Company Car Today


This glossary is designed to be a live point of reference that enables fleet decision makers and company car drivers to understand the terminology, technology and acronyms used within the UK automotive fleet sector.  The list is not exhaustive and will continue to develop inline with UK fleet sector.


ACEA is the European automobile manufacturers’ association, representing vehicle firms with European production bases on issues including connected and automated driving, environment and sustainability, safety, transport policy and other areas where legislation will impact upon vehicles. Its mission includes acting as advocate for the common interests, policies and positions of the European auto industry.



Formerly known as the Association of Car Fleet Operators prior to a rebrand several years ago, ACFO is the trade association offering help, support, knowledge and training to fleet operators, a group that increasingly includes members where fleet is just one part of their job. Headed by Arcadia Group fleet and travel manager John Pryor, the association holds various seminars and events through the year, and more information can be found at



This is an addition to distance-keeping cruise control systems. Such active cruise systems keep your car a set distance from the car in front on the motorway. However, an active stop and go set-up will bring the car to a halt when traffic ahead stops, and then set off again when the traffic moves, all with no, or limited, pedal input from the driver.



Advanced Driver Assistance Systems is the overarching name for the increasing number of assistance technologies being developed for modern cars. These include everything from adaptive cruise control and lane-keep assist to parking sensors, automatic lights and wipers and hill decent control, and use increasing numbers of sensors, radar and cameras fitted around the vehicle.



One of several technologies that are paving the way to full driverless cars, adaptive cruise control works like regular cruise in maintaining a set speed, but combines that with a front-mounted radar that will slow the car when it senses a slower vehicle ahead, accelerating back to the set speed once the other traffic has cleared.



Autonomous Emergency Braking is the safety system that will intervene when it detects a low-speed accident is imminent and apply the brake to avoid or mitigate a collision. Fitted as standard to 61% of new cars last year, according to Thatcham Research, the system brings a reduction in insurance group and safety organisations are campaigning for buyers to only consider cars with AEB fitted.



The Advisory Fuel Rate is the figure for reimbursing drivers using company cars for work mileage, or the figure drivers reimburse for private mileage if companies pay all fuel. Set quarterly by HMRC, there are three different rates depending on engine size for petrol, diesel and LPG-powered vehicles, ranging from 7p-21p per mile. Company Car Today publishes the latest rates every fortnight. For the latest AFRs click HERE



Approved Mileage Allowance Payment rates are the Government-set pence per mile figures for reimbursing employees for mileage driven on company business. Designed to cover the wear and tear, business insurance cost and depreciation of the mileage driven as well as the fuel cost, they are a flat rate of 45p per mile for the first 10,000 miles, dropping to 25p per mile after that to discourage higher mileage that could warrant a rental or company car. For the latest AMAPs click HERE



Autonomous, or self-driving, cars are in development from most major manufacturers, as well as technology companies such as Google. There are five stages of automation, going from the likes of aids such as adaptive cruise control and Lane Keep Assist systems through to the fifth stage, which is cars that won’t even have a steering wheel or pedals.



Benefit-in-Kind taxation is the way company car drivers are taxed on their company cars. It’s a monthly figure worked out from an equation combining the P11D price of a vehicle and its CO2 emissions figure – P11D price x BIK band % x 20%/40% depending on income tax bracket. The Government publishes a table based on CO2 bands (see left), with drivers currently paying between 9% (sub-51g/km) and 37% (190g/km+), which changes at the beginning of every tax year. For the latest BIK tables click HERE



BLIS is short for blindspot detection systems, which are tiny cameras and sensors mounted on the side of cars that illuminate a little light in the wing mirror when there is another vehicle in the car’s blind spot – that little gap when another car disappears from the wing mirror and before it comes into peripheral vision. BLIS generally forms part of the suite of car safety systems, either as standard or as an option.



The British Vehicle Rental and Leasing Association is the organisation that represents lease companies and car rental firms. Established in 1967, its 900+ members operate around 4.7m cars, vans and trucks, and the association, headed by chief executive Gerry Keaney, lobbies on the regulation and legislation affecting the industry across transportation, taxation and finance issues.



Carbon dioxide (along with other gases) is produced when an internal-combustion engine is running.  In the UK, each car’s CO2 emissions are carefully measured and quantified so that the car can be placed in a taxation ‘band’. Basically, the more carbon dioxide your company car emits, the more you shell out to the exchequer each month.



The offence of corporate homicide (corporate manslaughter in England, Wales and Northern Ireland) is a relatively new one, having only become law in 2008.  Under it, a corporation can be held liable, and so punished, for conduct that leads to someone’s death, such as if health and safety procedures have been ignored.



The offence of corporate manslaughter (corporate homicide in Scotland) is a relatively new one, having only become law in 2008.  Under it, a corporation can be held liable, and so punished, for conduct that leads to someone’s death, such as if health and safety procedures have been ignored.



Another new piece of clever technology, cross traffic alert is best described as having somebody to help you reverse out of a parking space. It alerts the driver to traffic approaching from either side, to prevent the driver reversing into its path through a warning alarm. Most manufacturers now offer a version of the system as part of their safety bundle.



This allows the vehicle to maintain a set speed without the driver having make any inputs using the accelerator. Cruise control can be cancelled either by touching the brake pedal or using the button/column stalk that controls it. The driver can then operate the ‘resume’ function and the car will accelerate back up to the previously set speed.



Still the logical choice for higher-mileage drivers, especially now with RDE2-compliant diesels that can avoid the four-band BIK tax penalty. 



Driver Attention Alert (sometimes also called Driver Attention Warning (DAW) monitors a driver and works out when they’re becoming weary. Such systems keep an eye on how often the driver is blinking, and for how long, as well as steering inputs, and the length of time driven. If it senses a driver getting tired, it advises them to stop for a break.



The Driver and Vehicle Licensing Agency holds 48 million driver records and over 40 million vehicle records, collecting around £6bn per year in Vehicle Excise Duty. Its responsibilities include recording driver endorsements, disqualifications and medical conditions, issuing licences and vehicle registration certificates, and recent advances include online licence checking.



The Driver and Vehicle Standards Agency replaced VOSA – the Vehicle and Operator Services Agency in April 2014, and is the organization tasked with carrying out driving tests, approving MoT test centres, carrying out roadside checks on drivers and vehicles and monitoring vehicle recalls. Stated aims include increase the number of serious roadworthiness defects and traffic offences by 15% during 2018.



This is when a customer ends their lease contract before the contracted term is up. To do this, the lender calculates a set fee, which the customer must pay before they return their vehicle. Such fees can be quite significant, so anyone considering Early Termination would be well advised to find out how much these costs are before ending the contract.



Electric vehicles, or EVs, are seen by many as the long-term solution to local air pollution issues. Powered solely by a battery electric motor, the pioneer from a range perspective is Tesla, which can manage nearly 400 miles on a charge, though most mainstream brands are at 100-200 miles. Top sellers include the Nissan Leaf, Renault Zoe and BMW i3.



Powered by battery alone, with a range varying from just over 100 miles to around 300 between charges. These cars sit in a 0% BIK tax band for 2020/21.



If you’re planning to lease a new car, you must remember that the cost you pay each month is worked out on the amount of deposit you pay in the first place, and also a total mileage figure the car must not exceed. Should you do more miles than allowed in your contract, the company will charge you a set penalty for every extra mile.



The European New Car Assessment Programme is the body that crash-tests new cars, giving them a rating out of five. The test is frequently tightened to take account of improving standards, recently adding active safety systems to the consideration, such as autonomous emergency braking. It has also started downgrading older cars still on sale that no longer warrant the original scores.



Fair wear and tear is the deterioration of a vehicle over the length of a leasing contract that can be put down to normal usage and therefore isn’t damage a user can be charged to rectify. It doesn’t cover damage to the vehicle caused by the likes of neglect, poor treatment or missing items. The BVRLA has a fair wear and tear guide that leasing companies use as an industry standard.



The Fleet Operator Recognition Scheme is designed to help fleets prove their commercial vehicles, across vans and trucks, are operating in as safe and green a way as possible. A voluntary accreditation scheme promoting best practice, FORS now has more than 4900 members covering 122,000 vehicles and offers Bronze, Silver and Gold membership levels.



The Freight Transport Association is the organization that argues the case companies moving goods in the UK across representation, campaigning, compliance and training. Although focused more heavily on trucks, the FTA also has a Van Excellence programme aimed at improving standards for light commercial vehicle drivers and operators.



 Hydrogen fuel cell vehicles emit nothing but water and can be refuelled in the same time as a petrol or diesel. Still rare though. 



Go Ultra Low is a joint Government and car industry campaign backed by leading plug-in brands Audi, BMW, Hyundai, Kia, Nissan, Renault, Toyota and VW, as well as the SMMT, and its aim is to promote greater uptake of ultra low emissions vehicles among fleets and private buyers by promoting the financial and environmental benefits. It includes a Go Ultra Low Company accreditation for fleets pledging to be at 5% ULEV by 2020.



This is when the employee’s own vehicle is used for work business. These vehicles are harder to manage, but if employees need to use them for their job, the company needs to know they are insured, taxed, have a valid MoT, have been serviced and are fit for purpose. The company also needs to have checked that the driver has a valid licence.



One of many new technologies coming onto more and more cars, High-Beam Assist automatically adjusts a car’s headlight main beams, flicking them up to give greater visibility in the dark, but automatically dipping them when it detects traffic either ahead or oncoming. The advanced systems can also use LEDs to dip certain patches to maintain maximum visibility without dazzling oncoming drivers.



This is a government-run body that used to be known as the Highways Agency, and it’s responsible for the maintenance and improvement of all the roads in England, apart from in London, which is looked after by Transport for London (TfL). The roads in Scotland are looked after by Transport Scotland, while the Welsh Assembly sees to Wales.



Hybrid vehicles combine an electric motor with diesel or, more commonly, petrol engine. Pioneered by the likes of Toyota and Honda, the system is entirely self-contained rather than plug-in hybrids that are recharged from the mains. Full hybrids get their charge from energy recovery when the car slows, and they can generally run for around a mile on the battery alone.



The Internal Combustion Engine is the collective name for petrol and diesel powertrains, repeatedly threatened by newer propulsion such as full electric and plug-in hybrids. It’s full ICE vehicles, those without any sort of plug-in technology, that are being threatened with bans from cities across Europe, and that the Government has said won’t be sold from 2040.



ICFM, formerly known as the Institute of Car Fleet Management is the industry’s training body, offering a range of development and training courses aimed at promoting excellence in the industry. Formed in 1992 and headed by chairman Paul Hollick of The Mileage Consultancy, ICFM runs a series of seminars and events through the year, as well as the training that culminates in an advanced car fleet management diploma.



This is a standalone system that can form part of an active cruise control set-up. The car uses a combination of road sign recognition and GPS to assess the speed limit of the road it’s on, then prevents the car from exceeding that speed. However, the driver can over-ride the system with a hard push in the accelerator.



Lane Keep Assist, or LKAS, is a system that prevents a car from drifting out of its lane. Effectively an early step on the route to full autonomous driving, the cars use a camera to track the white lines either side of the car, and while early systems called Lane Keep Alert simply beeped or vibrated steering wheel or seat, the newer systems actively steer the car back to the centre of the lane.



Lane departure warning uses a camera system to detect white lines and alerts the driver when they are drifting out of their lane, either through beeping, vibrating the steering wheel or vibrating the seat, depending on the car. LDW is a level below Lane Keep Assist systems that actively steer the car back into the centre of its lane.



This is the most basic level of automation, and has actually been around for some considerable time. It’s when a solitary element of the driving process is taken over by computer, and can include tasks such as keeping the car a set distance from the vehicle in front using radar, or even steering gently to keep the car in one lane.



This is the level that car manufacturers have reached today. Basically, this entails the car controlling more than one function of the driving process. High-end manufacturers now have cars that can control some steering and speed functions, while self-parking systems and cars that drive themselves in traffic jams also come under the Level 2 banner.



We’re not quite there yet, but we’re getting there. Basically, this is the tipping point at which the car takes over the driving, and reacts in safety-critical situations. However, the driver still has to be in position at the wheel, ready to take over control when the situation demands it, or when the car asks for it.



This will be the next big step, but it’s a few years off at the moment. Basically, this is the point at which the driver becomes non-essential, so you’ll be able to sit in the back while the car drives you around. At first, it’ll only work in urban areas that have been duly geofenced and will entail car-to-car communication and HD mapping, but it’s coming…



We’re told this will be motoring nirvana, because it’ll take the driver out of the equation. In fact, there won’t be any need for internal controls, so the car will become, in effect, a meeting room on wheels. It will require a massive amount of data, but will be able to go anywhere, avoid everything, and the traffic data could also bring an end to jams.



Low Emissions Zones will become more common in the coming years as local councils are tasked with addressing local air pollution issues. At present the only one is in London, and older and dirtier vehicles are charged to enter the zone, depending on the European emissions standard they conform to, but more than 30 UK towns and cities are under pressure to reduce air pollution.



An emissions-reducing step for internal combustion engines, the mild hybrid system is a small battery fitted to regular petrol or diesel cars that car be charge through regenerative braking to offer a little boost of power, fuel ancillary elements or run the car at low speed. The technology is expected to spread across all cars in the coming years.



Administered by the Driver and Vehicle Standards Agency, the MoT test – standing for Ministry of Transport test – was first introduced in 1960 and requires all vehicles to take an annual roadworthiness test once they reach three years old, which the Government is considering changing to four years, or one year for ambulances, taxis or vehicles with at least nine seats.



These are the nitrogen oxides that play a significant part in air pollution. They are generated  by a reaction between nitrogen and oxygen that occurs during the combustion process in a car’s engine. When NOx combines with and reacts with volatile organic compounds, the formation of smog is the result. Basically, it’s nasty stuff.



The Optional Remuneration Arrangement rules kicked in for the 2018/19 tax year, and apply to employees that are offered a choice of car or cash allowance, or a salary sacrifice car arrangement if the car is over 75g/km for CO2 emissions. From April 2018, the taxable benefit is deemed to be the higher of the two values – either the cash sum or the level of BIK from the company car.



The P11D price of a car is the important bit for company car drivers, because it’s what they’re taxed on. The P11D value of a car is the list price plus delivery cost, but doesn’t include Vehicle Excise Duty or first registration fee. What it does include though is any options – the driver will be hit by BIK tax on the boxes they tick for additional kit.



These are also known as atmospheric particulate matter.  They often occur naturally around grassland fires and volcanoes, but they are also produced when fossil fuels are burnt, such as in power stations and in internal combustion engines.  These have been linked to higher rates of respiratory complaints and a raise in some cancers.



Personal Contract Hire is a long-term vehicle rental agreement for private individuals, and is becoming an increasingly popular way for private individuals to fund new car purchases. Like businesses leasing vehicles, the individual pays an up-front cost and then a monthly rental, with payments defined by length of contract and agreed mileage, with penalties for exceeding the latter.



The most popular fuel for more than a century, petrol is enjoying a resurgence in the wake of diesel’s environmental criticism. Downsizing and turbocharging has increased efficiency. 



Plug-in Hybrid Electric Vehicles combine a battery and electric motor with either diesel or more commonly petrol engine. The technology avoids the range anxiety of a pure electric vehicle by offering the back-up of a petrol engine once the battery is used up, but the ability to run up to around 30 miles, depending on model, on pure EV power.



Combines a petrol or diesel engine with a battery capable of powering the car on its own for between 20-40 miles. Sub-50g/km cars get a big company car tax advantage. 



RDE2 came to prominence in November 2017 when the chancellor decided any diesel not meeting the Real Driving Emissions 2 standard would be subject to a four-band increase on company car BIK tax. Which, at present is every diesel on sale, with cars expected to be at least a year away.  RDE2 relates to the amount of NOx a car is allowed to put out on the road versus the laboratory test.



Basically, this is what happens to a fleet’s vehicles at the end of their lease term.  Typically, a fleet’s vehicles are disposed of through the auction system, which makes it all the more important that the vehicle is fitted with the correct (i.e. the most desireable) equipment in the first place.  This is vital to a vehicle’s remarketing value.



Combines a petrol or diesel engine with a battery capable of powering the car on its own for between 20-40 miles. Sub-50g/km cars get a big company car tax advantage. 



Doesn’t need plugging in, but can generally only propel the car under battery power for around a mile. 



The Society of Motor Manufacturers and Traders is the car, van and truck industry’s voice, fighting its corner across all issues that affect the production, sales and operation of vehicles in the UK, both to Government and decision-makers and to the public. It is also the organisation that collates and publishes the monthly vehicle sales figures.



SMR stands for Service, Maintenance and repair, which is an important part of the whole life cost equation. It’s a figure that includes the cost of however many services the vehicle is predicted to need over the set term, three years and 60,000 miles for example, as well as forecast maintenance and repair, including elements such as tyre replacement.



There are strict rules governing the number of driving hours commercial goods vehicle drivers can do in any given period, and the tachograph is how this is recorded. A tachograph (digital from 2006) records all the vital information, including time spent at the wheel, miles covered, and breaks taken.  This tachograph plays a vital part of an employer’s duty of care to the employee and other road users.



The Toxicity Charge is a toll that we’re likely to see more of as we move forward. Currently only operating in London, the T-Charge uses the same boundaries and operation times as the London congestion charge, and at present any vehicle not meeting Euro4 emissions standards has to pay an additional £10 to drive in the capital.



An Ultra Low Emission Vehicle is one  that qualifies for the Government’s grant for vehicles emitting less than 75g/km. With the exception of the Hydrogen Toyota Mirai, all are either pure electric or plug-in hybrid, and to get the grant of at least £2,500 need to travel zero-emission for in excess of 20 miles. More information is available at



Vehicle Excise Duty is colloquially know as road tax, and has to be paid on all vehicles using the road. For cars, there’s an initial fee at first registration that ranges from £10-£2,135 depending on emissions, after which it reverts to a flat £145 fee. For pre-April 2017 vehicles it’s a much simpler emissions-based system.  For the latest VED tables click HERE



Knowing the whole-life cost of vehicles allows companies to choose their next fleet options based on a great deal more than just the basic monthly rental cost. That’s because the whole-life cost includes extra expenditure variables such as insurance, SMR, residual values, taxation rates, CO2 emissions and, of course, the sort of fuel economy the vehicle is likely to achieve. 



In a bid to reduce congestion, some councils are considering following Nottingham’s lead, where there is a levy on employers who provide 11 or more parking spaces for their employees. The firm can pay the levy itself, or pass on the cost. The annual cost is £375 per space, and rules stipulate that any money raised must be spent on local transport.



A Zero Emissions zone will be one that only cars with no tailpipe emissions will be permitted to enter, going much further than the Low Emission Zones proposed for various cities around the world. The first one is being proposed for Oxford, where petrol and diesel vehicles would be banned from certain streets from 2020, rolling out to the whole city over the following 15 years.