Features
12 Feb 24

EC seeks fleet, leasing and rental company views on EVs

Car and van fleets, as well as leasing companies, rental operators and mobility businesses have been invited by the European Commission to share opinions on the best measures to accelerate the uptake of zero emission vehicles (ZEV).

The EC wants to explore whether changes to the purchase price or total cost of ownership of ZEVs, as well as improvements to range and both public charging and hydrogen refuelling would encourage a quicker adoption of electric and fuel cell vehicles.

Vehicle registration tax, annual road tax and the fiscal treatment of cars, light commercial vehicles, and HGVs are also under the microscope in the new 10-week consultation.

“Due to [the] broad role played by corporate vehicles across a spectrum of economic activities, the consultation aims to collect feedback from a spectrum of diverse stakeholders, considering the impacts an initiative in this field could have on all of them,” said a statement from the EC.

Fleets dominate new vehicle sales

Its figures indicate that 58% of new cars bought in the European Union are acquired by corporate fleets, with an even higher proportion of vans and trucks purchased by fleets.

“In order to analyse the state of play of the corporate fleet market, outline challenges and possible areas of action, and collect best practice examples for accelerating the transition to zero-emissions, a broad consultation of stakeholders is needed,” said the EC. “There are significant differences between various types of corporate fleets such as rental fleets, company cars, taxi companies, large logistics truck fleets, etc…”

CO2 reduction targets

The EC’s European Green Deal has set a target of cutting CO2 tailpipe emissions from new cars and vans by 15% by 2025, and by 55% for cars (and 50% for vans) by 2030, compared to 2019 levels. From 2035 onwards, the sale of all new cars and vans in the EU will have to be zero emission.

The new consultation questions whether the transition to ZEVs should happen faster for vehicles registered to corporate clients than private individuals, and asks what the benefits of this approach would be. These could include greenhouse gas savings, a faster build-up of a secondhand market for ZEVs, increased public confidence in zero emission technologies, and a quicker development of smart and vehicle-to-grid charging.

Fiscal incentives, urban access and mandatory sales targets

The EC also wants to know fleet opinions on a variety of initiatives to stimulate demand for ZEVs. These could include fiscal incentives to support the purchase of ZEVs, access to low emission zones or dedicated lanes, as well as mandatory measures that would set minimum requirements for the share of ZEVs in new purchases or across a fleet as a whole.

Conscious of the risk of unintended consequences, the consultation asks how incentives and voluntary measures to accelerate ZEV deployment would impact both the new price and residual values of ZEVs.

It also questions how these measures might impact the competitiveness of corporate fleet owners and operators, and seeks feedback on the minimum size of corporate fleet to which any new initiatives should be applied – 10 or more vehicles, 100 or more, or 1,000 or more.

Leasing reaction

Leaseurope, which represent the leasing and automotive rental industries, has thrown its support behind the EC’s goal to establish a policy framework that incentivises the acceleration of the introduction of ZEVs.

“We believe that only a holistic approach, spanning policy, regulation, fiscal, funding and incentive-demand measures, can succeed in addressing a complex transition,” said a statement from Leaseurope. “This transition needs to address a diverse set of issues such as vehicle availability, vehicle affordability, accelerated private and public charging, grid capacity and power to the site, as well as diverse customer use cases across businesses, both small and large in the EU27.”

It also wants to see a stimulation of the new ZEV market go hand-in-hand with the development of an efficient used EV market and the creation of second and third life leases to support a circular economy.

However, while Leaseurope says many of its leasing company member fleets are ahead of the market in terms of electrification, it warns that mandatory fleet targets across the EU27 will lead to many unintended consequences: “not least the perverse incentive to retain ICE vehicles for longer.”

A healthy corporate ZEV market, it says: “Requires a stable, predictable and supportive policy, fiscal, funding, operational and demand incentive framework.”

The consultation ends on 30 April 2024.

Image: shutterstock_2422031243.jpg

Authored by: Jonathan Manning