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How would you place value on a company vehicle as part of compensation package
Posted on 1/11/20 at 12:11 am
Posted on 1/11/20 at 12:11 am
A company here locally is interested in hiring me and they haven't mentioned anything about salary yet (really just talked to the HR person reviewing the resumes) but she did mention that this position would come with a company vehicle (I'm assuming a truck)
The commute is ~35 miles each way which is essentially what I'm used to anyway so no change there (typical 5 day work week)
Current car situation - 1 vehicle that's already paid off. It has high enough mileage where depreciation isn't really worth considering
No word yet if I would be able to use the vehicle for personal use or if it is strictly for business purposes. I'm assuming they'd also cover fuel as it's a regional management position.
Is there an easy way to put a dollar amount on this benefit? I'd essentially just be saving fuel, maintenance, and repair costs on current vehicle and it would of course mitigate the need for me to buy a more current vehicle for a bit longer.
The commute is ~35 miles each way which is essentially what I'm used to anyway so no change there (typical 5 day work week)
Current car situation - 1 vehicle that's already paid off. It has high enough mileage where depreciation isn't really worth considering
No word yet if I would be able to use the vehicle for personal use or if it is strictly for business purposes. I'm assuming they'd also cover fuel as it's a regional management position.
Is there an easy way to put a dollar amount on this benefit? I'd essentially just be saving fuel, maintenance, and repair costs on current vehicle and it would of course mitigate the need for me to buy a more current vehicle for a bit longer.
5
Posted on 1/11/20 at 6:18 am to Powerman
I guess it can depend on the car. The company I work for offers new Ford F-150 crew cabs to the field guys ($42,000 sticker price). They can use them for work or personal (just have to pay taxes on the personal miles, that’s all). I tend to say that that F-150 represents about an additional $10,000 in compensation.
Eta, you can head to the TrueCar website . They have some cost estimates as well.
Eta, you can head to the TrueCar website . They have some cost estimates as well.
This post was edited on 1/11/20 at 6:20 am
Posted on 1/11/20 at 5:10 pm to crazycubes
Well I don't get to keep the car
I suppose I'm just trying to calculate a value based on the reduction in maintenance and repairs on current vehicle and fuel savings
I suppose I'm just trying to calculate a value based on the reduction in maintenance and repairs on current vehicle and fuel savings
Posted on 1/12/20 at 11:41 am to Powerman
The company car has to stay at the office? Commuting is done on a personal car?
Posted on 1/12/20 at 11:58 am to Powerman
quote:
No word yet if I would be able to use the vehicle for personal use or if it is strictly for business purposes.
I think you have to have this answered, because this would be a huge difference.
If it is just to get back and forth to work and any required travel for official duty? That's just maintenance (and gasoline if they pay for that.)
If you can have some reasonable level of personal use (in other words, you don't "need" a car for yourself while you are in the job), then I would value that closer to $400 or $500 a month.
Now, if it is negotiable, I would always prefer a car allowance rather than the actual car - you can monetize that. But, if this is what it is, it is either a pittance or a pretty good benefit depending on the personal use question.
Posted on 1/12/20 at 5:18 pm to Powerman
The company I work for offers managers either the car allowance of about $900/month or a company truck.
With the car allowance, they also pay for fuel (personal use too), monthly car washes and oil changes, but it's taxed as income. So you have to pay for insurance and maintenance.
With the truck, you get it all...company insurance, fuel, car washes, and obviously maintenance. You're taxed on use of personal miles reported.
Over the past few years there has been a rush of people swapping from truck to the allowance. But, they will have to force me out of a company truck...the math doesn't add up to take the allowance, just so you can drive what you want. I'll just keep driving what they give me for free.
With the car allowance, they also pay for fuel (personal use too), monthly car washes and oil changes, but it's taxed as income. So you have to pay for insurance and maintenance.
With the truck, you get it all...company insurance, fuel, car washes, and obviously maintenance. You're taxed on use of personal miles reported.
Over the past few years there has been a rush of people swapping from truck to the allowance. But, they will have to force me out of a company truck...the math doesn't add up to take the allowance, just so you can drive what you want. I'll just keep driving what they give me for free.
Posted on 1/12/20 at 6:22 pm to MaxDraft
I would think between $750-$1000 a month is the value I would place on it.
Posted on 1/12/20 at 7:24 pm to Powerman
I drove a company car for the first 17 years of my career and have had allowances since. I would not take either into consideration when negotiating a new job offer. If the company hits hard times, these perks are the ones that are often taken reduced or taken away completely.
But if you really want to consider the total compensation, you would have to ask more questions such as about the personal use.
But if you really want to consider the total compensation, you would have to ask more questions such as about the personal use.
Posted on 1/13/20 at 6:14 am to Powerman
Personally, I don’t want - I always negotiate an allowance instead. Company cars often come with payroll deductions, tax implications, weird restrictions, and cumbersome reporting, or a combination of these. Plus, an extra car is sort of a burden if you already have one.
The way I see it, an allowance can leave you with an asset. Let’s say you get an allowance, and use it to pay for a car over 3-5 years, after that, you now have an asset and pocket the allowance.
I have a $13K annual allowance.
The way I see it, an allowance can leave you with an asset. Let’s say you get an allowance, and use it to pay for a car over 3-5 years, after that, you now have an asset and pocket the allowance.
I have a $13K annual allowance.
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