Businesses need to take immediate action to reduce the costs of mobilising their workforce, with new tax rules being introduced on April 1 that will hit newly registered models with CO2 emissions above 160 g/lm.

Many firms are already going the extra mile to stop the squeeze on fleet costs, but need to pass on the impact to employees through changes to car schemes.

With employee power on the wane as the recession bites, many contract hire customers have already decided to run their company vehicles for longer to reduce monthly payments by up to 10%, despite past concerns over employee dissatisfaction.

April 1 changes to the corporation tax regime provide the ‘perfect platform’ for firms to re-evaluate their employee benefit schemes, including company cars. Employers can make significant tax savings by ‘greening’ their fleets.

Demand for used car stock in the open trade market has led to some of the strongest price rises in the history of CAP ‘Black Book’ - but the resurgence is far from guaranteed to continue.

Despite gathering recession and the slump in new car orders, used car dealers are reporting strong retail demand and paying anything up to £500 more for a three-year-old standard volume vehicle than at the start of the year.

According to the March edition of ‘Black Book’ late plate cars are especially strong, due in part to weakness in the new car sector leading to dramatically reduced supply.

A notable feature of the current market is increased competition for stock from franchised dealers who would normally rely heavily on the influx of part-exchange cars from new vehicle sales, along with nearly new cars generated by the pursuit of new car volume bonuses.

All the market performance indicators measured by ‘Black Book’ moving into March showed unusually strong results, with ex-fleet car conversion rates in particular enjoying a historic high at around 90% - compared with under 75% for the same period a year ago.

One of the most remarkable features of the current market is the relative performance of used car sectors, according to CAP. For example, for the third month running, 4x4s are leading the charge toward higher values while even the usually oversupplied small executive car sector records an average rise of almost 6% for March.

Companies will face significant increases in their corporation tax bills from April 1 if they fail to reflect changes in business car capital allowances in company car choice lists.

The key figure under the new capital allowances and the rental disallowance (currently called expensive car disallowance) tax rules is 160 g/km of CO₂.

Essentially, the complex new rules will potentially make it more expensive for companies to run vehicles over 160 g/km irrespective of whether they lease or buy. Current projections indicate that the post tax net effect could see ‘effective’ costs for a company car increase by as much as £30 per month or more on vehicles emitting over 160 g/km.

Safety-focused businesses should ban employees from using all mobile phones while driving after a company director was believed to have become the first person in Britain to be convicted of careless driving over the use of a hands-free mobile phone. The landmark court case has a significant impact for all businesses, as well as public sector fleets.

Although, only the use of a hand-held mobile phone while driving is against the law, best practice advice says that using a hands-free mobile phone is equally dangerous. Department for Transport research reveals that using a mobile behind the wheel makes drivers four times more likely to have a crash.

Lynne-Marie Howden (43), a director and head of sales at business consultancy company Insights, was found not guilty of causing death by dangerous driving after crashing into another car on the A429 in Warwickshire in November 2007. However, she was convicted on the lesser charge of careless driving and was banned from driving for 12 months and fined £2,000.

Warwick Crown Court had been told that the businesswoman, from Northamptonshire, had been involved in conversations on her hands-free mobile phone with her boyfriend and then a work colleague when, driving her Mercedes CLK 220 at around 40 mph in a 60 mph speed limit, she ploughed into an oncoming car on the opposte side of the road. The driver died at the scene of the crash.

Within days, Labour peer Lord Ahmed (51) who sent and received text messages minutes before he was involved in a fatal crash on the M1 was jailed for 12 weeks. He was driving his Jaguar when he hit a stationary car in the outside lane of the motorway on Christmas Day 2007 - Martyn Gombar (28), of Greater Manchester, was killed. Lord Ahmed, of Rotherham, had admitted driving dangerously and was also banned from driving for a year and ordered to pay £500 prosecution costs. However, he is appealing against the sentence.

Using a hand-held mobile phone while driving was made illegal in December 2003. Two years ago, in February 2007, the Government toughened the punishment for offenders to three penalty points and increased the fine from £30 to £60.