The direction of travel for the UK fleet industry in 2026 is clear. Electrification is no longer optional, operational costs are under sharper scrutiny and regulatory pressure is intensifying. The landscape is being reshaped primarily by domestic policy, economic conditions and infrastructure constraints. For fleet managers, the priority must be delivering practical, cost-effective transition strategies.
The ZEV Mandate — From Policy to Operational Reality
The most significant driver of change is the Zero Emission Vehicle (ZEV). In 2026, 33% of new cars and 24% of new vans must be zero-emission vehicles, up from 28% and 16% respectively in 2025.
This escalating quota will directly affect vehicle availability. Manufacturers will prioritise electric models to avoid financial penalties, tightening the supply of new petrol and diesel vehicles further. This will lead to:
- Reduced model choice for new internal combustion engine (ICE) vehicles
- Longer lead times for popular diesel vans
- Strategic allocation of production slots to higher-margin electric vehicles
This is not a short-term fluctuation — it is a deliberate structural shift. If your fleet strategy still relies heavily on diesel procurement cycles, you may face increasing constraints and pricing pressure.
Accelerated EV Adoption, Ready or Not
According to the Society of Motor Manufacturers and Traders, new battery electric vehicles are expected to make up 28.5% of the market by the end of 2026. This is a shortfall compared to the ZEV mandate, but with fleet purchases accounting for 61.2% of that, the importance of EV adoption cannot be overstated.
For van operators, the challenge is sharp. Electric van technology has improved, but range limitations and payload concerns remain key operational considerations. Nevertheless, ZEV makes electrification a commercial necessity — the question will be how to do so efficiently. That includes:
- Analysing duty cycles in granular detail
- Phasing vehicle replacement to align with ZEV availability
- Prioritising urban and last-mile routes for early adoption
The fleets that move decisively will secure supply and develop operational expertise sooner. Those that delay may find themselves competing for limited stock.
Total Cost of Ownership Becomes the Central Metric
With acquisition costs for EVs still higher up front, scrutiny will shift to whole-life cost management. The high volatility in inflation and business operating costs from the last several years has a lag effect. Even as headline inflation moderates, fleets remain exposed to rising labour, energy and parts costs.
Fleets that treat electrification as a data challenge rather than just a procurement decision will likely have a competitive advantage. Fleet management software, to help minimise downtime and maximise efficiency, will become increasingly important.
The industry is likely to see greater adoption of:
- Telematics and AI-driven route optimisation
- Predictive maintenance systems
- Data-led charging management to exploit off-peak tariffs
EVs typically have fewer moving parts and lower routine servicing requirements, but tyre wear and repair costs remain significant. Managing driver behavior — acceleration, braking, load management — can directly influence your TCO performance.
Meanwhile, industry concern continues to rise regarding the new Electric Vehicle Excise Duty (eVED) introduced in the Autumn Budget and planned for 2028. This pay-per-mile road tax will clearly have major implications for the fleet industry. The consultation closes on the 18th March, and professionals are encouraged to take part.
Infrastructure — Progress, Not Parity
Charging infrastructure remains a constraint, particularly for commercial vehicles. According to Zapmap, there are now over 45,000 charging locations in the UK, comprising 88,513 points. However, availability is uneven across regions and high-powered charging suitable for vans and larger vehicles remains limited.
Depot charging investment will therefore be essential. However, grid connection delays and local capacity issues continue to pose obstacles. You may encounter:
- Extended timelines for depot upgrades
- High capital expenditure for power reinforcement
- Operational planning complexity during installation phases
For multisite fleets, strategic planning around site electrification will be as important as vehicle procurement. Infrastructure decisions made in 2026 will determine your operational flexibility for years to come.
Supply Chain Volatility and Vehicle Availability
The global vehicle supply chain is still hampered by semiconductor shortages, this time due to AI data centre demands. Ongoing trade friction and import cost pressures are also affecting the industry. For fleet operators, that translates into:
- Variable lead times for new vehicles
- Potential fluctuations in parts pricing
- Greater emphasis on forward ordering
As ICE production volumes decline under ZEV targets, residual values for certain diesel models may temporarily strengthen in the used market due to constrained supply. However, over the medium term, tightening environmental regulation could dampen demand.
You should expect used vehicle pricing to remain complex in 2026, with pockets of both inflation and depreciation depending on powertrain type.
Labour Shortages and Skills Gaps
Manufacturing, including the auto industry, is particularly vulnerable to labour shortages across the supply chain. This directly impacts production and assembly, further adding to supply chain volatility.
Structural labour pressures also persist. The Road Haulage Association continues to highlight recruitment and retention challenges. It estimates that to cater for the 80% of goods travelling by road freight, the UK needs to train 60,000 new drivers per year for the next five years.
Electrification introduces a parallel skills gap. Technicians require high voltage training, and drivers need instruction on regenerative braking, energy-efficient driving and route planning around charging infrastructure. Forward-looking fleets in 2026 will invest in:
- EV-specific driver training programs
- In-house or partnered high-voltage technician certification
- Clear communication strategies to address range anxiety
The workforce transition is as essential as the vehicle transition.
Shifting Gears from “If” to “How”
The fleet industry debate no longer centres on whether electrification is viable. It is now focused on execution strategies. Success will depend on integrated planning across procurement, infrastructure and workforce development. Fleets that adopt a phased, data-led approach — piloting routes, analysing performance and scaling methodically — will build resilience. The road ahead is demanding, but navigable. If you prepare strategically in 2026, your fleet can confidently compete in the new landscape.
Author: Evelyn Long, Editor-in-Chief of Renovated Magazine
