Hybrid Vehicle Programs 101: What Is It and When Does It Make Sense for Your Business?

What’s a hybrid vehicle program? To answer this great question, it’s a system that unites all your drivers under one easy-to-manage platform. It helps you keep track of everything and control costs by matching each employee to the best reimbursement option for their needs. 

A hybrid vehicle program is defined by a company’s policy and informed by an employee’s job function. It’s a combination of any these types of programs: Cents-Per-Mile (CPM) Reimbursement, Car Allowance, Fixed and Variable Rate (FAVR) Reimbursement, and Fleet. So, what are the primary goals of a hybrid vehicle program?

There may be several primary goals of a hybrid vehicle program. That might include enhancing transparency across the driving workforce, accuracy in reporting, and increased compliance.

How Do Companies Benefit from a Hybrid Vehicle Program?

Companies benefit from a hybrid vehicle program by bringing all their vehicle data into one system, which helps them uncover insights and make smarter decisions. With better visibility and control, they can set benchmarks, track progress, and plan for long-term success. Plus, having a consistent and transparent approach helps align company culture, boosts employee buy-in, and fosters accountability across the board. 

When does a hybrid vehicle program make sense?

If you’re like most businesses, not all your employees have the same job. And if your workforce isn’t uniform, how often your employees drive for work probably isn’t uniform either. Your business likely needs to implement a hybrid vehicle program, but you might not have considered this solution before. Why? It’s likely because you currently have no ability to marry the data or understand the “full picture.” 

Let’s walk through a few examples of when a hybrid vehicle program is the best choice for businesses and their mobile employees. 

The Hybrid Approach for a Medium-sized Pharmaceuticals Company  

A medium-sized pharmaceuticals company has regional salespeople who use company cars for their daily work, while executives frequently drive to meetings and the airport—often several times a month.

To support the executives, we provide them with a $1,000 monthly allowance for their driving needs. For our mobile workforce, we use a handy app that captures mileage through GPS, ensuring accurate logs, and we also conduct Motor Vehicle Record checks and provide driver safety training to keep everyone secure.

On the sales side, we handle personal use chargebacks and reimburse lower-mileage employees using a Fixed and Variable Rate (FAVR) method. Meanwhile, our executives benefit from a cents-per-mile reimbursement rate, making it easy to manage their driving costs.

The Hybrid Approach for a Fortune 500 Consumer Products Company

Let’s talk about how our vehicle reimbursement system works for different teams in the company. We provide company cars to our regional salespeople and executives, while our in-store employees and marketing team get reimbursed based on how many miles they drive. Our Account Managers receive a $600 monthly allowance to help cover their driving expenses. To make things easier for our mobile workforce, we use a handy app that automatically tracks mileage, so everyone can easily log their trips. We also make sure to conduct background checks and provide driver safety training to keep everyone safe on the road.

For the sales team, we keep track of personal use chargebacks and reimburse lower-mileage employees in a straightforward way. Executives have the option to choose between a cents-per-mile reimbursement or a car allowance, but they need to verify their insurance first. The same goes for our Account Managers; they can also be reimbursed either by cents-per-mile or through a monthly allowance, depending on how far they drive. This hybrid approach helps us accommodate different needs while keeping things simple and fair for everyone involved.

Here’s a simple test to gauge if a hybrid vehicle program makes sense for you.

In the chart below, if more than one of the employee personas match your workforce, you should consider a hybrid approach to vehicle reimbursement.

The Bottom Line

In short, business leaders have plenty of options when it comes to managing their mobile workforce and handling mileage reimbursements. Most of these choices can work well, as long as they’re backed by the right tech, data, and insights.

Thinking about checking out a hybrid vehicle program? Find out more about using multiple vehicle programs simultaneously in our guide.

Read the Guide