliver tax savings compared with previous models driven.”  

Hughes, the country’s fourth largest specialist electrical retailer and the second largest provider of home entertainment and kitchen appliance rentals, also operates a significant van fleet driven by employees delivering and servicing white goods, including televisions and washing machines.
 

Previously operating a multi-badge van fleet, Activa Contracts’ review based on whole life costs and operational requirements sees Hughes turn exclusively to Ford and Vauxhall vehicles.  

Additionally, Activa Contracts’ ‘one-stop shop’ van solutions’ strategy sees vehicle partner Bott ensure all new Hughes’ vehicles are fit-for-purpose with appropriate conversions, racking and livery.
 

Ms Temperton said: “This ensures that light commercial vehicle health and safety legislation is complied with and makes life easier for drivers in terms of loading and unloading vans.” 

Mr Thornton said: “The van fleet is business critical to Hughes. Therefore, it is vital that it is not only fit-for-purpose and operationally cost-effective, but as a high street retailer a smart liveried van fleet delivers ‘free’ advertising to the company.”  

Additionally, Activa Contracts is delivering a full suite of in-life vehicle and driver services to Hughes including: fleet and accident management and risk management that includes employee driver licence validation. Furthermore, Activa Contracts is also working in partnership with Hughes on updating its driver handbook to ensure that its meet current best practice standards.