Is A Company Car A Benefit

Company cars have been a mainstay in the benefits package of many employers for years, but have become increasingly popular in recent years as more businesses are offering them not just to senior executives, but to mid-level employees. A company car can provide many benefits; not just financial, but also in terms of convenience and morale. While there is no one-size-fits-all solution when it comes to a company car, there are several factors to consider when weighing up the pros and cons of making a company car available to employees.

A key benefit of a company car is the financial benefit. Generally, a company car is provided free of charge, saving the company the expense of vehicle leasing or purchasing, meaning employees can enjoy use of a car without any upfront or ongoing costs. Furthermore, the company can benefit from tax savings by providing a company car. This tax relief is substantial for the company and can result in significant savings.

The convenience offered by a company car is also attractive to employers. In many corporate workplaces, employees need to travel between multiple sites, and a company car makes this much easier and more efficient for the employee. Furthermore, for sales roles and other positions where travel is an essential part of the job, using a company car will save employees from having to provide their own transport.

Company cars also often have the added benefit of being equipped with the latest technology, such as hands-free calling, navigation, and safety features. This can increase the employee’s productivity and efficiency while on the road, and also provide peace of mind that they’re driving a modern and safe vehicle.

One of the downsides of providing a company car is the cost. While there are financial benefits as mentioned above, the company will still have upfront and ongoing costs associated with providing a company car. These costs include insurance, maintenance, and fuel which should all be factored in to the overall cost of providing the car.

Another potential downside is the potential for abuse. Having access to a company car can put employees in a position of privilege and the potential for misuse is real. In order to prevent potential abuse, business owners should establish a clear set of guidelines and rules for the use of company vehicles to ensure accountability.

Overall, a company car can be a great benefit for both the employer and the employee. It can provide financial benefits as well as increased convenience, productivity and morale for both parties. It’s important for businesses to weigh up the pros and cons and factor in the potential costs and risks before making a decision.

Company Car Quotas

Another approach companies can take when considering a company car benefit is to implement quotas on the number of vehicles they provide. This can help control the costs associated with running a car fleet and ensure that only the most valuable employees are deemed eligible for a car. Quotas can also help with the problem of employee abuse, as it can provide an additional level of control over who is eligible for a company car.

There are several methods businesses can use to assign quotas. They could allocate cars on the basis of seniority, position, or performance. Alternatively, they could allow employees to bid for cars, allowing them to bid for a car depending on their individual needs and circumstances. This would give employees more control over the process, and can also create a competitive environment which can lead to increased motivation and productivity.

Whichever strategy a business chooses to adopt, it should ensure that the process is fair and that all employees have a fair chance of getting access to the resource. Companies should also ensure that the criteria for awarding cars is clearly outlined, to ensure transparency and accountability.

Company Car Awards

Companies may also consider offering company car awards, to recognize and reward employees who have excelled in their roles. This could act as an incentive to encourage and reward strong performances without having to offer a full car benefit, and can keep costs down and still provide the morale boost that comes from being recognized for excellent work.

These awards could either be one-time awards for employees who have achieved extraordinary results, or could be annual awards for the most outstanding employee of the year. They could also be linked to the company’s performance, with employees rewarded for achieving targets or reaching key milestones within the company. Such awards can help to create an environment of recognition and appreciation, which can help with retention, motivation and engagement.

When offering such awards, employers should ensure that they’re fair and transparent, ensuring that all employees have an equal chance of being recognized and rewarded. Employers should also consider other forms of recognition and rewards, to ensure that the full range of employee contributions are recognized and rewarded appropriately.

Company Car Allowances

A final option when considering a company car benefit is to provide an allowance instead of a full car benefit. This can be an attractive option for employers who want to provide a car benefit to more employees without having to bear the full brunt of the cost. This can be a great way to provide flexibility and freedom to employees without breaking the bank.

Companies can provide a range of allowances, from a one-time lump sum for those who choose to buy their own car, to ongoing monthly allowances for those who need to lease or rent a car. Companies should carefully consider the cost of such an allowance, ensuring that it is sufficient to cover the costs associated with owning or leasing a car while still remaining within the budget.


A company car can be a great benefit for employers and employees alike. It can offer financial savings, increased convenience, and incentives for productivity. However, it’s important to consider the costs and risks associated with providing a company car, and to ensure that all employees have a fair chance of getting access to the resource. Companies should also consider other car-related benefits, such as quotas and allowances, to ensure they’re providing the best value for money and providing the most appropriate car benefit to their employees.

Marjorie Turcios is a seasoned leader and management expert with over 25 years of experience. She has held various leadership positions in private industry, government, and education. She is an advocate for creating win-win solutions and has worked to create successful, lasting change in corporations and organizations. Marjorie is an award-winning author of several books on leadership, mentoring and coaching, and effective communication skills. Her passion is to help others discover their potential and reach new heights in their professional life through her writings. Marjorie resides in Dallas, Texas where she enjoys spending time with her family, traveling to different places around the world, and speaking at conferences about her areas of expertise.

Leave a Comment