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Fleets putting off EV adoption risk 2030 ban squeeze, conference hears

Date: 10 March 2023   |   Author: Sean Keywood

Fleet operators who are currently hesitant about electrification risk being pressured into mistakes at a later date, due to the need to meet the approaching deadline of the planned UK ban on new petrol and diesel car sales in 2030, it has been said.

Maria Bengtsson, partner and UK and Ireland electric vehicle lead for accountancy firm Ernst and Young, said that concerns over the financial outlay and complexities involved in electrification were holding some fleets back.

Speaking at a Westminster Energy, Environment and Transport Forum policy conference on the subject of the next steps for zero emission vehicles in the UK, she said that this would leave them needing to fit the switch into an increasingly short number of fleet cycles.

She said: "Fleet operators are a really important group due to the number of vehicles they operate on a daily basis, and I still see a lot of hesitation from clients. 

"There are a few different issues that keep coming up. The financial case is still unclear to a lot of companies, and the complexity of the transition makes it hard to navigate. 

"What this means is that the time these businesses have to actually transition their fleet is getting shorter. 

"If the ban in 2030 remains, it means you only have a low number of [fleet] cycles to cycle through all of your vehicles to EVs. And the shorter the timeframe, the more of a big decision you need to make, and the bigger the risk of inefficiencies and less than optimum solutions for your fleet."

Bengtsson also told the conference that charging remained the biggest issue for drivers considering EVs, and warned of charging infrastructure being rolled out unevenly.

She said: "Motorways and A-roads now are seeing quite a fast-paced build-out, and the reason for that is that there is a commercial business case for private capital to invest in those charging sites. 

"The further you are from those roads, and any area that attracts a lot of visitors such as shopping centres, the harder it is to create that business case, and as a result charging points are few and far between. 

"What I would like to see is a coordinated view of what the entire charging infrastructure needs to look like for the UK, and this needs to involve having a holistic view, understanding what driving behaviours look like, where charging is required, and what type of charging is required, because leaving it up to the market is going to get us a certain part of the way, but for everyone to have a reasonable chance of driving an EV it will need those areas to be focused on."

Also on the subject of charging, Mark Dickens, managing director of Renault group's Mobilize Power Solutions brand, told the conference that dedicated facilities for business drivers should be considered.

When asked what the government could do to help the EV charging situation, he said: "Business and consumer market segmentation. Coming to this venue today I was talking to the guy who was driving an EV Uber - he said his biggest problem is he can't charge, because he has got nowhere to go that is specifically for taxi drivers. 

"If we can sort out taxi infrastructure in the cities, but also a business dedicated hub, they could be large enough to take vans and the like and not affect the consumer's access to public charging in places like car parks."

A related topic was also addressed by Sarah Hassenpflug, sustainable innovation project manager for Oxford City Council.

She said: "There has been quite a lot of talk about vans and fleets, but when we talk about working drivers we mean something that goes a little bit wider than that. 

"It is people that are dependent on their vehicles for their economic activity, obvious ones like taxi drivers, but also there are home care workers, domestic cleaners, community nurses, delivery drivers, mobile hairdressers. 

"We have very little data about this group. It is really hard to find. We don't know where they live, we don't know exactly what they earn. 

"Oxford has done some really good work on taxis, and it's given us a baseline, but we're really keen to put this on the agenda and really start putting some resources towards finding out more about these people, because if we don't support them, they are going to become economically inactive potentially."

Although she discussed the potential impact of a 2030 new ICE car ban on fleets, Ernst and Young's Bengtsson also suggested that implementing this ban might not be straightforward, depending on the outcome of negotiations for similar legislation affecting the EU.

She said: "In Germany senior politicians have called for combustion engine vehicles to be exempt from the ban if they can run on so-called e-fuels or synthetic fuels. 

"Whilst EV penetration is growing, we are still talking small numbers in most countries from a demand perspective, and there is a financial case for OEMs to keep focusing on manufacturing ICE vehicles and existing plants. 

"There is a massive amount of capital involved in creating plants and technology and so there has to be a solid business case for making that move. 

"What does that mean for the UK? Well, if the EU postpones the ban, I think that it will be a tough task for the UK to persist with a 2030 ban. You might say Norway and a few other countries have been able to move ahead, but if OEMs fall back on some of their manufacturing targets, availability of EVs for the UK market will likely be impacted, and so putting a full ban in place will be difficult from a supply perspective."

However, another speaker at the conference, Caroline Low, director of transport decarbonisation for the Department for Transport, suggested that this outcome was unlikely.

She said: "I think what's happening in Europe is really interesting. I don't agree with Maria that it will derail what's going on here.

"If you follow how decisions get made in Europe it's a completely bizarre situation, and I guess shows the strength of feeling about this. But I'm really confident that the [UK's] ZEV mandate will be published very soon and that we will stick to those target dates."