Business car travel to increase among employees: Keys for Finance

While business travel rates should continue to increase in 2022, many employees aren’t comfortable with taking planes to destinations just yet. That means car travel will be popular this coming year.

In fact, 62% of business travelers said they’d be taking trips in their personal vehicles in 2022. This is according to the quarterly State of Travel and Hospitality report from Morning Consult.

Only 46% said they planned to fly.

An increase in car travel will likely lead to more mileage reimbursement than Finance has done in the past.

Plus, due to rising gas prices and other car-related costs increasing, IRS’ mileage rate is expected to be higher than it’s been over the last two years.

Here’s a suggestion that could help your company reimburse business car travel more accurately and save money in the wake of rising gas prices: Switch to another one of IRS’ methods for reimbursement.

Available options include using a fixed and variable rate allowance plan that accounts for various auto costs or a flat car allowance where employees substantiate their vehicle expenses and return any excess payments to you.

Rental car travel

Rental cars will also be popular with business travelers, whether they’re using them to drive to their destination or getting a car once they arrive.

Just as was the case in 2021, rental car shortages will impact the prices your people will have to pay. The supply chain issues that impacted car dealerships throughout the pandemic have also affected rental car companies. So the number of available cars is low, making the cost higher for car travel.

To save money and ensure your people have access to cars, it’s key to remind them to book early. This is especially true if the company didn’t book the car as part of a package deal with a flight.

Early bookings mean better prices – and a better chance of a car being available when the employee arrives.