Why fleet managers should not delay the transition to EVs

The government may have postponed its ban on the sale of new petrol and diesel vehicles, but firms shouldn’t take that as a sign to defer electrifying their vehicle fleets

A fleet manager walks through a company lot, looking at data on a tablet

It wasn’t exactly a strategic decision that added the first electric vehicle to the AA’s fleet. It was more a case of waste not, want not.

“The PR team called us, saying that they needed an electric van for an advertisement, so we bought one and got it branded up,” explains Simon Ungless, who joined the firm at the end of 2021 as commercial group fleet manager.

Once it had fulfilled its role as a marketing tool, the van became the first electric roadside-assistance vehicle in the AA’s 2,500-strong fleet.

That fleet has since incorporated about 80 more EVs and the company is now set on full electrification. It was not prompted to ease up on its strategy by the government’s decision last September to defer its ban on the sale of new petrol and diesel cars from 2030 to 2035. 

But relatively few companies in the UK have shown such initiative and resolve so far. Full fleet electrification is a complex project that requires careful planning and, even though the investment will pay back in the long term, many decision-makers remain reluctant to commit to EVs for the time being. 

The benefits of making an early transition to EVs

Research suggests that the high initial outlay associated with electrification is the key reason why companies are delaying their transition. For instance, a poll of 200-plus UK fleet decision-makers on behalf of software firm Webfleet in Q1 2023 revealed that cost pressures had prompted 76% of them to postpone such plans. 

If we install a charger at a driver’s home and they leave the company a week later, we can’t very well go and rip it out

As Angela Hultberg, global sustainability director at management consultancy Kearney, notes: “We know it’s cheaper over time to own and operate an EV, but the initial cost is putting people off. What does it matter to them that something might be 25% cheaper if its upfront cost is three times higher?” 

That said, she would advise any firm to start planning for electrification sooner rather than later. 

“I’m not sure there is any benefit in waiting,” Hultberg says. “Over time, EVs will lower your costs and reduce your scope-three emissions, which is a high priority for many companies.” 

Hesitant firms risk incurring considerable costs further down the road, when there will be more pressure on vehicles and their supporting systems. Moreover, the early movers will have more influence over essential arrangements, such as charging infrastructure, adds Hultberg, who believes that cooperation between firms will be vital in this respect. 

Fleet managers should start preparing an EV strategy now

Starting the transition early can also help a company to solve unexpected electrification problems before they affect its whole fleet. Hultberg recalls one such dilemma she faced in her previous job as head of sustainable mobility at Ikea.

“We invested in electric vehicles and installed chargers, but we hadn’t conducted upfront energy assessments,” she says. “One day, the facility manager in France called us and asked whether they should keep the ovens going in the kitchen or charge our trucks, because they couldn’t do both.” 

The demise of the internal combustion engine in the UK may appear to have become more distant since the sales ban was pushed back to 2035. But David Watts, EV fleet product manager at Volkswagen Financial Services, points out that the Department for Transport’s mandate on zero-emission vehicles still stipulates that 80% of new cars sold in Great Britain by 2030 will have to be electric.

“If you’re relying on having that full five-year window, you’re going to struggle,” he warns, adding that fleet managers should take the lead in developing a transition strategy for the next six years.

“Given the typical fleet replacement cycle, it’s important to start now,” Watts says. “Do that by building a picture of what the current fleet looks like, in terms of both vehicle operations and capabilities.” 

Planning an EV transition strategy 

The key first step for a fleet manager is to gain a comprehensive understanding of how their existing vehicles are performing. Questions to consider include: how are they being driven? What sort of mileage do they clock up? What kind of terrain do they cover? Where are they stored and what functionality do we need from them? This will help the manager to gauge what they’ll typically require from an EV and what type of charging and maintenance infrastructure might be needed. 

In many organisations, hearts and minds will need to be changed too. Some employees may benefit from training on the importance of electrification, while others could require tuition in how to adapt their driving techniques to optimise the performance of EVs. 

Given the typical fleet replacement cycle, it’s important to start now, by building a picture of what the current fleet looks like

“In some cases, you might even be able to reduce the fleet significantly before electrifying,” Hultberg says. “How many miles can you take out by optimising routes and services? Which routes make the most sense to electrify? How far do your vehicles travel each day? Do you have reliable routes with access to charging infrastructure?” 

The AA has formed several project teams, spanning fleet, IT and HR management, to address such questions. Over the next 18 months, data will be collected from the firm’s existing 80 EVs to inform its strategy. 

The company will consider carefully which vehicles it requires and what functionality will meet its needs. The AA’s drivers have unpredictable daily routes, for instance, making it hard to understand the range required of an EV. 

The work of its patrol drivers can be unpredictable and varied too. They could be changing a brake pad at the roadside and then towing a broken-down SUV on their next assignment. 

“The vehicles need a decent capacity and payload, so that they can do most jobs,” Ungless says. “You don’t want to say to a driver whose car has broken down that you need to drive somewhere to get the part it needs because your electric van can’t carry it.” 

The AA must also have a coordinated plan for its charging infrastructure, which isn’t easy for a firm with a largely home-based workforce. 

Ungless explains: “If we install a charger at a driver’s home and they leave the company a week later, we can’t very well go and rip it out. But, at the same time, it doesn’t look good if a customer pulls into a supermarket car park and sees a row of commercial vans charging up at a public charging point.” 

Watts believes that a significant number of firms have been daunted into inaction by the perceived complexities of the initial planning stage. 

“Many organisations are stalling, because you do need to collect a lot of data and build a really big picture of each vehicle and driver in a way you’ve never had to do before,” he says. “But it’s not necessarily difficult. And, once you have that picture, you can build your transition strategy and start actually testing vehicles.”