Arval has reported a 2.9% rise in its UK fleet for 2023, powered by the switch to electric vehicles and the rise of new mobility solutions.

Lakshmi Moorthy, Arval UK managing director

The growth brings the total UK fleet size to 192,068 at the end of December 2023, as the fleet and mobility specialist also reports strong increases for its global operations.

Soaring demand for battery electric vehicles (BEVs) was a particular factor in the growth. Arval’s UK fleet now includes 44,021 BEVs, giving a 23% share of the total – up by 52% year-on-year. The trend accelerated at the year-end and 33% of new vehicle orders placed during December were for BEVs.

Lakshmi Moorthy, Arval UK managing director, said: “The story of our growth in 2023 is very much centred on fleet adoption of zero-tailpipe emission vehicles. Businesses are rapidly moving in this direction, prompted by favourable Benefit-in-Kind taxation and a corporate desire to reduce their environmental impact.”

Supported by low BiK rates, salary sacrifice has gained even more traction and fleet numbers have increased by 48% in 12 months and with more than half being BEVs.

Lakshmi continued: “This is another area where the company car taxation advantages of BEVs are having a significant impact, making salary sacrifice initiatives very attractive to employees who want to lease a car by availing of the very attractive tax scheme in place.”

But Arval also spotlighted growing demand for new mobility options via leasing, helping customers to manage economic pressures while forming a key part of the organic rise in its fleet numbers.

These include Arval’s electric bike leasing programme, launched last year and now being used by customers for last-mile deliveries in urban areas and to keep their staff mobile in cities with Clean Air Zones

Lakshmi continued: “Notably, our electric bike fleet has grown by 133% in 12 months, primarily through electric cargo-bikes. We believe this is a market with huge promise.”

The Arval Re-Lease offering, which enables consumers to lease used vehicles, has also seen strong take-up, recording an 161% increase in lease numbers with a tenfold increase in the number of BEVs leased.

This is supported by the rise in used BEVs now becoming available from previous leases.

“Again, we foresee further growth here in 2024 as this opens up access to attractive used vehicles, including BEVs, at a different price point for a whole new segment in the market. It also democratises access to EVs which may be perceived as expensive.”

Demand for products linked to driver safety grew strongly. Uptake of Arval Accident Management increased by 27%, as did Arval Total Care, a product which increased by 34% and enables customers to bundle most significant vehicle costs into a single monthly payment.

As outlined in the Arval global release, 2024 marks the final year of the Arval Beyond corporate strategy. The new plan will be announced early next year.

Following on from its 2023 business results, Arval will publish its annual financial statement on 8 March 2024.