Car Choice: The sporty option for keeping good company

Kwajo Mensah wants to replace his company car, a Peugeot 306, and wants to know what we think of the Volkswagen Golf 1.6 in petrol and diesel forms, and the BMW 320d

Kwajo Mensah wants to replace his company car, a Peugeot 306, and wants to know what we think of the Volkswagen Golf 1.6 in petrol and diesel forms, and the BMW 320d

What Kwajo has to establish first is what company cars is he allowed to select from. Many companies have all sorts of rules and regulations relating to model, specification and also the garage/lease company that supplies the car. Even before Kwajo gets down to the interesting business of selecting a car he has to be very aware that there are some serious tax implications.

Indeed, there are two main ways for Kwajo to keep his tax bill to the minimum and that means choosing a car which has a lower list price and/or one which is in the lower tax bracket. Company cars are taxed on their list price excluding road tax and registration fee. The tax brackets are based on the official CO2 emissions and their fuel type. Kwajo may know that all already, but it is important to highlight these rules especially as the emissions banding becomes lower each year and for 2004/5 is 10g/km lower and next year it will fall by a further 5g/km. Indeed Kwajo could even eliminate his company car tax bill by not having one. In exchange though Kwajo would get an allowance from his employer to help cover the costs of providing a car for business. Usually a monthly or annual amount in addition to his salary or as a mileage rate.

A CAR FOR THE HEAD

That would probably be the Volkswagen Golf then. Kwajo has the choice of seven different engines and that does not include the hot-hatch GTis.

Compared with the previous generation the new Golf is much better to drive and also has lots more inside. Rear passengers really notice the difference and you can easily get two full size adults or three children back there. The boot is bigger, although there is a substantial lip to heave things over.

The driving experience is very sharp though, and all engines are quiet and on most road surfaces it remains refined. The bottom line for Kwajo is that the 1.6 S produces 163 Co2 and is in the 18 per cent bracket. By comparison the 1.9Tdi S produces 143 Co2 and is in the 15 per cent bracket. What Kwajo also has to take into account is that the petrol 1.6 has a list price of £13,717 and the diesel £14,617. The specification of the S includes air conditioning and perhaps the alloy wheels and cruise control may not be worth it in tax terms. The 1.6 Fsi engine is excellent, economical and very refined. Where the 1.9 Turbodiesel scores is by being slightly more flexible with good acceleration from low speeds and in the overtaking areas.

A CAR FOR THE HEART

There is a new BMW 3 series in the showrooms and if Kwajo liked the old one then he should love the new one. The thing is though the model that he wants, the 320TD, may have a Co2 reading of 153 and be in the 17 per cent bracket but the retail price is far off £23,000. That factor alone is going to cost Kwajo fairly dear. If he wants a BMW, maybe the smaller 120d SE would be a better option, although it still costs £18,470. Closer in price to the Volkswagen would be the 118D at £16,970 which is in the 16 per cent bracket.

The styling though is not to everyone's taste and also everyone knows that it is the cheapest BMW. Perhaps then Kwajo should seriously consider the posh version of the VW Golf in the shape of the Audi A3. The figures are that it costs just over £17,000 and is in the 15 per cent tax bracket.

Whereas the smallest BMW does feel and look as though the company has cut corners the A3 looks and feels like a very quality piece of small hatchback kit. It is expensive, but worth it. If Kwajo enjoys driving then he will find the A3 to be a sporty little package.