Is 2025 The Year to Electrify Your Fleet?
Hailing from Scandinavia, sustainability is ingrained in Mats Dahlstedt’s bones and is a big focus in his role as Integration Solution Specialist at Teletrac Navman. Mats uses his passion for electric vehicles (EV) to help businesses fight climate change, and the value-added benefits they offer like financial incentives and operational efficiencies.
In his time at Teletrac Navman, Mats and his team have focused on how they can help clients reduce their overall carbon emissions and integrate EV’s in their fleet by using insights from telematics. Here he talks about his experiences in effectively reducing carbon emissions.
Electrify for Future Change
The electrification of fleets is gaining momentum, driven both by government targets, sustainability commitments, contract requirements and compelling economic drivers. 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 – because the cost of electric, maintenance, tax and the residual loss of vehicle value are all much lower. This presents a compelling consideration for any business – as fleets filled with expensive vehicles present a low return on investment. By considering EV, businesses will often find they’re able to make drastic savings.
“I’ve seen that the appetite for switching to green measures is certainly increasing amongst fleets across the country, with leasing companies reporting a record spike in demand levels for EVs from company car drivers,” he says.
“Moreover, there is currently a heightened environmental awareness amongst consumers and businesses alike – they are actively seeking information on the green credentials and sustainability efforts of any brand or business, the provenance of goods, the methods of production, and how they’ve been transported. 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.”
EVs are a great option for companies running light vehicles that require their team to run about town and who’s tasks are short. For businesses running heavy vehicles or require a lot of country miles, it may not be feasible just yet. While passenger EVs battery range is increasing with every new model, there is still some way to go before the technology of electrified trucks gets to a point where it’s feasible and cost effective to drive long distances with heavy cargo. Currently, hydrogen-powered trucks on fuel cells are proving to be a viable option, yet still not quite there on range compared to fossil fuels.
Instead transport operators look to technology and the insights that they provide around vehicle performance and driver behaviour to reduce fuel usage and rates, saving business an average of 12.7% since installing telematics, according to Teletrac Navman’s 2019 telematics benchmark report.
Government Incentives
It’s important to note that the total cost of running an EV depends on the federal and/or state incentive schemes that are available to you. Talking about EV strategy in general is difficult because different states and countries have different policies. Here in New Zealand for example, people buying new electric and hybrid vehicles will be able to get up to $8,625 back in a rebate scheme that was recently announced. In Australia, just three states and territories offer discounts on stamp duty and registration including the Australian Capital Territory, Queensland and Victoria.
Subsidies often don’t do much to bring the entry-level pricing of EVs to a more affordable level. This is especially true when we compare it to Germany, who recently doubled its EV grant from €3000 to €6000 ($9,950) until the end of 2021. German EV buyers also receive a 10-year exemption from the annual ownership tax that varies depending on the vehicle but averages out to about €195 ($325). Governments play a big role around the world when it comes to the general uptake of more environmentally friendly cars. Norway is an example of successful EV policies, as now in 2021 87% of new vehicles that are purchased are electrified.
In addition, by being clever in where charging stations are set up, governments can also help boost local economies. If charging stations are set up at local small businesses such as roadside cafés or galleries, it would make a real difference to those businesses and shift people’s money spending away from globally run petrol stations to local economies.
All in all, changing to EVs can be a financial and environmental beneficial solution for company fleets, but it is still up to governments to keep pushing the benefits along in the form of improved incentive schemes and increased funding in the research and development of EV and hydrogen technology.
Insights from Telematics
Until EV’s become a viable option for businesses to add readily into their fleet, telematics goes a long way to reduce your fleet’s carbon emissions. In fact, Teletrac Navman customers have seen up to a 30% reduction in fuel consumption and CO2 emissions after actioning sustainability goals – depending on the fleet setup. As a key part of the supply chain, transport businesses have an opportunity to gain a competitive advantage by improving their sustainability profile. You can effectively reduce your carbon emissions through a more efficient running of your fleet, and technology can certainly help with that.