John Lewis, chief executive of the BVRLA is battling against the negativity being put out by many economists regarding the year ahead. He and his organisation have preferred to focus on the possibilities that 2012 may hold for the industry by producing a ‘Fleet Optimists’ guide to 2012.

Mr Lewis said: “With economic growth slipping across the world and austerity measures biting hard in the UK, business is not going to get any easier in 2012, however, road transport is an essential, not a luxury, and vehicle rental and leasing will continue to gain market share as long as businesses and consumers continue to look for cost-effective, hassle-free motoring.”

Vehicle Registrations: The BVRLA see 2012 continuing in the same way as the previous year, which saw sixty per cent of new car sales being attributed to business registrations. They also see a continued rise in commercial vehicle registration thanks to growth in the courier and home delivery sector and increased demand from contract hire and rental customers.

Mr Lewis commented: “Business users recognise the advantages of buying newer, safer and more fuel efficient cars, but only as long as manufacturers resist the urge to push up prices. We are going to see some very interesting competition below the premium marques, with Korean brands in particular challenging existing fleet favourites including Vauxhall, Ford and the French carmakers with their much improved build quality, low emissions and aftercare offering,”

Funding: The BVRLA say the appointment of new funders last year to should see credit being delivered this year to the independent leasing and rental sectors.

Mr Lewis stated: “These funders are fully engaged with the motor finance market and should hopefully be immune to any further Eurozone-related banking crisis. They will also reduce the industry’s dependence on non-interested parties like Lloyds, who continue to cynically price themselves out of the market.”

Used Market: The BVRLA expect there to be no change in the reducing demand for used cars, however, they foresee residual values continuing to hold as less stock comes into the the remarketing system. Dealers and customers alike will turn to high-quality six-month to four-year-old ex-rental and leasing stock, keeping the new car retail market subdued.

Mr Lewis said: “You only have to look at the way prices held up in the final quarter of 2011, despite some of the pessimistic predictions from so-called remarketing ‘gurus’.”

Rental Market: The BVRLA expect the rental market to see an increase in choice for customers including newer and more fuel efficient models.

Mr Lewis expanded on this saying: “We expect to see even more urbanites turn their back on car ownership and take a pay-as-you-go approach to motoring. “At the same time, we hope that more organisations will take the brave step of tackling the cost-inefficiencies and safety threat posed by their grey fleet, which would also give a boost to the rental sector”

Electric Vehicles: The BVRLA expect 2012 to be the year that EV could really live up to the hype after the disappointing sales of 2011 in this new technology, with just over 1000 Plug-In-Car Grant eligible cars being sold. However, they warn this is only possible if manufacturers are more realistic regarding pricing and the government extends the incentive grant scheme to electric vans as well, making running costs more viable.

Mr Lewis explained: “The new range-extender Ampera and Volt are an attractive prospect for company car fleets, as are the next generation of diesel hybrids and plug in hybrids. Depending on manufacturer allocations, up to 80% of these vehicles could end up on fleets.”

Taxation and Regulation: The BRVLA see last year’s results from the government’s Red Tape Challenge and its announced changes to the DVLA could signal a steady and fairer approach to changes in company car tax CO2 thresholds that would see fleets being able to plan ahead by at least three or possibly four years.

Mr Lewis concluded by saying: “However, as with many government projects, the improvements on offer will take a long time to materialise.The government has just started to wake up to the fact that a successful emission-based tax regime means less revenue for the Exchequer, but we will be alert to any knee-jerk efforts to make up the shortfall.”

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The £32 billion HS2 fund, recently announced by the government has prompted ABD Chairman Brian Gregory to make an alternative suggestion for such a large purse in these times of austerity:

"Imagine what reducing fuel to around £1 per litre would do to kick-start the UK economy, bringing down prices of goods in the shops and taking thousands out of poverty. That is what £32 billion could achieve for more than eight years. £32 billion could have been used to scrap VAT on road fuel altogether for the next eight years plus. That rather puts this colossal sum into perspective. Instead the government are apparently set to completely ignore public opinion and build this white elephant which will only save a few businessmen a few minutes."

Do you agree with the ABD? Do you think this money will be squandered if used for the new high speed train line or do you believe the Government’s statement that it will generate £44 billion of benefits to the UK’s economy over a 60 year period? We want to hear your views, so don’t forget to use the comment box at the end of this article.

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Toyota and Lexus have signed up to epyx’s 1link e-commerce platform as part of its new Fleet Charter. It is hoped this move will prove beneficial to not only service levels but allowing customers greater pricing transparency.

Ewan Shepherd, General Manager of Fleet and Remarketing at Toyota and Lexus, explained: “Delivering a great sales experience to fleet customers is key to Toyota and Lexus and our Fleet Charter is designed to ensure that we are providing pricing and service levels that meet and exceed customer expectations.”

Gary Gibson, Head of Customer Service at epyx said: “We are very pleased to be working with Toyota on this project and look forward to achieving strong results.”

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And finally…

IAM chief examiner and Britain’s top advanced driver, Peter Rodger is this week offering his top tips on saving fuel and money, with green driving able to save you up to 15% on your bills.

Rodger said: “We’ve all got better things to spend our money on than petrol. This will help you save cash and reduce your carbon emissions.”

1. Keep your vehicle moving for as long as possible, even in traffic queues. This is far more fuel efficient than stopping and starting, so slow down earlier, to avoid braking as harshly and often;
2. Stick to the speed limit. This offers a good compromise between economy and getting somewhere. There’s a significant saving made by doing 70 instead of 80 – and you avoid any risk of speeding fines;
3. Reverse into parking bays. If you do all the manoeuvring with a hot engine you can drive straight off when you come back and warm the engine up more quickly;
4. Check your vehicle regularly to ensure it operates efficiently. In particular check the condition of your tyres, and measure tyre pressures when they’re cold;
5. Remove unnecessary weight, including roof racks, car clutter and heavy items in the boot. The more weight you carry in the car, the more fuel you’ll burn;
6. Keep the inside of the front and rear windscreens squeaky clean. Traffic fumes form a film on the glass which attracts moisture and makes them mist up easily – a clean screen will rarely mist up, so you won’t be using the heater and air-conditioning.

Other driving tips, traffic updates and weather forecasts can be found on the IAM website, drivingadvice.org.uk, make sure you check it out before you travel.

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We hope you have enjoyed this week’s selection and hope you’ll take a minute to share your comments on these stories using the comments box below. Make sure you drive safely everyone and we’ll bring you the best news the world of fleet has to offer next week. Until then…

Under the scheme LCVs, minibuses, camper vans, commercial-use 4x4s, and even non-station wagon Land Rover defenders will be brought into the scope of the zone, with owners having to meet the Euro 3 standard for particulate matter in order to avoid a daily charge of £100. Failure to pay the charge will incur a £500 penalty.

The most cost-effective solution could be for businesses to switch to commercial vehicle rental for occasional trips into Greater London.

“People that travel into London on a regular basis will already have plans to replace older vehicles or fit them with particulate filters,” said John Lewis, chief executive of the British Vehicle Rental and Leasing Association.

“It might not make economic sense for them to buy a new vehicle or spend thousands of pounds on fitting a filter because of one or two trips to London, but they could hire a modern, Low Emission Zone-compliant van or truck for a fraction of the cost of paying the LEZ fee.”

From January 2012, trucks will have to meet the Euro IV standard for particulate matter in order to avoid a £200 charge. The penalty will be £1000.

Vans and minibuses registered as new on or after 1 January 2002 and trucks registered as new on or after 1 October 2006 will already meet the new LEZ standards.

The study carried out by TRL and commissioned by the British Vehicle Rental and Leasing Association (BVRLA) found that rental cars tend be newer and as a result, more likely to come with more recent safety technology.

These more recent registrations could also be attributed to the point that rental cars emit 12% less CO2 than the typical fleet car on average.

The BVRLA argues that a rental vehicle is more cost efficient than a privately-owned car due to its highly frequency of use and also believes that renting can help reduce parking congestion in urban areas.

With the cost of motoring surpassing £6,600 a year according to the RAC, BVRLA Chief Exec John Lewis said their findings were timed perfectly.

“It is now clearer than ever that car rental presents a cheaper, safer and more sustainable alternative to car ownership for millions of business and leisure motorists,” he commented.

“We hope that this research will help convince policymakers to give car rental more consideration within the general transport mix.”

Real potential

Transport Minister Norman Baker [pictured] said that the report should shake up the public’s general standpoint on renting.

“For too long, the rented car has seemed like a poor relation to its private counterpart,” he commented.

“Yet this report shows that, in environmental terms, rental cars often represent the cheaper, more efficient and less carbon intensive option.

“What’s more they have real potential to encourage the take-up of new low-carbon vehicle technologies. The Government wants people to travel in more sustainable ways, choosing the low-carbon alternatives that suit them best – whether that means working from home, working more flexibly or sharing a car.

“As this report demonstrates, it’s high time renting a car was added to that menu of options.”

Plus-points

Mr Baker’s viewpoint certainly sits well with Ken McCall, MD of global rental service Europcar, who also believes that the rental route is fine way for people to experience the benefits of EVs and low carbon vehicles.

“Electric vehicles offer huge opportunities for motorists to save money, especially for city driving where they are congestion-charge free and where the stop-start of heavy traffic consumes more fuel,” Ken said recently.

“But for many they are not sure if electric will be truly convenient for them. Car hire is a great way for drivers to put electric to the test.”

Mr McCall added that demands has been steadily growing from business and leisure users keen to tap into the much-touted cost and environmental plus-points.

“Our goal is to give our customers the widest possible choice and that includes giving them access to the new generation of electric vehicles,” he added.

“Ideal for short city journeys, they are already immensely popular with many of our business customers who are making the most of the cost savings they offer. And they’re great for car buyers who want to ‘test-drive’ this latest motoring innovation.”

The BVRLA’s full report can be read online for free at trl.co.uk.

Set to emerge next year, the free notification system has been developed by the BVRLA with the help of the VOSA, Ebbon-Dacs and car manufacturers.

The BVRLA hopes its members would benefit from the reduced financial and administrative headache of notifying fleet owners.

“Our members own and operate more than two-and-a-half million vehicles and finding a cost-effective, easy-to-use solution that the whole industry can adopt has been one of the association’s long-term goals,” commented BVRLA Chief Executive John Lewis.

A new ‘standard’

Alastair Peoples, VOSA Chief Executive, believes the recall system will help make Britain’s comparatively safe roads even safer.

“It’s really encouraging to see manufacturers and the fleet industry working together to improve the effectiveness of the safety recall process,” he said.

With numerous manufacturers on board, the system will act as an all-encompassing one-stop shop for car makers to make their safety recalls public and seen by all.

Simon Oliphant, chief executive of Hitachi Capital Vehicle Solutions and chairman of the BVRLA Leasing and Fleet Management Committee, hailed the system’s conception as “a great example of the industry working together for the greater good – improving safety and duty of care while eliminating a mountain of paperwork and associated costs.”

Robert Pilkington, MD at Ebbon-Dacs – the company assigned to deliver the system, said: “We believe that introducing this new ‘standard’ will help simplify the whole process – leading to greater efficiency and faster safety recall handling in future.”

Fleet managers may be able to test the system as soon as May 2012 with an August launch date pencilled in all being well.

Cunningham has more than 25-years’ experience of the rental industry in Europe and the UK, and has already identified some of the areas he wants the association to focus on:

“We must continue to lobby the government and its motoring agencies to reduce the amount of bureaucracy and paperwork associated with owning and operating fleets.

“I am also keen that we build on our relationships with manufacturers. There have been some tensions in recent times, but we can work through these and develop a longer-term, proactive relationship between our two industries.”

Praising his predecessor, Cunningham said: “Kevin McNally has been an excellent chairman whose energy and positive attitude helped steer the association and the industry through some tough years following the Credit Crunch.”

New leasing chairman

Simon Oliphant, of Hitachi Capital Vehicle Solution’s  has become the new chairman of the Leasing and Fleet Management Committee. David Brennan of LeasePlan becomes vice-chairman after completing his two-year term.

Oliphant believes that the biggest challenges facing the sector are; the cost and availability of funding; proposed lease accounting changes; and the fleet adoption of electric and alternatively-fuelled vehicles.

New leasing broker chairman

Martin Brown of Fleet Alliance takes the reigns as chairman of the Leasing Broker Committee from Mike Lloyd of Central Contracts who has completed his two-year term. Brown said his committee’s principal aims would be enhancing the visibility of the leasing broker sector and ensuring that it has a robust relationship with manufacturers and funders.

But will these new proposals make any difference? Fleet Directory asked some of industry’s key figures.

Julie Townsend, campaigns director at road safety charity Brake, welcomed the crackdown and the idea of re-testing disqualified drivers but felt that the revised approach could slip down the list of priorities as cuts in policing begin to take their toll.

“This proposal will have limited impact without increased investment in traffic policing, which is being drastically cut in many areas,” she said.

“We need the Government to make traffic policing a national policing priority, to ensure we have sufficient traffic  police enforcing vital safety laws, alongside continuing use of proven technology like speed cameras.”

Mrs Townsend also deemed the maximum penalty of £100 as “woefully inadequate” for potentially deadly behaviour.

“We should be encouraging greater respect for the law on our roads, which is in place to protect people’s lives,” she added.

“It is an outrage that the Government proposes such a low penalty for behaviour that can lead to devastating deaths and injuries, when you can be fined thousands for crimes like littering that don’t pose a direct threat to human life.”

Rob Wentworth-James, Head of Sales and Marketing at independent fleet management specialist CLM, hoped the measures would eradicate some of his biggest bug bears.

“As a regular business driver, I’m constantly appalled by the inconsiderate driving behaviour that I see on our roads, and I’d welcome these initiatives to try and improve them,” he said.

Clocking up to 30,000 miles a year on business, Rob would like to think the new rules would wipe out drivers who hog the outside lane.

“It is one of the worst behaviours in my view,” he added. “It is illegal, frustrating and potentially very dangerous –especially as other drivers are then tempted to try undertaking manoeuvres to get past.

Rob expressed concerns whether the measures would be policed affectively: “The only way I can see of achieving this would be by the use of traffic police and backed up by photographic evidence.

“This might prove very difficult, given that many forces are cutting the traffic police expected to police this potential new initiative.

“I would hope this was a genuine attempt on the Department’s behalf to improve driving standards and not simply a set of cynical money-raising measures.”

The BVRLA’s John Lewis was also glad that it would be those deliberately taking risks behind the wheel that would be punished.

“It is better that enforcement is focused in this area rather than at motorists who may just creep a couple of mph over the speed limit but not cause any danger,” said the BVRLA Chief Exec.

“As far as the police are concerned there is already a broadly accepted speed limit of 80mph on the motorways. This should be made consistent so that a motorist doesn’t pass a police car at 80mph only to be flashed by a speed camera on the next bridge.

“However, the police need to make sure that they enforce any new limit and that 90mph doesn’t become the new 80mph. And, of course, they also need to be given the resources to do their job.”

Martin Hill, operations director at fleet management supplier Fleet Logistics, said that he thought the new proposals would contribute significantly to road safety.

“A high priority for any business is to ensure that their employees are operating in a safe environment in particular whilst driving. Any initiative introduced to make the roads safer and reduce the accident rate must be seen as a positive step.

“Fleet Logistics, both as a responsible employer and a major fleet management company across Europe, welcomes this move as it will influence drivers to drive more safely and courteously without adding any unnecessary administration burden to employers or fleet operators.”

Neville Briggs, MD of CFC Solutions, also questioned how the new rules would be enforced.

“There is some merit to the idea, however, it seems to combine two ideas that have proven very unpopular with voters – on the spot fines and driving fines,” he said.

“At present, statistics covering company car and van drivers from our Licence Link licence checking software indicates that around one in five have points on their licence. This could rise quite quickly with on-the-spot fines and create something of a risk management headache for fleet managers.

“The question is whether such a policy would change company car and van driver behaviour? Would it make them less likely to tailgate or undertake? It is quite a difficult point to answer.”

The IAM’s Simon Best welcomed the prospect of extra training for novice drivers.

“Many young drivers crash simply because they lack driving experience,” he explained.

“Extra training with in-depth coaching and more hours behind the wheel will prevent accidents and save lives. We will work with the government and the insurance industry to make this new approach a reality.

"A strategy that punishes deliberate bad driving while allowing those who make simple human errors to improve has our full support. But we are concerned that issuing spot fines for careless driving could downgrade the offence and we will be monitoring the impact carefully."

Set up by the British Vehicle Rental And Leasing Association (BVRLA), the Funding Steering Group aims to tempt lenders back to the leasing and rental market and is said to be dealing with several funders already to outline opportunities and break down any barriers.

“Our industry has coped with this squeeze and now it’s time to help lenders return to the market and explore new funding opportunities,” said John Lewis, Chief Exec of the BVRLA.

“This group has been created to help replace some of the liquidity lost since the Credit Crunch as banks have struggled to build up their balance sheets and improve their flow of lending.”

Talks have been promising so far, Mr Lewis revealed.

He added: “From the conversations we have had with potential lenders already, I am confident that there is new finance available for leasing and rental companies.”

The steering group is chaired by BVRLA honorary treasurer and board member Brian Back and includes representation from the association’s three key sectors of membership: Graham Hale of Fleet Hire, Andrew Cope of Zenith Provecta, Roger Hancock of Thrifty Car Rental and David Barlow of ProHire.

A funding survey will be carried out by the group over the coming months.

“We want to get a clear understanding of which sort of finance they want to provide and what sort of companies they want to deal with,” added Mr Lewis.

“The information we get from the survey of members will help us point them in the right direction.”

Under the new Continuous Insurance Enforcement rules, registered keepers of uninsured vehicles will be hit with a £100 fine if written warnings go ignored. The vehicle could then be seized or even destroyed if it remained uninsured.

Leasing and rental firms will be held accountable for making sure their vehicles are insured and subject to any fines that come along with failing to maintain them insured on the MIB’s Motor Insurance Database. Fines would not be transferable to customers.

However during a recent British Vehicle Rental and Leasing Association seminar, David Hancock [pictured], Director of Enforcement at the DVLA, said that they needed to work with the industry in order to do all they could to ensure members of the BVRLA were not victims of any unintended consequences of compliance.

“All our members will comply with the law, but the less administratively burdensome we all can make it the better,” responded Nora Leggett, the BVRLA’s head of member services.

Just how parts and components on models such as the Nissan Leaf will fare is still very much a guessing game and with limited information on vehicle performance and warranty terms, the vehicle rental and leasing industry is now urging car manufacturers to supply fleets with more detailed operational guidelines for EVs.

Electric vehicles may be able to hold their own next to conventional models [full story], but John Lewis, BVRLA’s Chief Executive, stressed that few fleet managers will be keen to snap them up before being convinced that they are financially viable.

“The vehicle rental and leasing industry recognises the urgent need for fleets to adopt ultra-low carbon technology and is working hard to facilitate the shift,” he said.

“BVRLA members can be great advocates for the move to electric motoring, but we need to look beyond the short-term taxpayer funded incentives and marketing hype surrounding electric vehicles and find some of the answers that will enable early adopters to have the confidence to take on EVs in volume.”

Blueprint

At a recent EV event, BVRLA delegates were eager for information on how rapid charging could affect a vehicle warranty, the pricing and availability of parts including refurbished batteries, and will manufacturer handbooks contain enough information to keep fleet drivers aware of the different usage requirements of electric vehicles?

“Due to a lack of historic information, we are out of our comfort zone as we are unable to rely on factual information, including gut instinct,” explained Phil Turle, Fleet Services Controller at ALD Automotive.

Aside from roadtesting a few EVs, Phil said that he has shaped a blueprint to their reliability and usage by going off how his fleet’s Toyota Prius hybrids had performed.

Mr Lewis concluded: “We will see a number of electric evangelists making impulse purchases, but the vast majority of fleets will need reassurance that these vehicles are fit for purpose and that it makes financial sense to run them.”

John Lewis, Chief Exec of the British Vehicle Rental and Leasing Association, said Penning, the man in responsible for the motoring agencies, was on the same wavelength when it came to how the work of the DVLA and VOSA could be streamlined and modernised.

“It was very encouraging to hear that the government shares our view on how these agencies can improve the way they deal with their corporate customers,” said Mr Lewis.

“The minister made it clear that the DVLA must move quickly to drop its reliance on paperwork and start delivering efficient, electronic-based services.

“He also agreed with us that VOSA should carry on exploring the role industry can play in improving vehicle testing and compliance – thus enabling more targeted enforcement.”

It is hoped these types of meetings will become a regular occurrence.

The BVRLA will continue to push its messages through its attendance at the Department for Transport’s Motorists Forum, VOSA’s ‘Stanmore Group’ and the DVLA’s Industry Liaison Group.

The programme is available to staff at leasing brokers that are currently members of the British Vehicle Rental and Leasing Association.

After registering, staff are granted access to online learning material before taking the accreditation test.

Topics covered include corporate and industry governance, regulatory compliance, business vehicle acquisition methods, sales techniques and a glossary of industry terms.

Promote standards

The BVRLA reckon that staff with six months in sales could be ready for the 40-minute test with just two or three hours study.

“The accreditation met all the skills and knowledge required in my current role,” said Jen Crombie, an account manager at Fleet Alliance, who completed the programme during its pilot phase.

“This programme will play an important role in helping the sector to promote the high standards being delivered by BVRLA leasing brokers,” said Mike Lloyd, chairman of the BVRLA Leasing Broker committee and managing director of Central Contracts, which has already enrolled three members of staff on the accreditation scheme.

The accreditation lasts for one year. For more info, visit bvrla.co.uk.

Pump prices may still skin you more than you’d wish but the Budget announcement could have been worse, much worse.

As with every Budget, talking heads are turned up to 11, but FleetDirectory.co.uk has gone to the trouble of picking out the views of those who matter.

John Lewis, Chief Exec with the British Vehicle Rental and Leasing Association was relieved that the government had delivered a Budget that “at last, offers something for motorists”.

“His fair fuel stabiliser is ingenious, shifting the burden of taxation upstream when crude oil prices increase,” he said.

“Whether you are a haulier, a fleet manager, a commuter or a just someone trying to keep your family car on the road, this imaginative tax measure will have an instant impact on your weekly cash flow. For many it will be more important than all the other tax announcements put together.”

However, the decision to maintain the 3% diesel surcharge within the company car tax regime left Mr Lewis disappointed.

“This discriminatory tax against diesel fuel is totally out-of-date and needs to be abolished,” he added.

“We would go even further and call for the government to investigate the continuing differential between diesel and petrol prices at the pumps which is nothing more than exploitation of business motorists and haulage companies.”

Business friendly

The reduction in corporation tax by 2% from April 1 then by 1% in each of the following three years would benefit the transportation sector and encourage growth in the UK economy, said Jakes de Kock, Sales and Marketing Director with The Fuelcard Company.

“We’ve been stagnant too long and need stimulation such as this to begin growing again and make the UK a true ‘business friendly’ location,” he reckoned.

“Various tax incentives including a cut in corporation tax can only have a steady long-term positive impact,” added Roddy Graham, Commercial Director with the Leasedrive Velo Group and Chairman of the ICFM.

“However, more investment is required in properly engineering and maintaining our road network infrastructure. We risk rapidly turning the main arteries of UK PLC into a rocky road.”

Reducing fuel duty was a “welcome break” for motorists and businesses said Peter Rodger, the IAM’s Chief Examiner.

“However, eco-driving is the only guaranteed way to reduce motoring costs,” he added. “It’s no longer an ethical choice, it’s a money-saving essential – especially in rural areas where driving is a necessity. The best fuel-saver is a light right foot and anticipating the road ahead.”

ACFO Chairman Julie Jenner also welcomed the penny cut but questioned the longevity of its effect: “It remains absolutely essential that all fleet decision-makers continue to focus on cost management.

“It is difficult to believe that with the unrest in the oil producing countries of North Africa and the Middle East that fuel prices will fall significantly in the short term.”

Julie added that she would have liked to have seen a restructuring of AMAP rates (Authorised Mileage Allowance Payment): “A more subtle approach instead of the current two-band, single mileage threshold system in place is worth analysing.”

Gary Killen, Commercial Director with GE Fleet Services UK, agreed saying the 1p decrease would be “quickly swallowed up” in future fuel price rises.

On the previously publicised decision to invest £100m into addressing potholes, Neil Greig, Director of Policy and Research with the IAM said: “The extra investment in roads is welcome but it is not enough to cure Britain’s pothole pandemic. We need to ensure that roads are properly looked after so we don’t store up bigger maintenance bills for future.”

Middle of the road

Ken Trinder, head of business development at epyx – IT solutions specialists for the automotive sector, felt the Budget was too “neutral” and could have gone further.

He explained: “The fleets and dealers that we work with have become extremely lean and focused during the last two years and, having survived the recession and maintained or regained worthwhile profitability, are facing the future with a limited but definite sense of optimism.

“There is little in this fiscally neutral Budget that looks as though it will substantially change that outlook in the short to medium term, despite the ‘feel good’ news on fuel duty. The Chancellor’s plans to encourage growth and investment such as the corporation tax cut are welcome but, if they do have an effect, it will not be for some time.”

Geoff Dunning, the Road Haulage Association’s Chief Executive, said all the campaigning for fairer fuel had “paid off”.

“It makes a welcome change for a Chancellor to not only listen, but to take positive action,” he said.

Simon Chapman, Freight Transport Association’s Chief Economist, also agreed that the 1p cut was “a key win” and the decision had effectively saved industry £125m this year.

“Clearly, Mr Osborne has listened to our concerns and recognises that for economic growth to be sustained, then freight transport is needed to keep shop shelves filled and businesses supplied,” he explained.

“Times are incredibly tough in the logistics sector right now, with carriers unable to recoup rising costs and facing a cash flow squeeze.  The Chancellor is right to recognise that going ahead with an above inflation fuel duty policy would have been suicidal for the UK’s economy. His decision to keep VED levels unchanged shows how intently Government has listened to us, for which they should be congratulated.”

Magic trick

Neville Briggs, MD of Pinewood Computer Solutions, said that George Osborne has “pulled a rabbit out of the hat” by lowering fuel duty.

“But there is really nothing in the Budget that prompt dealers or manufacturers to consider the remainder of 2011 in rosier terms than before, especially considering general factors such as the reduced growth forecast, rising inflation and high unemployment,” he added.

“However, dealers have become impressive since the recession in their ability to exploit almost every opportunity in new cars, used cars and aftersales. For that reason, many are mildly optimistic about their prospects in the medium term.”

Plans to support more apprentices and enhance capital allowances were good news to the ears of SMMT Chief Executive Paul Everitt.

“Budget 2011 recognised the strength of the UK manufacturing sector and its ability to steer our economy out of recession,” he said.

“We are pleased to see that the Chancellor’s plans have a strong focus on manufacturing and making the UK an attractive place to invest.

“The outlook is certainly still challenging, but we are encouraged by the impact these measures will have on our sector and the wider economy.”

Tony Hulatt, MD at independent fleet management specialist CLM, was also pleased by the increase for business mileage reimbursement from 40p to 45p.

“This was an interesting move and while it remains uncompetitive because of the fuel increases we have witnessed, it gives more weight to the return to company cars.  However, I do think that this is at odds with previous statements about reducing business mileage in private cars,” he said.