Mobility budget as a company car alternative: SAP follows the trend

January 16, 2023

For a long time a company car is a coveted salary component for many employees. In Germany alone, there are around five million company cars on the road!

But there are good reasons why companies can reduce the number of company cars on offer or even do without them and use a mobility budget as a valid alternative. 

SAP is the first major German company to take this step. From April 1, 2023, the software company will introduce a comprehensive mobility budget for its employees as an alternative to a company car. From this date, all eligible SAP employees will be able to use the mobility budget in Germany.

They will be able to use buses and trains, bicycles, rental cars, taxis,  scooters, and other mobility options.

This decision is remarkable in that the software group has the largest fleet of company cars in Germany, with around 17,000 vehicles. Understandably this decision has made the headlines of every major German newspaper and media. SAP wants to break new ground with the latest mobility budget as part of the job benefit and aims to attract younger talent who are not interested getting a company car. The time that

The company uses an internal solution for the mobility budget and has put together its own offering. With the use of an app solution, users can see which bicycles, cars or other means of transport are available. Employees initially pay themselves, submit their expenses and are reimbursed within their one-year budget.

How RYDES sees the Mobility of the solution of SAP:

We encourage every company to apply and experience the mobility budget in order to make employees more flexible and reduce overall CO2 emissions by encouraging the use of green mobility.

But we would like to offer an additional take on the method that SAP is using and our suggestion could benefit not only encourage the usage of the mobility budget but also increase the enjoyment of using mobility budget and accelerate the adoption.

The method that SAP is using, 'Paying in advance and getting the money back later,' after the trip has already ended', sounds complicated and it leaves a lot to be desired from a user experience point of view. Especially when it concerns, for example, regular bike or scooter trips with single-digit usage amounts. The inconvenience it brings from an admin point of view: adding pressure both on the user and administrator will pay a crucial part in the whole experience of transitioning smoothly from company car to mobility budget.

Our take: The mobility budget solution with a card solution instead of a reimbursement solution is simpler and more convenient for employees and employers.

It uses a monthly topped up credit card that employees can use to book and pay for their mobility digitally and without cash. All costs are tracked automatically and there are no reimbursement head aches for the administrator and accounting departments.

We'll show you how thjs method works and describe how our a credit card solution is a better alternative than  a invoice reimbursement solution that SAP uses.

Mobility budget as a card solution for company mobility.

With the mobility budget card, your employees can make flexible cashless payments for their private or business mobility at any time and anywhere in the world. The possibilities and flexibility are unlimited.

The mobility credit provided can be used for all mobility services available on the market.

The mobility budget card is simply deposited in the mobility provider's app like a debit card and used to book and pay for the mobility service.

Here are a few examples of the mobility services your employees can choose from:

  • Public transport tickets. The most common use of the mobility budget is to buy tickets for public transportation. Access tickets from all public transport companies and the railroads in Germany and worldwide and buy one-way tickets, short-haul tickets, and weekly or monthly passes.

    You can also take out monthly or annual subscriptions.
  • Micro mobility Services. Take advantage of available micro mobility providers, including e-scooter sharing, e-moped sharing, and bike sharing.
  • Car sharing services. Rent a car from WeShare, Miles, SHARE NOW, Sixt, and many more.
  • Ride-hailing services. Simply call a cab or use the services of Uber, FREE NOW, and others.

In addition to the mobility budget card, a holistic, all-encompassing mobility budget solution offers the following services:

  • Fuel and recharge card. Give your employees access to thousands of gas stations and charging stations. No receipts, no paperwork, your employees pay directly with the card solution. 
  • Bicycle leasing services. Employees can put together the bicycle of their choice and conclude a bicycle leasing contract. The monthly payment van be paid through the mobility budget. 
  • Ticket refunds. Of course, the integrated mobility solution also includes the option of having public transport tickets scanned and reimbursed. There will be occasions when your employees have to pay for a public transport ticket should they travel to another city or just have to pay for a single trip. 

As you can see, the Mobility Budget Card gives your employees maximum flexibility. One card provides access to all means of transportation anywhere in the world. Using digital mobility solutions where a virtual credit card is used, your employees decide how best to get to work, sustainably.

A simplified onboarding process reduces administrative time, and a dashboard-based employee management system helps you keep an eye on costs. This means that you do not have to chase everyone for uploading their receipts anymore. This means an improvement on efficiency and an increase in the productivity of your HR team. 

Another advantage: The CO2 emissions of all journeys made via the mobility budget are automatically compensated via certified climate protection projects. It contributes to making your company's mobility 100% climate-neutral and fulfilling your CSR reporting requirements for 2024. 

What advantages does the mobility budget offer employers and employees?

A mobility budget offers a number of benefits for both employees and employers.

For employees, a mobility budget means that they can adapt their choice of transport to their needs.

They have the flexibility to decide for themselves whether they need public transportation, driving services, or other forms of mobility. This flexibility can be particularly beneficial for employees who travel frequently for work.

For employers, a mobility budget can help save costs on employee mobility and provide employees with additional financial security. In addition, a mobility budget can help reduce the company's CO2 emissions by encouraging employees to use alternative and environmentally friendly means of transportation instead of a company vehicle.

For these reasons, a mobility budget can be attractive to employers and employees alike.

Young employees in particular increasingly no longer want to own a company car. Instead, they want to be able to switch flexibly between modes of transport.

Taking the S-Bahn or a company bike to work, taking a cab home from the regulars' table with colleagues in the evening, and using a car-sharing car on the way to the office to go to daycare or shopping after work - all without having to own a car.

For many employees, the company car sits around too often unused, and even more so with more frequent work in the home office. This has also increased the rethinking in many companies.

The mobility budget is a flexible alternative to the company car because it offers the following advantages:

  • The modern salary extra makes the company more attractive as an employer for top talent.
  • The company becomes more sustainable and improves its carbon footprint, which in turn makes the company more attractive to many young professionals.
  • In addition to CO2 emissions, the company also saves costs, for example for company parking spaces and the procurement of expensive company cars.
  • The mobility budget as a non-cash benefit also allows tax savings. Up to 50 euros per month are tax-free. Amounts above this are only taxed at 30%.
  • The sick days of employees decrease when they ride their bikes instead of driving.

Conclusion: The future of corporate mobility belongs to the mobility budget.