As a recruiter, I constantly see candidates having to choose between two opportunities. Sometimes, one of those may include a company vehicle.


For instance, if you have a job that pays $40,000 with a company vehicle is that better than $50,000 without a vehicle? (Hint: Nope!)

Let’s look at the numbers. According to the U.S. Department of Transportation, the average 20-34 year old drives 15,098 miles per year. That is probably higher for rural jobs, but i’ll use it for simplicity sake.

One simple way to look at this is to use the U.S. standard mileage rate of $0.54/mile. The IRS figures that to be the realistic cost of operating an automobile.

So, a company vehicle should be worth about (15,098 miles x $0.54/mile) = $8,152.92 per year. To be safe, I round up to $8,500.

There are more complicated methods, but you’re going to get very close to the same answer. For example, let’s say you buy a big truck and pay $500/month in payments. With a rig that size, you get 18 miles per gallon. Your cost will look like the following:

($500 x 12) + (15,098/18 * $2) = $7,677.56 + insurance/repair/maintenance

A good rule of thumb is to value a company vehicle at $8,500/year. This assumes that you do not have to pay for any fuel, insurance, repair, maintenance, etc. For every one of those items you are responsible for, you should deduct from that number.

This number only holds true if you are allowed to also use that vehicle for personal use. Make sure you clarify this before making your decision. If the vehicle is only to be used for driving to/from work or during work business hours, then you will need your own personal vehicle anyway. This changes the equation drastically. 

In that scenario, I would just use your expected commuting miles multiplied by that standard mileage rate. The total figure will be much lower than $8,500/year. 


This tells you that if a company wants to include a company vehicle into your compensation package, that’s the same as an equivalent job that pays you $8,500 more per year without a vehicle. This assumes the company allows you to use it personally and they cover fuel, insurance, maintenance, and repair.

Blog by Tim Hammerich