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Clearing the air

Date: 07 February 2018   |   Author: Rachel Boagey

As diesel finds itself thrust into the spotlight of a global urban environment crisis, there is another side to the negative news. Many firms are biting the bullet and coming forward to stick up for the need for the fuel in the industry. 

In fact, leasing company Arval is one of the companies that has said that diesel, in the short term at least, remains essential to the transition towards a more environmentally friendly energy mix.  

With diesel currently accounting for two thirds of car and light commercial vehicle registrations for fleets across Europe, the company has published a white paper titled 'Clearing the air around diesel', in which it clarifies the current status for diesel in Europe and provides fleets with guidance around diesel to help them formulate future policies.

Arval is convinced that, in the short term, diesel remains instrumental in the reduction of CO2 emissions, giving time for manufacturers to make the necessary investment for the production of affordable  alternative   vehicles, and for public authorities to develop the required infrastructure. 

"It was important for us to make an inventory of energy use, while the world is experiencing an unprecedented transition in this area," explains Philippe Bismut, CEO of Arval. "This approach is beneficial not just in supporting our clients towards even more appropriate solutions, but also in bringing a more global reflection on the mobility of tomorrow."

According to Arval petrol and more  pertinently hybrids, also have an important role to play as we wait for greater availability of full electric vehicles (EVs) and the supporting infrastructure. In the meantime, Arval's experts take the view that, in the right circumstances, full EVs can provide a good option.

Shaun Sadlier, the company's head of consultancy, explains, "During the second half of last year, diesel became perhaps the most discussed topic with our fleet clients.

"Our view, at that point in time, was that a lot of what was being said and being reported was spurious, and that the correct thing to do was to wait and formulate a position that we believed was correct and sustainable."

Despite this positive message surrounding diesel, Arval expects the percentage of diesel vehicles on its UK fleet to fall from 90% today to 78% in 2020.

Sadlier says that, in the short term, Arval expected a moderate rebalancing of diesel and petrol on its fleet, as the pump prices of diesel became progressively less attractive and manufacturers invested less in diesel technology for smaller vehicle segments.

"These factors favour petrol cars over their diesel counterparts, but we expect there to also be a gradual increase in the volume of hybrids as awareness around true  CO2 and NOX grows," says Sadlier. 

"Hybrid technology has been available for around 20 years, is well proven and, as it progresses with the widespread availability of 48V [battery] solutions, we expect it to form a larger part of our fleet."

Elsewhere, Sadlier says that full EV solutions will remain niche products as long as there are question marks over their range capabilities, and also while there is a need for further development of recharging networks. "But clearly, these vehicles will also have an increasing part to play," he says.

Sadlier adds that diesel had actually been in decline on Arval's fleet across Europe for some time, well before the current predictions about the 'death of diesel'.

"Diesel hit a peak of 56% in 2011 across our 15 EU countries, falling to 50% in 2016, and we do see what is happening at the moment as very much the continuation of a longer-term trend."

Sadlier believes that "fleets of the future" will use a mix of all available fuels, and that diesel will continue to be a viable and important element. The white paper outlines that Arval's consulting teams can accompany its clients in their fleet profiling exercise, and help them to build or rebuild their car and mobility policies to tackle these new challenges.

"Arguably, the difficult part will be making the right fuel choices for the right applications, and we see helping fleets make these decisions as a key part of our consultancy offering moving forward," he says.