19 April 2021
If your company is planning to convert your fleet to electric vehicles (EVs) and you have worked out the cost and gotten buy-in from your drivers, then the next step is to start shopping for your all-new, all-electric vehicles.
Before you go down to your local showroom with your chequebook open, take a moment to assess what you really need. EVs are not one-to-one replacements for petrol-driven vehicles, so there could be opportunities for savings and greater efficiency if you buy intelligently.
The battery factor
A major part of the price of electric vehicles has been the battery – the most common battery types are lithium-based, and lithium isn’t cheap. Fortunately, according to the most recent Bloomberg New Energy Finance report, battery pack costs have fallen 87% between 2010 and 2019 due to economies of scale and better cell chemistry. Currently, batteries cost approximately £118 per kilowatt hour of capacity, and according to this report this figure is set to halve over the next decade.
Cheaper batteries will in turn mean cheaper vehicles. Currently government subsidies are a major factor in reducing the showroom price of EVs, but by around 2024 the upfront price of EVs will become competitive with traditionally fuelled vehicles even without a subsidy. In fact, the new Euro 7 standards for fossil-fuel driven vehicles will cause their price to rise, making EVs comparatively a better deal.
New Lithium Sulphur batteries can potentially double the capacity of EV batteries, but they are several years, if not a decade away from being commercially available.
Time for a change
Businesses who offer company cars for their employees will have a relatively easy time switching to EVs when compared to companies who operate vans and HGVs. Extra weight in EVs has been known to have a greater effect on range than it does on smaller vehicle types, and vans and HGVs are likely to be moving almost continually, whereas smaller vehicles might only be used a few times a day. This and the significantly longer time for charging when compared to refuelling internal combustion engine (ICE) vehicles mean that you may have to plan delivery routes differently, perhaps even changing the make-up of your fleet to compensate.
This could be an opportunity to do more with less – you may find that an estate car or minivan is just as able as a larger van to carry the equipment your workers need to do their jobs, and since they will cost less to buy and run you will be able to make a saving. Some electric vans have a range of as little as 70 miles, so they may not be practical in all cases.
The differences between smaller and larger EVs is important to consider. Although the government will be phasing out smaller ICE-driven vehicles in 2030, it remains to be seen when this change will come for larger vehicles, particularly HGVs.
Major HGV manufacturers like DAF, Iveco, Mercedes and electric vehicle stalwarts like Tesla have all announced they are launching electric HGVs, with Tesla’s Semi having a range of up to 500 miles on a single charge and an expected base price of £140,000. However, 95% of HGVs are still diesel powered and the market seems generally unready to fully switch. While charging stations for smaller electric vehicles are becoming commonplace, commercial charging stations for electric HGVs are rare. Swapping batteries is an option that bypasses the often lengthy charging times, but this may not be an option for everyone, so diesel-driven HGVs may be around for some time to come.
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