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Slow progress for EVs among BVRLA's 2019 predictions

Date: 28 January 2019   |   Author: Sean Keywood

The rental and leasing organisation has picked out the key issues for fleets to look out for in 2019. Sean Keywood reports.

Fleet industry opinion is 'united' in predicting a long-term electric future - but there are still significant short-term challenges to overcome before the mass adoption of battery-powered vehicles can be achieved.

That's according to the British Vehicle Rental and Leasing Association (BVRLA), which has published its Industry Outlook Report for 2019.

The report states that while the big question around electric vehicle (EV) adoption is not if we get there, but how and when, supply shortages and long lead times seen in 2018 are expected to continue, meaning those looking to buy EVs will need to be patient.

It adds that the industry has 'grave reservations' about the cost and standardisation of charging infrastructure and how soon these can be scaled up to meet large-scale fleet demands, while there is also concern about government policy, with plug-in hybrid grants scrapped and reduced company car tax for EVs not due until 2020.

The report quotes Fleet Alliance managing director Martin Brown, who said: "As things stand now, I think it is more than ten years before EVs become dominant in fleet. Government policy is reactive and poorly thought-through - the end goal is electrification, but they have missed the bit in the middle."

Other topics discussed by the report include the used market. 

It highlights how uncertainty around Brexit and WLTP have led to a high level of contract extensions, meaning a shortage of ex-fleet stock for sale at the start of the year and concern about a spike in used volumes once renewals pick up. But it predicts that any changes in prices will be small.

Rising vehicle repair costs are also highlighted as a concern. Accident numbers are falling, but developments such as new materials, sensors and electric powertrains have an impact on repairability. 

The report states that even minor damage can lead to hugely intrusive and complicated repair procedures, with BVRLA members reporting more cases of cars being
written off.

Enterprise Rent-A-Car UK managing director Khaled Shahbo said: "You can't repair vehicles like you used to, so while there might be a reduction in accident volumes, the costs and timescales involved in repairing cars is growing. 

"We assume that the expense associated with parts and calibration will reduce over time, but we don't know when."

Elsewhere, the report says that data will become an increasing issue for policymakers, and that prognostics is set to become the new must-have fleet management service, with the prospect of using real-time and historic vehicle diagnostic data to improve vehicle safety, emissions and total cost of ownership.

On the subject of Brexit, it says members are focusing on preparing for unexpected outcomes, rather than just considering the various 'deal or no deal' scenarios.

Overall, the report says that while many of the issues facing the industry are the same as a year ago, there are significant changes in leasing and rental companies' approach, helping them to seize the initiative when taking on challenges.

BVRLA chief executive Gerry Keaney said, "The vehicle rental and leasing industry continues to see opportunities everywhere.

"It is perfectly placed to deliver the revolution in autonomous, connected and electric mobility and is already benefitting from growing demand for vehicle usership rather than ownership. Members are increasingly going direct, whether it is engaging with local transport policymakers, remarketing their own vehicles or talking directly with a new generation of personal and SME customers."

Keaney said that while BVRLA members may not be able to fulfil every mobility services need right now, they are keeping a very open mind about what is possible and how to spot new ways of adding value.

He added: "Whether it is electric vehicles, prognostics data, last mile logistics or car subscriptions, members are increasingly willing to explore new business models, technology platforms and partnerships."



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