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COVID-19 has dramatically reshaped our lives. While many changes have been for the worse (when can we hug again?), there have been a few silver linings. For one, the environment has begun to heal. As planes were grounded and executives parked their business vehicles, the skies started to clear.
No, seriously – air quality improved dramatically around the globe. In New Zealand, CO2 emissions plunged 80%. In China, NO2 (Nitrogen dioxide) fell by 65%. And in America, PM2.5 (or fine particulate matter) declined by up to 31%. The evidence was visually apparent, as deep blue skies replaced haze-filled skylines.
What happened? Stay-at-home orders drove these improvements as people left cars in garages. Unable to head into the office, these workers downloaded Zoom and got back to work.
Except for the odd hiccup, most firms handled the transition reasonably well. Some firms reported up to a 100% shift to remote working within 30 days. So this raises the question – after COVID, will we even NEED cars anymore?
It’s a complex issue, so let’s start exploring it below.
COVID Has Radically Reshaped How We Work
By Mid-March 2020, we couldn’t carry on with everyday life any longer. By then, COVID-19 was everywhere, as it had found its way to nearly every country on Earth. From the NBA to ordinary workplaces, the virus was sickening people everywhere.
So, within weeks, governments worldwide imposed sweeping lockdowns. In many places, heading into the office was no longer an option. If you weren’t an essential business, you were expected to stay home.
In other eras, this would have spelled doom for the economy. But thanks to available technologies, many companies were able to carry on as normally as possible.
Meetings were one of the biggest hurdles. But thanks to Zoom and its ability to handle dozens of connections at once, that concern faded away quickly. Security has turned about to be the biggest issue, as cybercriminals have exploited weaker cyber defenses at home.
Drawbacks aside, though, it appears our society-wide WFH experiment has been a success. Despite the isolation of working from home, 54% of Americans want to continue doing it post-pandemic.
But employees aren’t the only ones singing WFH’s praises – many companies are onside as well. Gartner, an IT management firm, reported that 80% of companies plan to offer part-time WFH, while 47% will allow employees to go remote full-time.
Corporations Have Saved Tons From Stops in Business Travel
The successes of working-from-home aren’t the only benefit that companies have enjoyed during the pandemic. Before COVID, many firms traveled across the country (and the world) to attend meetings, meet suppliers, and go to conferences.
But since all these activities are now impossible or impractical, companies have had to improvise solutions. Just as with day-to-day work, conferences and meetings have gone online with few issues.
For instance, SocialWest, a Calgary, Canada-based social media conference, transformed into Social at Home in 2020. Held three times in the past year, it has brought together digital marketing professionals from around the world, despite every attendee being in their home office. Featuring keynote speaker Seth Godin, the latest iteration attracted scores of rave reviews.
When you don’t have to leave your study to network with colleagues, why travel for business at all? That’s the question many CEOs are asking themselves right now. For some, the future is less about showing face and more about leveraging technology to save capital.
Don’t believe us? Then listen to Bill Gates – recently, he predicted business travel would drop by half post-COVID. Other studies mirror what the Microsoft founder is saying – a Fortune survey revealed 91% of CEOs expect business travel to decline. And in October 2020, management consulting firm Oliver Wyman reported 43% of frequent business travelers expect to travel less after the pandemic ends.
But one thing remains unclear – why would these companies give up the insights and relationships that business travel can yield? In a word – money. According to CNBC, Amazon saved nearly 1 billion USD in business travel expenses in 2020. At the same time, the e-commerce companies’ results have exploded. This past year, Amazon’s revenues shot up 38% while its market cap increased by 600 billion USD.
For many corporations, business travel is now a luxury, not a necessity.
Do You Need a Business Vehicle in 2021?
So, massive corporations plan on traveling less for work – but can you do the same? Like everything in life, it depends. There’s no way for freelance tradespeople to telecommute into work. So, for these professions (and others that REQUIRE physical presence), a business vehicle will remain a necessity.
But if you’re a white-collar worker/freelancer, there’s no real reason to own a business vehicle anymore. Think about it – what is the one thing that used to “require” a physical presence pre-COVID? Meetings, right?
Well, we’re one year deep into the pandemic, and most people are comfortable meeting over Zoom. Apart from that, everything you did at your desk is done from your spare bedroom now. But what if someone insists on a face-to-face meeting? Transit, rental cars, or a stroll to a co-working space (with dedicated meeting rooms) are all options.
So, is there a reason for owning a car moving forward? Well, there is one scenario we can think of – let’s assume the Coronavirus sticks around long-term. If you currently don’t have a car getting an inexpensive ride might be a worthwhile investment. This way, you can avoid potential exposure events on transit.
Vehicle Finance is a Big Expense for Many Businesses
So, driving around to meet clients is no longer a necessity. This development has many CFOs rubbing their hands with glee, as vehicle finance is a significant expense for many businesses. In Australia, for instance, vehicle business finance specialist firms regularly approve loans as large as $750,000.
Throughout the loan term, borrowers can end up paying tens (or hundreds) of thousands of dollars in interest charges. But with COVID-driven changes in business travel, they no longer have to take on liabilities like these. Free of these expenses, businesses can now drive growth by reinvesting this cash into higher-yield areas of their operations.
Unless You Absolutely Need One, Business Vehicles are Money Pits
The second a vehicle rolls off the dealership lot; it IMMEDIATELY loses 9% of its value. What’s more, vehicle finance charges can cost you untold thousands of dollars over the life of a loan. That’s how bad of investment they are.
If you can avoid using a business vehicle, we advise doing so. Thankfully, in a post-COVID world, technology and the mindset surrounding travel have made this goal a realistic one.
Have you ever worked for a company that provided a business vehicle?
Krystle Cook – the creator of Home Jobs by MOM – put her psychology degree on a shelf and dived into a pile of diapers and dishes instead. She is a wife and mother to two rambunctious boys, sweating it out in her Texas hometown. She loves cooking, DIY home projects, and family fun activities.