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The electric vehicle fleet conundrum

Tony Donnelly, chief executive, Goodwood Corporate Mobility

The fleet and motor industries and politicians must unite to provide a co-ordinated timeline and pathway to establishing electric vehicles as a viable corporate mobility choice.

That’s the call from Tony Donnelly, chief executive of Goodwood Corporate Mobility, to the new Government following December 12’s general election.

While acknowledging that electric cars and vans are the corporate motoring future, Mr Donnelly said: “Businesses require a robust platform on which to base their vehicle decisions – built by those who understand and work in the arena where it matters: fleet decision-makers, motor manufacturers and the charging point industry working in partnership with ministers.”

He highlighted that:

  • Politicians were playing a ‘date game’ by proposing to ban the sale of petrol and diesel cars and vans earlier and earlier – from 2030 to 2040 depending on political party – with the Labour Party advocating that all car fleets go electric by 2025
  • The rush to ‘go electric’ would leave a financial black hole in HM Treasury coffers amounting to £33.7 billion in ‘lost’ fuel duty and VAT alone, according to a recent report by the Institute for Fiscal Studies.

Mr Donnelly, who drives a 100% electric BMW i3, said: “As we enter a period where every politician reaches for a topic on which they will hope to get the attention of the voting public to get them elected – we need to take account that many of them are the same people who have dithered over and mis-managed the British economy for the past 41 months and who said that diesel was the fuel of the future until it was ‘demonised’ in the media in respect of air quality.”

Pointing out that the Government’s ‘kneejerk’ reaction to encouraging zero emission vehicle company car demand was to slash benefit-in-kind tax from 16% in 2019/20 to 0% in 2020/21, increasing to 1% in 2021/22 and 2% in 2022/23, Mr Donnelly said: “That sounds great for drivers, but not such good news for drivers’ employers.

“I am all in favour of the electric vehicle revolution and I spend my working week with businesses who want to embrace this wonderful and powerful proposition. But they are unable to do so for reasons that include: Vehicle cost, battery range concerns, an inadequate national recharge infrastructure and the requirements of drivers who travel long distances and struggle to find the time to recharge.

“Those advocating the rush to rid the country of combustion engine vehicles by 2025 or soon after don’t have the remotest idea of the real world practicalities and care even less what their clean air vision requires ahead of implementation. The environment is hugely important, but not to the exclusion of all that is sensible and essential from a business perspective.

“Progressive businesses need to get their people and products to their markets and that requires a combination of mobility services. To the fore is the company-provided car for those who prefer the flexibility a vehicle offers, instead of and assuming that public transport will work for them.”

That, said Mr Donnelly, required ‘a balancing calculation’ adding: “Employees required to drive long distances will, from April 2020, be financially disadvantaged by the absence of a comprehensive electric vehicle charging network. As a result, through no fault of their own, they will be paying significantly higher company car benefit-in-kind tax on an internal combustion engined model.”

Meanwhile, reports of a race by company car drivers to embrace electric vehicles from April 2020 due to tax incentivise could, said Mr Donnelly, be undermined by vehicle supply constraints. Additionally, employers must be aware of a health and safety consideration as driving an electric vehicle was not exactly the same as driving a combustion engined car so performance familiarisation was required.

But, he said: “Fleets should not abandon the electric vehicle proposition, but they should not rush head long into embracing the technology simply because it looks attractive from a benefit-in-kind tax viewpoint. Detailed analysis of drivers’ journey profiles must be undertaken as a starting point to check the practicality of electric vehicles.

“Fleet electric vehicle viability must be explored with balance in mind. The technology is viable, but only for some businesses and drivers. Decision-makers must be guided by experts who know how to balance the introduction of the electric vehicles against business requirements and proceed with caution.”

Mr Donnelly concluded: “The fleet market has both a huge potential and desire to lead the rapid national acceleration of electric vehicle take-up, but for many it is still too difficult to make the switch in the real world. Politicians must understand that and those elected on December 12 must work with the fleet and motor industries to understand the challenges faced and then deliver realistic – not kneejerk – solutions over a viable timescale.”

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