The main pull of an electric car fleet is the massive environmental benefits. Electric cars have zero tailpipe emissions, meaning they produce no carbon dioxide and contribute towards reducing air pollution.
Also, as a fleet manager, consider how an electric fleet will look for your business. It shows customers that you care about your business's sustainability and carbon emissions, which goes a long way to securing repeated custom in 2023.
Lower fuel costs
Although electric vehicles cost a little more to lease, you'll make up for this with savings in fuel costs. According to EcoExperts, the cost of running an electric car is 11p per mile, compared to 14p to 19p per mile for a petrol car (NimbleFins).
You can also charge your electric fleet in various ways. The most popular choice by fleet managers is to install 7kW chargers at your site, which charge the vehicle overnight for roughly £17. However, you might need to use the public charger network as well, which costs around £20 - £25 for a full charge (source: PodPoint).
Vehicle rentals are VAT recoverable – If your electric fleet is used solely for business purposes, you can reclaim 100% of the VAT on your monthly payments. This reduces to 50% if the fleet is used for both business and personal use.
Payments are tax deductible – Because your fleet will be completely emissions-free, payments are tax-deductible up to 100%. However, to qualify for this, the rentals need to be even over the lease term, and you can't have the option to buy the car at the end of the contract.
Benefit in Kind (BiK) tax applies to those who receive a company car for private use. For electric vehicles, BiK tax sits at just 2% for 2023/24, compared to 22% for petrol vehicles.
The growth of the UK electric vehicle market
Another reason to go electric for your fleet is to get ahead of the rush towards electrification. In November 2020, the UK Government announced plans to phase out the sale of petrol and diesel cars by 2030, and by 2035 all new cars and vans would be emission-free.
To help achieve this, the Government is introducing a ZEV mandate in 2024 which will set annual targets for manufacturers' new car and van sales to be zero emission. As a result, manufacturers have placed a huge emphasis on their electric car production in the UK and Europe.
Ford wants to become all-electric for their passenger cars in Europe by 2030, and premium brands such as BMW, Audi, and Mercedes-Benz are producing more EVs every year. For fleet managers, this means there's a great range of electric vehicles to choose from.