Fleets Are Going Electric… Quietly

If you are a Fleet Manager or someone who is involved with either running or financing a company fleet, then a big part of your job will be making sure that costs are kept under control…that the vehicles do exactly what your drivers and company want them to do in terms of providing a service and being cost-effective…that they are as economical and reliable as possible…and that you and your business are getting value for money over the vehicles lease or hire term.

Image can also be a major factor. You’ve probably got an eye on sustainability and corporate responsibility. Business drivers will also want a car that is economical to run and be as tax efficient as possible.

And don’t forget, although it might seem like a long time in the future, January 1st 2030 will see the sale of new petrol and diesel cars banned in the UK. Okay, hybrid cars get a stay of execution until 2035, but you need to get used to the fact that just over seven years from now, your fleet will be largely electric powered with the regular charging of batteries being factored into daily life.

Fleet Electric blog post red Skoda

Is your business ready to switch to an electric fleet?

Some of you may have the sort and size of fleet which is ready to make the switch.

This will probably come down to range and where your vehicles operate. Bearing in mind that the launch of every generation of electric cars sees the ranges getting longer and the time required to charge batteries getting shorter. The future is bright for electric cars.

If you operate a fleet which is mainly city based or doesn’t rack-up a high daily mileage, then electric power could be for you. Remember, even if you do dozens of stop - start, short journeys, the range of an electric car will be hardly affected. It can be a major drawback for petrol and diesel cars because the engine is continually having to go through the gears, but an electric car doesn’t have gears (apart from reverse and forward obviously) and has 100 per cent power instantly. When you come to a halt or are crawling in busy town traffic, a conventional car will either have the engine ticking-over constantly or will use a stop-start facility. Electric cars use only a tiny amount of power when they are at a standstill, and as long as you’re not continually trying to beat other traffic away from the lights and drive the car sympathetically, the flow of electricity from the battery will be more or less constant at town speeds.

The problem for electric cars is range. Any electric car driver will have at some time suffered from range anxiety….the ever-decreasing range matched by the distance to a charging point. Oh…and will the charger be working and / or available when you get there.

Fleet Electric blog post white Skoda charging

The next problem is that, assuming you can find a rapid charger, you are probably looking at an hour or so to provide any sort of meaningful boost to the battery.

Consequently, the best way to use an electric car is to have a charger available at either end of your journey. For a delivery fleet this may be a number of chargers at base where the cars or vans can be charged overnight and be ready for the driver the next day.

The other option, particularly for business car users, is to have a charger at home. Plug it in following a day at work and you’ll be ready to go after breakfast.

Financial benefits of going all-electric…

There are financial benefits of going all-electric too. You don’t pay any road fund tax. You don’t pay congestion charges. Business drivers who have a fully electric car also attract only 2 per cent Benefit-in-Kind (BIK). This figure is fixed for the next three years.

If you were lucky to have something like the Volkswagen ID.3 Pro Performance 204PS car in Life trim and you lie in the 20 per cent tax band, your P11D will be in the region of £36,000*. Your monthly tax liability works out at around £12*.

Compare this to something like a similarly priced (around £32,000) P11D Volkswagen Tiguan Life 2.0 TDI 150PS diesel powered car which attracts a BIK tax of 36 per cent, you will be paying around £195 per month*.

Fleet Electric blog post red Skoda charging

Fleet managers have a similar incentive as they’re also offered a lower tax bill in relation to the CO2 emissions of their fleet. There are also benefits if you choose to buy electric vehicles for your fleet rather than lease them. Electric cars are eligible for 100% first year capital allowances. This means you can deduct the full cost from your pre-tax profits. On a car costing around £40,000 this could amount to a tax relief of £7,600 in the first year.

There are also benefits for companies who provide charging points at their premises.

Savings when switching to an electric car as a business driver

As a guide, EDF energy has recently done some research which, they say, shows that the average company car driver, travelling 18,400 miles a year could save over £1,000 each year by switching to an electric car. It’s also worth mentioning that maintenance costs will be lower when comparing electric vehicles to conventional petrol or diesel cars and vans for the simple reason that electric cars have fewer moving parts and therefore less to wear out.

And then, the big one. How much does it cost to travel for, say, 100 miles in an electric car when compared to a petrol powered car? At the moment, it’s a bit tricky due to the volatile nature of fuel and electricity prices, but a rough guide is that 100 miles in an electric car will cost you around £6.50 (20p per kWh). In comparison, the Tiguan we mentioned above will cost you around £15 (54.4mpg @ £7.50 per gallon)

Fleet Electric blog post white and red car

In other words, you need to do your sums….and keep doing them. As we mentioned at the start, when it comes to electric cars, the distance you can travel is getting longer and charging times are getting shorter. Purchase prices are falling as more and more electric cars and vans join the marketplace.

So, in terms of electric cars, what’s available at Pulman for your business?

Well, for more information on how going electric can be a massive boost to your fleet, head to our Fleet page using the button below and you can discover all your options.

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