The UK Ministry of Defence (MoD) has contracted Babcock to manage its fleet of lease and hire vehicles in a bid to save £100m.
Valued at £47m, the contract requires the company to manage the MoD's 'white fleet' of cars, vans, trucks and specialist vehicles covering the UK and Northern Europe.
The MoD uses hire or lease vehicles to transport personnel and equipment around the country, often to areas not accessible by public transport.
The vehicles are used for various tasks, including moving defence personnel, supporting military operations and training exercises, and providing emergency support to civil authorities and communities.
UK Defence Secretary Michael Fallon said: "Defence has the strongest incentive to be efficient. Every pound that we save on vehicle hire will be reinvested into a defence budget that keeps Britain safe.
"I want to see us meet and exceed the £100m target."
The contract covers procurement of vehicles via the Crown Commercial Services, incident management, administrative services, and maintenance and repair management.
It also allows increased use of scheduled transport services and vehicle sharing.
The army, the MoD's largest user of fleet vehicles, is already using a car pooling hub at Aldershot.
Army equipment head Brigadier Colin McClean said: "The use of lease and hire vehicles is an important part of Defence's overall ability to both train for and deliver its operational tasks and I know I speak for soldiers, sailors and airmen when I say that we look forward to working very closely with Babcock and in particular to achieving financial savings through the more efficient use of this vehicle fleet."