Upfront costs and charging points are biggest barriers to EV fleet switch

The upfront cost of transitioning to electric vehicles (EV) and worries about access to charging points are the leading barriers to businesses switching their commercial fleets to EVs, according to new research conducted by Startups.co.uk.

With increasing pushes towards better air quality, such as the recent expansion of the London Ultra Low Emission Zone (ULEZ), the research comes at a pivotal moment for commercial fleet owners. 

The research aims to gain an understanding of how commercial fleets are responding to external challenges like inflation, rising fuel costs, regulatory compliance and emissions targets.

Cost the main blocker to electric vehicle switching

To understand attitudes towards electric vehicle switching, Startups surveyed 88 UK-based commercial fleet owners in May. The insights found that 26% of UK commercial fleet managers said cost was their main reason for not switching to EVs, while 22% cited a lack of vehicle charging points. 

EVs not meeting business requirements, the availability of EVs from suppliers, and cost of charging were among other leading concerns.

UK fleets were found to have stronger forces to incentivise them to make the switch than their US counterparts, with 32% of UK fleets saying they would make the switch to meet compliance standards. Reducing operational costs was flagged as the second most popular reason for making the switch at 25%.

Clean air zones and government input

The report is timely given the expansion of the ULEZ scheme in London on August 29, which is hitting the pockets of SMEs already struggling to stay afloat in the challenging economic climate. 

The ULEZ scheme has been widely criticised by both businesses and the wider public, despite the government expanding its vehicle scrappage scheme in an attempt to support SMEs.

As part of the changes, a grant per van was raised from £5,000 to £7,000, and the number of vans or minibuses small businesses and sole traders can scrap increased to three.

In the report, only 6.8% of businesses said they had no concerns regarding the impact of clean air zones like ULEZ on their fleet running costs – while 34.1% said they had ‘large concerns’.

Business doubts about UK targets

Over half of respondents either disagreed or weren’t sure when asked if they were confident the UK will meet its net zero target in 2050, and 64% of those that didn’t agree believe the government should provide greater financial support and guidance to help them reduce carbon emissions. 

In addition, 93% of those that do think the UK will meet the target say that the government needs to provide more specific carbon reduction support to the fleet sector. 

The report found that the majority of fleets expect to reach carbon neutrality within the next decade – with 5-10 years being the most common timeframe at 44%. Despite compliance and emission target changes, 8% of UK fleets said they have no plans to reach carbon neutrality.

Last month, the UK government launched the UK Business Climate hub to help Britain’s 5.5 million SMEs save on their business energy bills while reducing their emissions. The hub also features advice and support on switching employee modes of transport and paying less for company EVs.

Relevant content:

• Workplace Charging Scheme: a complete guide for employers
• What is fleet management?

Kirstie Pickering - business journalist

Kirstie is a freelance journalist writing in the tech, startup and business spaces for publications including Sifted, TNW, UKTN, The Business Magazine and Maddyness UK. She also works closely with agencies such as CEW Communications to develop content for their startup and scaleup clients.