Category: Electric Vehicles

Electrification is one of the biggest buzzwords for fleets as we move towards NetZero2050. Transport continues to contribute a huge amount of pollution, accounting for 24% of UK emissions in 2020 and standing as the largest emitting sector in the country. Fleet electrification is an essential step for operators who want to become accountable, decrease their carbon footprint, and maintain a good reputation for sustainability.

Fleets can look very different from business to business, and electrification can mean different things depending on what the specific vehicle architecture within your fleet looks like. That’s why this article will examine what fleet electrification is and how it can impact different businesses.

What is fleet electrification?

Electrification is about removing technologies that operate using fossil fuels and replacing them with tech that uses electricity instead. For fleets, this primarily means shifting from combustion engine vehicles to hybrid and electric vehicles and supporting the installation of the infrastructure necessary to support them.

What does fleet electrification look like for different fleets?

Fleets look different from business to business, and can have a range of different vehicle types that can make the process of electrification really varied.

Vans and LCVs

There are over 1.5 million vans registered to UK companies, of which only 0.3% in 2019 were ultra-low emission vehicles – making this vehicle category a prime subject for electrification. The variety of electric vans on the marketing is increasing, as is the support on offer to help facilitate the purchase of these vehicles.

The Plug-In Vehicle Grant includes a range of low emission and electric vans offered at discount prices to help increase the uptake of these more sustainable vehicles by last mile deliveries, professional services and other businesses with fleet vans. The discount is automatically added to eligible vehicles.

You can read more about electric last mile vehicles here.

HGVs and Buses

For heavier goods and passenger vehicles, electrification can seem like a significant challenge. With mileage one of the main concerns for those looking to switch to electric vehicles, HGV, bus, and coach drivers might be hesitant to put faith in electric alternatives due to the need for long distance mileage.

Despite this concern, the technology in electric vehicles is rapidly improving and we are seeing the mileage capability of larger EVs increase significantly with fully electric HGVs now capable of up to 110 miles on a single charge.

You can read more about electric HGVs here.

Cars

The most common type of vehicle on the roads, cars, are an essential in the personal and working lives of many, and if you drive a company car or manage a fleet of cars then electrifying your vehicle/s might be of interest to you. Electric cars have seen significant development in the last decade and the choice for these vehicles is vast, putting those looking to invest in electric fleet cars in a beneficial position.

For taxi businesses interested in expanding their fleets electric vehicles, the aforementioned Plug-In Vehicle Grant similarly offers discounts on taxis offering savings of up to £7,500. There are also approaches to the acquisition of electric cars you can take to help ease the cost and convenience including salary sacrifice schemes that encourage uptake with staff.

You can read our deep dive into the real cost of electric cars for UK fleets to learn more about what electrifying your company cars will look like financially at every step of the process.

Electrification for SMEs

While larger companies might be in a better economic position to make larger short-term investments into electric vehicles and the charging infrastructure to support them, SMEs might find the initial costs of electric vehicles and vehicles charge points off putting. However, there are still options for SMEs.

With an increasing uptake of electric vehicles both at home and by businesses as we move closer toward our collective NetZero goal, there are range of government support schemes in place to help with the cost of both electric fleet acquisition and the cost of implementing charging infrastructure.

Workplace Charging Scheme

Expanding your EV fleet is not just as simple as acquiring the vehicles, and in order to make electric fleet vehicles really work for your business it could be worth equipping your business’ premises with charge points so as not to rely solely on public charging.

The Office for Zero Emission Vehicles offers the Workplace Charging Scheme to help support businesses with cost of installing electric vehicle charge points at work places, offering as much as £350 per socket and up to 40 sockets per business.

You can read more about the Workplace Charging Scheme including the requirements, eligibility terms, and details on how to apply here.

The Plug-In Vehicle Grant

We’ve mentioned the Plug-In Vehicle grant, which offers a discount on purchases on eligible new electric and hybrid or ‘plug-in’ vehicles. This is a discount that is applied automatically at the dealership, and can benefit businesses looking to invest in electric vans, motorcycles/mopeds, trucks and taxis. Unfortunately, the scheme no longer includes cars.

For those looking for ways to help fund the introduction of electric cars to a business fleet, read our article on salary sacrifice for electric cars.

Our growing EV solutions

With the acquisition of fleet vehicles, it pays to be set up with the right tools. From installing charging points to covering the costs of recharging on the road, Fuel Card Services can help. We have a growing range of electric vehicle charge cards to choose from and are expanding our range of electric services.

Get in touch today if you want to learn more about the electric vehicles services we’ll be offering or refer to our EV solutions for news, updates, and information.

The cost-of-living pinch is being felt in personal and business life by all, and fleets are no exception. With the cost of second-hand vehicles and vehicle leasing on the rise, companies looking to introduce more electric vehicles into their fleets need to consider their options in order to build an electric fleet in the most cost effective manner.

In this blog we’ll break down what salary sacrifice is and how fleets can use it to electrify their fleet in a way that benefits the company’s and employee’s wallets alike.

What is a salary sacrifice car scheme?

Salary sacrifice is an arrangement between employer and employee to reduce the employee’s entitlement to cash pay in return for a non-cash benefit, such as an electric car. The cost of the car is then deducted from the employee’s salary each month before they are taxed.

A salary sacrifice car of any kind will usually be supplied by a partnered supplier and will often come in a package deal meaning that salary sacrifice EV packages may also provide users with charging infrastructure and other benefits.

2017 tax changes

In April of 2017, changes were made to tax rules that mean employees need to pay income tax on either the amount of salary sacrificed or the value of the car. Whilst this does mean that the salary sacrifice schemes aren’t quite as beneficial as they once were, they still offer a host of valuable benefits, particularly for companies/employees looking to reduce environmental impact with electric vehicles.

Is EV salary sacrifice worth it?

Whilst the tax savings may not be as significant as they were in previous years, salary sacrifice schemes still offer great perks for both companies and their employees, and is a scheme that could be well worth utilising for the following reasons:

1. All-inclusive packages

Generally, electric cars and other vehicles are on average still somewhat more expensive than combustion engine vehicles, particularly when you account for the infrastructure needed to run them. Many salary sacrifice car schemes offer all-inclusive packages that will provide employees not just with the electric car but also with a home charging point and installation as well as other benefits such as servicing maintenance discounts.

These perks quickly add up, and those opting for a salary sacrifice fleet vehicle will find themselves saving money not just on the vehicle but on all the important extras that go with it.

2. Better electric cars for a lower price

Salary sacrifice schemes for electric vehicles offer fleet drivers a more affordable price for newer electric vehicles. This is because companies with agreed partnerships to salary sacrifice car providers will get better deals on newer cars than if the employee looks to lease an EV independently.

3. No deposit

Putting down a deposit on a new vehicle can often be pricey and off putting, but with salary sacrifice schemes, there is usually no deposit for the employee to pay. This makes the acquisition easier on employees’ pockets.

4. OZEV tax advantages

The Office for Zero Emission Vehicles are a government office supporting the UK in increasing the uptake of electric and hybrid vehicles as well as implementing EV infrastructure. Electric company car drivers benefit from a lower BiK rate than combustion engine drivers, so whilst there is less of a tax break than before 2017, using salary sacrifice to acquire EVs still offers a lower tax rate.

OZEV also have other schemes in place like the Workplace Charging Scheme which can help businesses to introduce EV charging infrastructure to business sites.

How promoting a salary sacrifice scheme can help your business

Salary sacrifice schemes do offer the most saving potential for employees but there are also benefits for employers too – from money saving to improving employee retention.

Reducing National Insurance contributions

Salary sacrifice schemes knock down the National Insurance contributions for both employer and employee. Whilst there isn’t as large a tax saving as there was in years gone by, there is still a monetary saving to be made here.

Better cash flow

The uptake of salary sacrifice schemes can have a positive knock-on effect on cash flow for businesses. These schemes are typically deducted from pay before taxes, which offers a better cash flow for employers.

Employee retention and satisfaction

Opportunities for staff like salary sacrifice schemes are great for employee retention as they diversify the compensation to employees, and this range of benefits can improve retention by rewarding commitment to the company.

Increase sustainability

When it comes to increasing the number of electric vehicles on the roads, sustainability is the key thing in mind. Electric vehicles serve to reduce a company’s carbon footprint, and for companies with active fleets, the saving can be significant when the switch is made.

Reducing costs with Fuel Card Services

Whether your EV fleet is growing with a salary sacrifice scheme or you are using other means to expand your electric vehicle tally, keep cutting costs with electric charge cards from Fuel Card Services. Our range is growing, and with so many benefits to reap, and thousand of locations to use them at, these charge cards are a great opportunity to save money and time on admin costs.

Use our quick enquiry form to get in touch and we’ll help you to find an EV charge card or fuel card that fits your fleet’s needs.

For assistance with all things EV, take a look at our EV solutions.