Having sat on the fringes of the vehicle industry for more than a decade, global annual sales of new electric vehicles (EVs) has now passed the 3 million mark. In 2021 onwards, we will see the rise of the electric vehicle as corporate and governments across the globe prioritise their carbon emissions reduction strategies, with the responsibility now being placed firmly on Original Equipment Manufacturers (OEMs) such as auto industries, to deliver practicable solutions for all price points, distances, and industries.
COVID-19 has sparked further discussion, as people are noticing air quality and noise benefits from reduced vehicle use during lockdown periods, the increased potential for disruption to the global oily supply chain impacts from the pandemic and current economic conditions that provide an opportunity for Australia to use its mineral endowment and skillsets to grow jobs in the EV sector.
Fleet operators are at a crossroads and with the benefits of EVs, there is no doubt that it is the smart way forward for road mobility. So, here’s the key things fleet operators need to know about and consider when it comes to an electric vehicle fleet.
What’s behind the move to electric vehicles and do you have a choice?
Fleet operators cannot ignore the urgency for electric vehicles and for what’s to come in the next decade. Increasingly, global companies have shifted their focus to environmental sustainability, aiming to make responsible decisions on reducing a business’ negative impact on the environment.
The move to electric vehicles is fuelled by surrounding implications of car pollution leading to global warming and interests in improving environmental footprints. The other main reasons for transitioning to EVs include fuel security, public health benefits, improved driving experiences, lower running and maintenance costs, and relative performance. Additionally, auto manufacturers are swapping their effort to electric and hydrogen-fuelled cars instead of internal combustion engines.
If we look at New Zealand's market share for plug-in electric vehicles, they account for 3-4% and fast growing, with some months hitting between 6 to 11% of registrations. The intended target is to reach 35% of new vehicle registrations by 2035.
Why should you consider an electric fleet?
There’s the philosophical answer, and there’s the operational answer.
Firstly, it goes without saying that we should all care about looking after the planet. There is a heightened environmental awareness amongst consumers and businesses alike – they are actively seeking information on the green credentials of any brand or business, the provenance of goods, the methods of production, how they’ve been transported and more.
The latest IPCC report paints an urgent reminder that global warming poses a grave risk to humanity, and it is up to each one of us to accelerate the global effort in finding solutions. If you can be seen to make a positive step in tackling a major polluting part of your business, it could potentially pay dividends for maintaining existing contracts and picking up new ones in the future.
Secondly, in the long run the total cost of ownership of an electric vehicle will be much less than a vehicle with an internal combustion engine – the cost of electric, maintenance, tax and the residual loss of vehicle value are all much lower. Currently, that initial amount is quite high given the limited options on the market, however the number of EVs is expected to grow as cheaper models arrive and more charging infrastructure is rolled out.
Why should you start the transition now to an electric fleet?
Imagine having to switch your whole fleet over in one fell swoop, or in very close proximity at least – the bottom line would take a hammering!
Where business processes allow, changing over to an electric vehicle is the best use of capital expenditure when vehicles have done their mileage. And to help you along the way, there are fleet incentives to help businesses and local councils buy electric vehicles and more EV charging stations being built– this may change as we get closer to 2030 with more people changing over, so take advantage while you can.
We understand that the switch to an electric fleet isn’t a simple one, but there are other ways you can encourage an environmentally conscious workplace before you implement electric vehicles.
Encouraging sustainable transportation would be a step in the right direction:
- Support your team members in taking alternative modes of transportation to and from the office—such as walking or carpooling with fellow colleagues.
- Biking or riding a scooter is also a convenient mode of transportation, contributing to an array of benefits, including saving fossil fuels and reduced traffic congestion.
- Company policies regarding travel could also be updated to include selecting public transport options or searching for eco-friendly car rentals, as well as reducing the number of layovers on a flight.
We hope the information we’ve provided will help you make a more informed discussion with internal stakeholders and financial decision makers within the business as to the best direction to take towards your future electric fleet, and towards a more environmentally sustainable business.