What’s needed for EVs

The fleet sector’s calls for continued work on a green recovery strategy and electric vehicle incentives in this spring’s Budget.

All eyes will be on this year’s Budget on 3 March 2021 to see how the chancellor plans a particularly precarious balancing act for 2021 as the pandemic continues to impact the economy.

Last year’s Red Book, published in the early days of the outbreak, was dominated by the Government’s first response to coronavirus; a theme that will be carried on in the 2021 Budget, which will – according to HM Treasury – set out the next phase of the plan to tackle the virus and protect jobs.

But alongside the £30bn package announced last year to boost the economy and help get the country through the outbreak, there were rather a lot of fleet-relevant announcements; including the long-awaited confirmation that previously announced company car tax rates would go ahead for the 2020/21 tax year, including the 0% BiK on EVs, and frozen at 2022-23 levels for an additional two years. The Red Book also included announcements on further incentives for EVs and charging as well as funding for pothole and roads repairs.

“Many of these businesses and individuals are struggling financially and can’t yet find an electric vehicle that meets their needs or budget.”

Gerry Keaney, BVRLA chief executive

All of these however need to remain a core focus in the 2021 Budget, according to key figures within the fleet sector.

This includes work to ensure that EVs are at the forefront of buyers’ minds when it comes to new vehicles; and something that’s a major part of the BVRLA’s Budget wish list.

Chief executive Gerry Keaney says that last year was a catastrophic year for the car market but a tipping point for electric vehicle uptake.

Keaney comments: “The chancellor must continue to ring-fence the long-term grants and tax incentives that make electric vehicles affordable. He must also resist the urge to pile more motoring tax increases on fleets and drivers that have yet to make the transition to zero-emission motoring. Many of these businesses and individuals are struggling financially and can’t yet find an electric vehicle that meets their needs or budget.”

According to the BVRLA, the Government’s close work with business fleets to develop a set of powerful grants and tax incentives and invest in a robust public charging network must remain a focus; SMMT figures show most (68%) of pure electric and PHEV new car registrations in 2020 were for company cars.

Ashley Barnett, head of consultancy at Lex Autolease, also says that 2020’s fall in new car registrations shows just how challenging the coronavirus pandemic has been for the motor industry and echoes the comments about a need for a green recovery strategy.

“As we set our sights on recovery in the post-Covid global economy, we must remember that accelerating electric vehicle adoption needs to remain at the top of the industry’s New Year’s resolution list if we’re serious about achieving the ambitious Road to Zero targets,” he outlined. “The growth in EVs is comforting but ultimately is from an extremely low base – only 6.6% of vehicles on the roads are EVs (including PHEVs).

“All eyes will be firmly on the Spring Budget and the rumoured plans for a road pricing scheme which may go some way to recoup lost tax revenue when EVs begin to overtake conventional ICE models. The chancellor has an opportunity to reassure would-be EV drivers that fiscal incentives will remain on the table and incentivise them to take the first step into alternatively fuelled vehicles.”

And the Association of Fleet Professionals has also called for EV-specific measures in the Budget to provide continued incentives for electrification.

Chair Paul Hollick remarks: “The concern isn’t so much in the corporate space but in the retail space: scrappage schemes to get diesels off the road and what can the Government do to get people into cleaner vehicles, particularly electric vehicles.”

He continues: “Obviously the BiK tax tables finish 2024/25 so it would be nice to see what the Government has planned after that. We’re on this road map to 2030 and for all fleet managers, electrification is the number one topic for everybody.

“The great thing is that, as you would expect, there’s a lot of demand from our drivers to be in electric vehicles because of the BiK rates. But for us, it’s only a couple of [vehicle] cycles away. And what we’d really like to know is what the future is in the second half of the decade.”

Paul Hollick, chair, Association of Fleet Professionals

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