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
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.