Each business is on its own journey to an electric fleet, some are already there, some are in the early stages and others have yet to begin. If we look at the latest Electric Vehicle (EV) registration figures from the Society of Motor Manufacturers & Trading, we can see EV registrations for fleet vehicles is up by 14.2% and business cars by 22% in comparison to last year, so the transition is underway.
Where are you on your journey? Are you thinking about upgrading your fleet? If you’re unsure, why not read more about what it involves in our blog – Are Increasing Costs Causing You to Postpone a Fleet Upgrade?
We know there are challenges when it comes to managing a car fleet, we’ve got some helpful hints and tips in our blog – The Challenges of a Fleet Department.
In this blog, we’ll explore the benefits and considerations when choosing between an EV fleet and an Internal Combustion Engine (ICE) fleet – petrol and diesel cars.
Benefits of an EV Fleet
There are a number of benefits for your business if you run an electric fleet, for example, there’s the potentially to make savings on fuel costs. According to the Allstar Winter 2023 All Costs report, the average price of petrol and diesel has gone up over the last 12 months. Although the cost of electricity varies dramatically from car to car, depends on location and energy supplier and differs from public charging to home charging, if the electric efficiencies are utilised effectively, it’s possible to make savings.
By having an electric fleet, you can create a positive brand image and demonstrate corporate social responsibility by showcasing your commitment to sustainability. With the UK Government’s strategy for reaching net zero greenhouse gas (GHG) emissions by 2050 well underway, environmental impact is now a consideration for most businesses. As transport is the largest emitting sector of GHG emissions, producing 26% of the UK’s total emissions in 2021 according to the Transport and Environment Statistics, looking at your car fleet can be a step towards going green. With Electric Vehicles having lower CO₂ emissions, you can build the sustainability of your business.
There’s potential tax benefits and financial incentives available for businesses transitioning to electric fleets too. Fully Electric Vehicles which produce zero CO2 emissions come with a Benefit-in-Kind tax rate of 2% currently, and the Government has advised this won’t increase beyond 5% until at least 2028, which can make savings for your employees. And depending on how you deliver the car benefit to your entitled drivers, there’s potential for the business to make savings too.
Charging incentives are also in place. Under its Electric Vehicle Homecharge Scheme, grants are available from the Office for Zero Emission Vehicles (OZEV). If you have a small to medium business and fit the eligibility criteria, grants are available for installing multiple EV chargepoint sockets. The grant covers 75% of the cost of the work, up to a maximum of £15,000 and you can get up to five grants, but they must be across five different sites.
Improving employee satisfaction with a modern and eco-friendly car can also be a great benefit, as it can make your employees feel valued, rewarded and motivated, especially if it’s a make or model they wouldn’t own personally without the help of the car benefit.
Challenges of an EV Fleet
Range and charging anxiety are still considered as potential challenges for EV drivers. Long distance journeys have to be planned out for fully electric vehicles or plug-in hybrids if these drivers want to utilise the benefit of the electric range.
Costs to install electric chargers are another concern, whether at home or at business premises, with the average cost of a home charger installation being between £600 – £1,000, which should cover the EV charger itself and the labour costs. For businesses, the Energy Saving Trust reports the cost at anything from £1,500 up to £35,000, with the speed of charging being a significant factor in the price variation.
According to ZapMap: ‘At the end of June 2024, there were 64,775 electric vehicle charging points across the UK, across 33,829 charging locations. This represents a year-on-year increase of 46% in the number of public devices, with 20,367 installed since June 2023.’ While this sounds like a lot, it’s still nowhere close to the number of petrol stations exist across the country, and the electric chargepoints also aren’t equally distributed. The most EV charging points are in Greater London with 20,679, followed by the South East with 8,016 and Scotland with 5,663.
Solutions for EV Fleet Challenges
There are strategies you can consider to optimise EV fleet challenges, such as:
Implement smart charging practices
Optimise charging schedules to minimise range anxiety and consider sharing or renting out your chargepoints, this could act as an extra source of income to help offset the cost of installing the EV chargers.
Route planning
Make sure your drivers plan their trips, especially if it’s long distance, encourage them to be strategic when looking for public chargepoints.
Considerations for ICE Fleets
Despite EV fleets offering significant advantages, traditional petrol and diesel fleets can still work best for certain businesses.
There’s an established infrastructure of fuel stations across the country, meaning fuel is readily available, which minimises concerns about range anxiety for long-distance journeys.
Technicians are generally more familiar with maintaining ICE vehicles, which could lead to faster turnaround times for repairs and potentially lower maintenance costs compared to newer EV technology.
Driver preference, driving style, what the car is primarily used for, business use or commuting can also all influence which fuel type is most appropriate.
Which Fleet is Right for Your Business?
When it comes to making the right decision for your business, here’s a reminder of the key benefits of an electric fleet:
– Reduced reliance on fossil fuels and lower overall fuel costs.
– Improved sustainability and positive environmental impact.
– Potential tax savings and financial incentives associated with EV ownership.
– Enhanced employee satisfaction with a modern and eco-friendly fleet.
The transition to an electric fleet will be different for every company, and it may not be right for your business to go full electric today, but there’s multiple options for electrifying your fleet.
If you’re looking for help to manage your transition to an electric fleet solution, get in touch with us today.