What Is Down the Road for Car Policies

Mercer Select Intelligence Car Benefit Policies 2017

Expense accounts. Three martini lunches. Company cars. What do these three things have in common? Well, if recent news is any indication, they’re all things of the past. When GE, the blue-blood American industrial firm, announced last month that it was eliminating its company car policy for senior executives, many regarded it as the swan song for one of the corporate world’s longest-standing employee benefits.

But are companies around the world really pulling the plug on their car programs? Maybe not. Mercer’s 2017 Car Benefit Policies Around the World survey, conducted in February and March 2017, shows that over half of companies still offer some sort of vehicle program. That said, it does indicate that corporate car programs are changing, and the programs of today are not nearly as simple as they once were. Here are some of the emerging trends we’re seeing in company car programs around the world:

Green car policies

“Green” car policies are those that aim to limit the environmental impact of a company’s car program, and they can look different in different regions of the world. For instance, companies located in Europe tend to favor limiting vehicle options to those with lower CO2 emissions, while those in the Americas, Middle East, and Africa aim to reduce emissions by simply limiting the number of vehicles in their fleet. Companies may be making the change to take advantage of tax credits, to exercise corporate responsibility, or engender goodwill within their communities.

Alternative transport options

Going hand-in-hand with the green car approach, alternative transport policies are becoming increasingly prevalent. These solutions demonstrate how benefits are evolving from “car” programs to transportation programs, where employees are encouraged and incentivized to opt for bicycles or public transit as their main means of transport. As jobs move closer into metropolitan hubs and millennials become a greater component of the workforce, companies will continue finding new ways of moving their employees in and out of the office.

Car allowances

Company car programs can be exceedingly expensive, and it’s more than just the cost of the vehicles; companies have to worry about all the administrative and staffing costs of actually implementing a car policy. More and more companies around the world are recognizing these expenses as unnecessary, and many have moved to a simple car allowance policy. Under this type of program, employees simply get a monthly or annual stipend for their transportation costs, and the company gets to sit back and focus on other issues.


Though it may seem like car benefits are beginning to disappear, they’re really undergoing an evolution. This transition from a blanket policy for all employees above a certain career level to a customized solution for each market and job role is progressing at different rates in different regions of the world, but one thing is clear: car policies will last as long as employers need to move their employees from point a to point b.

Interested in learning more about car benefit programs? Don’t miss Mercer’s Car Benefit Programs Around the World, a global report that covers the prevalence, types, and trends in corporate vehicle programs in 48 markets.

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