Fleet News

LATEST: Fleets still hesitant over electric vehicle take-up

A growing band of manufacturers are putting their wager behind electric vehicles as the medium-term answer to the ‘environmentally friendlier’ fuels dilemma.

The Government, too, is backing this particularly strategy with its £5,000 incentive, available from next year. Could they both be wrong?

Many believe so, from fleets to experts to some carmakers.

Fleet News asked 80 fleets for their view. Just five were trialling or planned to trial electric vehicles. For the rest, it wasn’t even on their radar.

Then take the view of Toyota. While it plans to launch an electric iQ-type car in America in 2012 that could come to the UK, Toyota has put its weight firmly behind hybrid and plug-in hybrid as the best medium-term solution.

A spokesman said: “The plug-in Prius hybrid will offer customers greater flexibility than fully electric, because there is no range restriction as it can be refuelled with petrol.”

Critics’ concerns centre on the practical – range, infrastructure, costs – and the environmental: is battery technology that draws energy from the national grid really that green?

The emissions output and running costs of EVs depend on the source of the electricity. Best is wind and solar power; worst is coal-fired.

“It would be too simple to claim that the electric car is completely eco-friendly,” said Bernd Bohr, chairman of Bosch.

“After all power is not generated only from renewable sources.”
In the UK, around 76% of the energy mix is generated from fossil fuels (coal and gas). On a full life basis, the Department for Transport estimates EV emissions to be 106g/km.
Competitive, but not market leading.

That will improve, of course, as the energy mix moves in favour of more sustainable sources.

Ultimately, though, for fleets the main question is cost. Is an EV cheaper from purchase to disposal than diesel?

It’s not cheaper to procure: Mitsubishi has just slapped a £34,000 price tag on its i-Miev. Fuel and SMR costs, and depreciation will have to be very low to make up this initial disadvantage.

“The costs are way in excess of a comparable diesel,” said Jonathan Shine, managing director of electric vehicle supplier Drivelectric.

“There are positives to EVs – low running costs, no fuel price volatility, fun to drive, good image, etc – but there are challenges, such as battery reliability and residual values.”

The low running costs are undeniable, according to Calvey Taylor-Haw, managing director of Electromotive, which supplies EV recharging stations. It costs just 2p per mile to run an electric car and 5ppm for an electric van.

But these are not wholelife costs and do not take into account the purchase price nor replacing battery packs.

A battery pack for a Transit-based electric van costs £20,000 to replace.

With more employees likely to switch to EVs to take advantage of the five-year BIK tax holiday that starts next year, new questions are being raised.

“How long before employers seek payment for the electricity used by employees charging their cars at work?” asks Taylor-Haw. “Cost will have to be recovered and is likely to be seen by HMRC as a benefit-in-kind.”

Battery life and range - the important questions answered

Limited battery life and range are two pressing issues for fleets.

But many fears are unfounded, said Kevin Harkin, Smith Electric Vehicles sales director

Its lithium-ion batteries come with a five-year warranty, although he claimed they will last much longer.

“We say five, but we know they will go for 10, even 15 years,” Harkin told Fleet News.

“The batteries suffer just 1% degradation on charge each year.

“With new technology coming out we will see some batteries with a 30-year guarantee.”
When a battery cannot be charged to more than 80% of its original capacity it should be replaced.

“But even then the energy companies will buy them,” said Harkin.

This changes the RV risk picture. And Smith Electric claims its vans are doing well in the used market.

“We will see one of our vans, which are £55,000 new, getting £10,000 after five years,” said Harkin.

That’s an RV of 18%. Diesel Transits tend to achieve around 16% on CAP, although at a much lower price new.

The other concern – range – should not be an issue for many van fleets.

“One-fifth of LCVs (up to 12 tonnes) do less than 60 miles a day and then return to base,” said Harkin. “The main factor in range is the driver, which is why we are very strong on driver training. It can have a dramatic effect on range.”

Range is also being addressed through new battery technology.

“We will see EVs with a 200-mile range so the need for rapid charging stations will diminish,” said Calvey Taylor-Haw, MD at Electromotive.

For all the latest advice and information on fleet management, have a read of our fleet operations section.


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