The gap between the haves and have nots of EV adoption is becoming a chasm, says Toby Poston, corporate affairs director, BVRLA.

Toby Poston, corporate affairs director, BVRLA

The decarbonisation divide is growing. While targeted incentives have accelerated corporate uptake of electric vehicles, the private sector is falling behind. Business drivers and fleets are underpinning the UK’s progress towards the ZEV mandate targets. As those mandate targets ratchet up in the coming years, they cannot bear the weight of the EV transition alone. The spotlight must turn to the private sector – it needs igniting.

This divide is highlighted in the BVRLA’s recent Leasing Outlook report. The association is seeing its member lease fleet growing, but the disparity between the business and retail segments – particularly for EVs – is a real concern. Despite the positive trajectory of the lease fleet, the imbalance between business contract hire (BCH) and personal contract hire (PCH) shows how the financial pressures from high interest rates, car price inflation and the cost-of-living crisis are hitting private drivers hardest.

Amid these challenges, there are trends emerging that show where positive progress is being achieved. The report reveals a remarkable 47% year-on-year surge in demand for salary sacrifice cars. Buoyed by a fair tax regime and corporate ESG strategies, demand for BCH is up 7.1% for the same period.

The surging BCH market is accelerating the adoption of cleaner, greener vehicles onto UK roads.

In Q4 2023, 75% of new additions to the BCH fleet were battery powered (BEV) or plug-in hybrids. For PCH, the situation is flipped, with petrol accounting for two-thirds of new registrations.

The challenges associated with PCH demand are surmountable but require a collaborative effort to overcome. As vehicle manufacturers confront the reality of their performance relative to ZEV mandate targets, the leasing sector continues to play a crucial role in ensuring the decarbonisation of road transport stays firmly on course.

Where incentives are working in the favour of corporate customers and fleet operators, it has been the opposite story for charging infrastructure. At a local level, too many decisions have been made with private drivers front of mind. Charge point locations, as well as their power output and accessibility, are routinely overlooking fleet needs.

“Where incentives are working in the favour of corporate customers and fleet operators, it has been the opposite story for charging infrastructure. At a local level, too many decisions have been made with private drivers front of mind.”

Fleets represent the majority of miles driven across the UK. Based on the current imbalance with registrations, that proportion could easily rise in the short-term. Despite this, only a tiny proportion of local authorities are talking to fleets about their needs. Our latest Fleet Friendly Charging Index shows that 49% of local authorities have a plan in place, up from 37% last year. That number drops to a single-digit percent when looking at those directly considering fleet requirements.

Although momentum is growing in the number of local authorities developing EV strategies, a major disconnect remains between local authorities and the fleet sector. Armed with the results of the Index, the BVRLA is talking to local authority EV contacts. There is a clear need to communicate where the fleet sector is ready and waiting to collaborate. Bridging this divide is essential to ensure effective collaboration and to enhance local authorities’ understanding of fleet requirements.

This is a joint effort, not only with local authorities, but with the energy sector and other key stakeholders. All must seize the opportunity to contribute significantly, paving the way for a smoother transition to electric mobility and reinforcing the UK’s commitment to the ZEV mandate targets.

Whether looking at who is making the transition to electric vehicles, or how they are able to charge them, the imbalances between business and private customers are stark. Road transport decarbonisation is a race where victory is only truly achieved when every participant successfully crosses the finish line. Only through concerted action can we bridge these gaps and ensure an equitable transition to electric mobility.