Due to the upcoming ban on the sale of new petrol and diesel cars in 2030, businesses are beginning to consider greener alternatives for their fleets. Most manufacturers are focusing on electric vehicles and there have been significant developments made to the technology and infrastructure over the last few years, making them a more accessible option for businesses.
However, there are still challenges with EV technology, particularly for businesses with large fleets that consist of HGVs. This raises questions about whether drivers in the UK are ready to make the switch to electric and if not, then what are the alternatives?
Are businesses ready to move to EV fleets?
In a recent survey, Right Fuel Card questioned a range of different businesses across their SME customer base to find out if EV technology is a viable option for commercial vehicles. Most businesses were certain that they would not be looking to switch to EVs in the next 12 months, including 97% of respondents in the haulage and transport industry. Cost was the main prohibiting factor for businesses however, there are also various other barriers that are restricting the practicality of electric vehicles. This result is reflective of the views of the wider public with 52% of non-EV drivers intending to use petrol and diesel vehicles for as long as possible, according to a survey by Lloyds Bank. The main concerns that businesses have about using electric vehicles for their fleets are:
- Cost – The purchase cost of electric vehicles is generally more expensive than a traditional ICE vehicle and many businesses do not have the funds to invest in these vehicles.
- Driving range – Fleets that travel long distances on a daily basis are wary of the limited driving range of electric vehicles as they may not be capable enough to handle these trips.
- Charging infrastructure – Although new charging points are regularly being introduced, there are still concerns about having access to a charger when needed, particularly when travelling in rural locations.
However, some businesses, such as DPD, have been able to introduce all-electric fleets and are now reaping the benefits of having greener vehicles. As a wider selection of EV vehicles becomes available, it’s expected that more businesses will be able to make the switch, especially once the purchase cost starts to decline. Electric HGVs are also becoming more accessible which provides the opportunity for businesses to reduce their carbon emissions across their whole fleet. Carlsberg Marston’s Brewing Company (CMBC) and Amazon have both recently unveiled electric HGVs, setting the precedent for other larger companies to follow suit. As HGVs make up around 16% of the UK’s domestic transport emissions, it’s important that more electric models are developed. This would allow them to be accessed by smaller businesses that don’t have the ability to invest in their own models.
The core requirements for a commercial vehicle
Commercial vehicles are used by a wide variety of industries across the UK which all have individual requirements depending on their line of work. However, there are some core requirements that a commercial vehicle needs, which some would argue EV technology is not yet able to fulfil. The main requirements are:
- Cost-effective – So that businesses can continue to make a profit, it’s essential that the vehicles in their fleet are cost-effective. Not only are electric vehicles costly to purchase but the cost of charging has also increased, making them almost as expensive to run as petrol cars. Although EVs will benefit the environment, most businesses are more interested in keeping their costs down and currently they’re just too expensive to be used as commercial vehicles. However, it is important to note that electric vehicles are cheaper to maintain and will save businesses money if they need to enter clean air zones.
- Safety – There have been concerns about the safety of EVs, as businesses want to ensure that their commercial vehicles will be safe on the roads. However, the idea that electric vehicles are unsafe is a myth. They can be driven and recharged even in the rain and it’s highly unlikely that drivers will get a shock from a charging point. The battery in an electric vehicle also goes through rigorous checks to ensure that it won’t overheat or explode. This means that electric vehicles are perfectly safe to drive, and in some cases are even safer than petrol and diesel vehicles, providing peace of mind for businesses.
- Equipment – Some businesses require their vehicles to transport heavy loads and so it’s essential that they have the capabilities to do so. Contrary to popular opinion, some EVs can tow trailers and other heavy loads and there’s an increasing number of models coming to the market that are designed with this requirement in mind. However, businesses will need to consider the fact that heavy loads will reduce the driving range of electric vehicles, so they won’t be able to travel as far as their petrol and diesel counterparts.
- Accessibility - Commercial vehicles need to be readily available so that they can be used when necessary, however, the accessibility of electric vehicles is limited as they regularly need to be recharged. This would be impractical for businesses that need to travel on the clock, such as couriers and taxi firms, as they don’t have the time to wait for their EVs to recharge.
The current progress of EV infrastructure development
Although the UK currently has over 30,000 public electric charging points, the infrastructure is imperfect and many drivers still experience “range anxiety” which is preventing businesses from adopting electric vehicles. Even though more charging points are being introduced, there’s no guarantee that they’ll be working correctly or that they’ll be available to use. This can cause issues for drivers that are running low on charge, especially if there are no other chargers nearby. Furthermore, this can delay delivery times as drivers may have to detour significantly to find a suitable charging point.
Public EV charging points are primarily located in towns and cities, so there are limited options available to those who live or travel to more rural areas. A recent study by Which? found that almost half of the drivers who responded are deterred from electric vehicles due to the lack of public chargers. This echoes the feelings of businesses surveyed by Right Fuel Card who had concerns about the accessibility of the EV infrastructure. Businesses must also consider the cost implications of electric vehicles as they can be more expensive per trip than a petrol or diesel vehicle and will take significantly longer.
To overcome these challenges, the EV infrastructure needs to be expanded further into rural locations, and maintenance issues will need to be closely monitored to minimise the number of chargers that are out of order. In addition, more financial assistance is required to help drivers invest in home chargers, if practically they’re able to, so that they’re not as reliant on public chargers. However, this is not possible for many drivers who do not have access to off-road parking.
UK Government's effort towards a greener future
The UK Government has pledged that all new cars will be emission-free by 2030 and have spent over £2.5 billion, so far, on the EV infrastructure and the provision of vehicle grants. This has helped the automotive industry move towards a greener future as manufacturers are being encouraged to develop new electric models that will benefit the environment.
Despite the initial efforts from the Government, many believe that they’re no longer offering the support needed for businesses to invest in EV technology. Grants that aimed to encourage drivers to switch to electric vehicles have been cut over recent years, including the plug-in car grant scheme which was introduced to make these vehicles more affordable. The Government is now focusing its funding on expanding the public charging network, which although will be beneficial in the long run, does not help businesses that are struggling to afford electric vehicles in the first place.
Nevertheless, there are still grants available that will make it easier for businesses to switch to all-electric fleets, including:
- Workplace Charging Scheme (WCS) – This grant covers up to 75% of the total costs of the purchase and installation of EV charge points (inclusive of VAT), capped at a maximum of £350 for 40 sockets across all sites.
- EV chargepoint grant – Provides funding for 75% of the costs of buying and installing EV charge points in a UK domestic property, up to a maximum of £350, including VAT.
- On-street Residential Chargepoint Scheme – The Government is investing £20 million of funding towards this scheme which aims to increase the availability of on-street charge points in residential streets where off-street parking is not available.
Electric vehicles will undeniably have a significant role in the future of the automotive industry as they can be utilised by businesses to reduce their carbon emissions and have several cost advantages. Although some businesses have already made the switch to electric and found the transition to be relatively smooth, there are still challenges that need to be overcome before this technology can be adopted on a wider scale.
The key issues that need to be tackled are the accessibility of EV charge points and the selection of vehicle models which is currently too limited, especially within the HGV market. Fleets that use HGVs are arguably more likely to consider using hydrogen technology in the future, as the vehicles can be charged faster than EVs and the driving range is significantly longer.
Find out more about hydrogen fuel.
To help make EV technology more appealing to businesses, we have introduced EV charge cards to our network. Apply for the BP Fuel and Charge card and the Shell Fuel and EV card online today.
For fleets that are not ready to make the switch to electric, we offer a selection of fuel cards that can help save your business time and money. Use our comparison tool to discover which card we’d recommend for you or contact our team at 0113 202 5110 to find out more about how Right Fuel Card can help your business.
 | Matt DoddsWith over 14 years of experience across two of the leading fuel card companies in the UK, Matt Dodds joined RFC Edenred to help lead the development of products to support our customer's move to EV and other alternative fuels, a transition he feels passionately about. |
