Electric vans can pay for themselves within three years, while non-EV users are looking to switch within five years, new research has found.

EVs’ reduced cost of ownership means they could pay for themselves within three years; and non-EV users are looking to switch within five years

The analysis, carried out by the Centre for Economics and Business Research (CEBR), also found that SMEs are increasingly adopting EVs as they recognise the significant business benefits, ensuring that EV adoption is not just being led by major corporates.

The report was commissioned by Ford Pro to better understand the broader European commercial van landscape, comprised of 23 million SMEs. This includes owner operators, which account for 99% of businesses in Europe.

The study of more than 1,000 commercial van drivers found that these businesses are already realising significant energy cost savings as well as improving their productivity and operations with supporting technology.

Analysis of the total cost of operating electric vans compared to diesel or petrol equivalents found electric vehicles can make up for their higher initial purchase costs within a typical three-year ownership timeframe.

Survey respondents said reduced operating costs were the top reason to switch to EVs (46.3%) supported by annual EV van charging costs of €3,700 vs €12,400 (£3,152 vs £10,562) for a petrol or diesel van.

Beyond financial benefits, the survey also found why SMEs are turning to EVs. Access to Low Emissions Zones was the joint most common reason to switch (46.3%), followed by concern for the environment (45%) and brand reputation (45%).

Charging time was the biggest concern for those who have not yet switched to EVs (38.1%) with upfront purchase costs also an issue (37.7%). Despite this, amongst those yet to switch, a majority (58.6%) said that they were at least somewhat likely to choose an electric van over the next five years.

Operators that have already switched to EVs are more likely to recognise the importance of technologies and services that complement van ownership. Amongst business adopters of technologies and software, the overwhelming majority reported positive productivity impacts. This was particularly the case for those adopting vehicle safety and security measures, fleet management solutions, and communication software.

Similarly, an overwhelming majority of business software adopters reported positive operational impacts. This was particularly likely among adopters of compliance and reporting systems, telematics integrated with other systems, and communication software.

Potential for EV adoption accelerates in most markets

The Economics of Commercial Van Usage Across Europe 2024 also shows a dramatic change in the EV landscape since the 2019 edition.

The report includes an update to the Electrification Index, a measure of commercial EV adoption status and future potential for five prominent European van markets: France, Germany, Italy, Spain and the UK.

The Index explores factors including electric van sales, charging points, incentives and the increase in Low Emission Zones – and identifies that adoption and potential increased in most markets since the last calculation in 2018.

Key findings include that Germany had the highest EV proportion of new van registrations in 2023 at 9.5%.

The UK showed the greatest growth in electric van sales since the last report in 2018, with share increasing from 0.3% to 6%.

France is identified as the market with most electrification potential, just as it was in the 2018 research, reflecting its already strong adoption of electric vehicles and high-quality charging infrastructure. However, Spain showed the most improvement in its Electrification Index score overall.

“The transition to electric could bring considerable societal benefits on both local and global scales, primarily through the mitigation of harmful pollutants and greenhouse gas emissions,” said Nina Skero, chief executive of CEBR.

“Our analysis also demonstrates that vans already support a significant proportion of economic activity across European markets. Indeed, van-reliant industries contributed €860bn to European Union economies last year. The portion of this figure attributed to electric vans is expected to grow as adoption continues and more businesses realise and accrue EV operational savings.”