The growing gulf between EV demand from businesses and private drivers is unsustainable and needs government action, according to the BVRLA.

The BVRLA said consumer demand for EVs “needs igniting”

The rental and leasing industry body has published its new Leasing Outlook report, revealing strong take-up of battery-powered (BEV) and plug-in hybrids (PHEVs) among business contract hire (BCH), but growing concern for EV adoption among personal contract hire (PCH).

The figures for Q4 2023 show 75% of new additions to the BCH fleet in Q4 2023 were BEVs or PHEVs. For PCH, the situation is flipped, with petrol accounting for two-thirds of new registrations.

The BVRLA said the widening gulf between business and retail demand for EVs was a real concern.

Toby Poston, BVRLA director of corporate affairs, commented: “Benefit-in-Kind and salary sacrifice incentives have fast-tracked corporate uptake of electric vehicles and are underpinning our progress towards the ZEV mandate targets. Fleet operators and business drivers cannot bear the weight of the EV transition alone, especially as the mandate targets ratchet up in future years. The spotlight must turn to the retail sector. It needs igniting.”

Cap HPI’s Dylan Setterfield, head of forecast strategy, said the Government has many tools at its disposal to address the imbalance between business and retail demand for BEVs and ensure the terms of the ZEV mandate can be met.

“An obvious change would be harmonisation of VAT, where public charging costs can be reduced to make EV running costs cheaper for those without off-street parking.

“Other measures must be on the table too and include exemptions from tolls or discounted parking charges. In short, incentives are required. The annual increases set by the mandate only get steeper between now and 2030.”

However, while many had called for such measures to be introduced in the recent Spring Budget, there was a distinct lack of BEV action.

The full BVRLA Leasing Outlook report, which includes analysis from Auto Trader, Cap HPI and Fleet Assist, is available here.