Navigation of a sustainable and successful switch
Toby Poston, corporate affairs director, BVRLA, discusses the best ways to prescribe the right solutions for zero emission transition
Toby Poston, director of current affairs, BVRLA
Supported by powerful incentives, business leasing has been the leading force in battery electric vehicle (BEV) adoption to date. As the BEV market grows – and with the targets of the Zero Emission Vehicle (ZEV) mandate set to ratchet up – we need careful co-ordination of fiscal incentives and other government interventions to cover all use cases and routes to market. The ‘EV ecosystem’ needs nurturing if it is to grow in a sustainable, healthy way that avoids one sector bearing the full responsibility.
While some segments of the market – such as business leasing – are performing well, others require targeted support to accelerate EV adoption and meet the ambitious targets. The unintended consequences of the mandate are pushing supply into areas where demand struggles to keep pace. Regardless of whether a vehicle begins its life in rental, corporate fleet, or as a private registration, nearly every vehicle eventually enters the used market. Currently, the used BEV market is immature and dangerously volatile, with residual values plummeting over the last two years as volumes have shot up.
For the transition to succeed, both new and used markets need to be robust. The overall health of the total market relies on both succeeding in tandem. Healthy, stable residual values underpin competitive motor finance rates on new vehicles. The RV declines we have seen cannot continue if the level of new vehicles entering the market is to be retained. To successfully decarbonise road transport in a sustainable way, the used market needs support to stabilise as it matures. Although the ZEV mandate applies directly to new vehicle sales, its influence ripples through the entire market.
While a more immediate concern for electric cars, concerns over new vehicle supply and second-hand values are more than present in the electric van market too.
“Currently, the used BEV market is immature and dangerously volatile, with residual values plummeting over the last two years as volumes have shot up”
The electric van transition is in urgent need of a treatment plan. In early 2024, a coalition of leading commercial vehicle trade associations, e-van specialists and decarbonisation experts – BVRLA, Logistics UK, Recharge UK, the Association of Fleet Professionals (AFP) and the EV Café – launched the ‘Zero Emission Van Plan’. With e-van sales stalling, the coalition is urging the new government to take immediate action to revive this critical market and foster wider adoption of zero emission vans.
Eliminating regulatory barriers is essential, particularly in aligning 4.25-tonne electric vans with their diesel counterparts. The heavier weight of batteries compared to fuel means that e-vans need to carry more weight to match the performance of diesel vans. However, current regulations impose additional burdens on these vehicles.
Even where suitable vehicles are coming to market, operators are struggling to access the right parts of the charging network at the right time. The rapid expansion of public charging networks across the UK risks leaving commercial vehicles behind.
The BVRLA’s 2024 Road to Zero Report demonstrates the scale of these challenges. Despite notable progress in the rollout of charge points and improvements in reliability, the overall charging experience could be greatly improved. Van-friendly charge points remain scarce – and there is a widespread call for the ability to reserve charge points in advance and for more straightforward payment processes. Direct improvements to on-site signage would also improve the charging experience and help operators to avoid costly downtime.
While the new government holds the keys – and the purse strings – required to address many of these concerns, it would be wrong to assume that government intervention is the silver bullet to make the transition a success. It is undeniably a crucial cog in the machine. Other parts must play their part too. Industry collaboration, private investment, and innovative developments must all occur in tandem.
Just as the new and used markets rely on each other to keep both healthy, the sector is relying on public and private efforts to go hand in hand.
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