Analysis
13 Sep 19

Why (and how) corporates should adopt EVs

Even in a country as EV-friendly as the Netherlands, employers are doing way too little to electrify their vehicle fleets, a recent survey shows. How to do better? Two fleet suppliers and one fleet customer – all Dutch, all with better-than-average EV track records – offer useful advice. 

At the end of last month, we published the results of an EVBox survey of 1,000 corporate drivers in the Netherlands. It showed that no more than 18% of employers use fuel as a criterion to direct their employees towards choosing an EV or a hybrid for their next company car. 

That abysmal statistic knocks the wind out of a widespread assumption about electrification that goes something like this:

  • electrification of mobility is both necessary and imminent; 
  • corporate fleets are pioneers of mobility innovation; and
  • the Netherlands is one of the world leaders in vehicle electrification.

Ergo, Dutch corporate fleets should be way ahead of the curve when it comes to the introduction of EVs. The EVBox survey suggests otherwise. So we’ve gathered two expert opinions on the way forward. We asked each:

1.    Which arguments can convince fleet managers to electrify their vehicles? 
2.    Which measures can fleet managers apply to facilitate EV introduction? 

First, Arno Veenman, Advisor HR Expertise at de Volksbank. Last May, he was awarded the title of Mobility Manager of the Year in the Netherlands, in large part because of his electrification drive. No less than 40% of de Volksbank’s vehicles is a full EV.  

1.    Arguments for electrification

CSR
“The main argument for companies to promote the use of electric and hybrid vehicles is sustainability, as part of Corporate Social Responsibility (CSR). The right mix of vehicles helps improve your corporate image. So don’t ask why – ask: Why not?”
“Companies should not wait until the last moment to fulfil their climate obligations. Electric mobility will become the new normal, but it will take some effort. If your company has a head start, you’ll be better able to withstand setbacks when it comes to CO2 emissions reduction.”

Cost
“Cost reduction is another great argument to go electric:

  • currently, some EVs are already equal in price to some diesel cars;
  • plus, charging an EV costs a lot less than refuelling a car with an internal combustion engine (ICE);
  • private use of EVs will be smaller because the limited range will not be suitable to all personal trips (such as vacations);
  • hybrids, for their part, have a lower price for mileage per litre of fuel; and
  • combining electric mobility with public transport will also reduce the cost of mobility (also thanks to less need for parking spaces).”

“For the drivers themselves, having an EV will reduce their tax bill for the private use of their corporate vehicle by lowering their ‘bijtelling’ (the fiscal parameter linked to a vehicle’s CO2 emissions, Ed.)”

2.    Measures for electrification

Policy
“Make sure electric and hybrid vehicles are possible within your leasing arrangement. There are still some companies that offer only petrol and diesel cars. In your policy, lower the maximum CO2 emissions of new leasing vehicles in cascades, if possible or necessary all the way to zero. Set a sustainability target – this provides certainty for both fleet managers and employees with company cars.” 

Network
“Why not join a network of corporates working towards sustainable mobility. You can benefit from each other’s knowledge and experience. One example is a coalition called Anders Reizen (‘Travel Differently’).”

Practical

  • “Make sure the lease agreement covers the provision of home EV charging points;
  • make sure charging points at work locations are visible, in order to promote the EV principle;
  • provide not just corporate vehicles, but also mobility alternatives such as public transport subscriptions, or even bicycles, giving employees a choice between various mobility modes; and
  • in the years to come, provide solutions specifically for employees going on holiday.” 

Next up is Stephan Trimbos, Manager Marketing & Business Development at Alphabet Netherlands – EV leader on the Dutch lease market and provider of AlphaElectric, a comprehensive package for fleet electrification. 

1.    Arguments for electrification

CSR
“Actually, the majority of our fleet customers, especially larger companies, are very consciously working towards making their fleet – in fact, their entire mobility – more sustainable. In practice, we do not see a need to convince them anymore. Smaller customers are catching up to that level of awareness as well: the transition to full EV is also taking place, but just at a slower pace.”
“All our fleet customers offer their employees the possibility to lease a full EV, with roughly half actively promoting this. At present, roughly one-third of our new contracts is a full EV, and we are seeing interest increasing rather than decreasing Many of our customers feel that they have a social exemplary role and often act on two motives:

  • ‘planet: realisation of sustainability objectives; the reduction of the CO2 footprint is becoming increasingly important; and 
  • ‘people’: Sustainable and fiscally attractive mobility helps to recruit and retain valuable employees.” 

Mobility
“Larger corporates no longer automatically opt for a lease car, but also make sure to offer alternative mobility modes, such as cycling, public transport and various sharing formulas. We see this reflected in the increasing demand for Alphaflex, Alphabet’s mobility budget formula. So, a full EV is one of the options for making mobility more sustainable, but certainly not the only one.”

2.    Measures for electrification

  • “Don’t limit the vehicles on offer in your policy, either by brand or by type;
  • enable EV charging at your various business locations;
  • if possible, include home EV charging in your lease contract;
  • offer employees a higher lease budget as incentive to choose a full EV;
  • make sure employees know about the lower ‘bijtelling’ compared to ICEs;
  • offer ICE alternatives when EVs don’t suffice (e.g. when taking the car on holiday); and 
  • make full EVs mandatory. This is an extreme measure, but several of our customers have already decided to go ‘all the way’ with EV.”

And finally, Liam Donnelly, general manager of Arval Netherlands.  Earlier this year, Arval opened a Mobility Hub in the Netherlands – the first of its kind globally – a showcase of Arval’s current and future range of mobility products and services, including electric mobility. 

1.    Arguments for electrification

Better TCO
“We spend a lot of our time advising our clients on their Company Car Policies. This is based on a TCO approach, and predominately covers petrol and diesel engines. However, the world is changing and the opportunity for employees to select a BEV is certainly increasing.” 

  • “Nearly 20% of our corporate clients fully accept the use of BEVs. As the TCO of these vehicles becomes more acceptable, we expect this number to rise.
  • For our private customers, I think the number of BEVs (6%) will rise when these vehicles are more price-competitive against their petrol equivalents.”

Wider selection (and range)
“To date, however, the BEV selection has been quite limited, as has been the distance covered by the battery power. But again, this world is changing. The power of the batteries has certainly improved allowing an employee to drive considerably further distances on a single charge. Furthermore, the number of BEV charging stations has also increased. Add to this the new models that the Manufacturers will bring to the market in 2020 and then you will see a significant change, both at a corporate as on a consumer level.”

2.    Measures for electrification

Mobility budget
“Arval has a responsibility to recommend other mobility options. With a mobility budget, the employee has the freedom to choose the most efficient methods of travelling within a defined budget. With all these new options and changes, the employer has more and more choices to make. In this changing world, sustainability, unprecedented opportunities and our personal choices all go hand in hand.”

Authored by: Frank Jacobs
Advertorial: