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Supply issues threaten fleet EV switch, says AFP

Scientist holding a semiconductor

Vehicle supply issues are becoming a major threat to fleet electrification plans, according the Association of Fleet Professionals (AFP).

The organisation, which represents fleet professionals, believes the situation is unlikely to improve in the near future.

The issue is significantly affecting electric cars but the situation for vans is even more acute, according the the AFP, and means that some businesses are even considering adding petrol and diesel vehicles back onto their choice lists.

Paul Hollick, AFP chair, said: “We are in a position where many company car drivers are placing huge pressure on their employees to move them into EVs because of the current benefit in kind advantages but the supply to satisfy that demand is very frequently unavailable.

“Some manufacturers are even asking fleets to take certain EVs off choice lists because they simply do not know when any orders might be able to be fulfilled and, to fill the gaps, some employers are considering readopting ICE (internal combustion engine) vehicles, which seems like a deeply retrograde step but might be the only practical solution.”

Some fleets are turning to social media, such as LinkedIn, to issue general appeals for any leasing companies that can provide the vehicles they need, because their usual supply sources are failing. This creates a potential issue by taking them outside of trusted supply arrangements, Hollick warned.

New vehicle supply challenges are expected to persist in the automotive industry throughout 2022, according to analyst KPMG.

It follows a year when fleet and business new car registrations fell by 4.5%. Overall, new car registrations grew by a marginal 1% during the year, as 1.65 million new cars entered the UK market.

The figures underline the ongoing impact of Covid and the semiconductor shortage, with the market down 28.7% on pre-pandemic 2019, representing the second worst year since 1992.

The same issues are threatening industrywide efforts to begin adopting electric vans.

“Many of our members were expecting that this year would provide a genuine opportunity to begin electrification of their light commercial vehicle operations but it appears as though supply is even poorer than for cars with delivery dates for many models unavailable.

“This creates a real conundrum. Ongoing supply issues mean that many are now operating vans that are sometimes more than six years old. They really need changing for basic reliability and safety reasons but delivery times are unavailable for the electric replacements that businesses want to acquire,” Hollick said.

A final problem was being encountered by some fleets and their drivers finding it difficult to get home charging installed.

Hollick explained: “Semiconductor shortages are at the heart of most EV supply disruption and the same is true of chargers. Some drivers who have been able to get cars or vans are therefore unable to charge them effectively. This is creating a further layer of frustration.

“Certainly, there is a view emerging across our organisation that the current situation makes the government’s 2030 rule for complete production electrification look increasingly optimistic. The nearest time that it appears supply might normalise is well into 2023 and it would now require a huge effort to meet the official deadline.”

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