Benefits of Electric Fleet Cars for Businesses
While it’s somewhat old news that a ban on the sales of new petrol or diesel cars is coming into effect in 2030 – it’s certainly not something business owners should put to the back of their priority list. The deadline is creeping up, and for companies with fleet cars, this transition is important for both the planet and the bottom line.
However, it’s understandable that it’s also a significant change. Not just in leasing new electric cars and vans but also in ensuring adequate infrastructure is in place to support the switch over. Moving to an electric fleet is beneficial for businesses in many ways. Take a look at some of the main ones below:
1.Reduced running costs
Running a fleet is costly for many businesses, especially with the price of fuel fluctuating unpredictably. In comparison, running an electric car offers significant savings against traditional fuel costs.
Comparing the electric Nissan Leaf with a petrol Nissan Micra on Zap Map’s journey cost calculator, for example, provides the following estimates for a 100-mile journey:
- Leaf (electric) – £7.74
- Micra (petrol) – £20
2.Lower maintenance costs
Electric cars are slightly different to conventional vehicles in that they don’t have as many moving parts. There’s no engine, complex exhaust system, radiators or injection system. This means servicing and general maintenance overall is reduced.
The battery is an element to consider when owning a vehicle for longer than eight years, as they begin to degrade. However, this is not an immediate concern with lease vehicles as you can switch to a newer car at the end of the contract period.
3.Savings for city driving
If your fleet of cars and vans drive into London, the savings on congestion charges are substantial. For example, an electric vehicle driving into London daily could save around £5,000 on congestion and ULEZ charges compared to driving a diesel car.
When you have several fleet cars, this total soon adds up. If other cities decide to introduce similar low emission zone charges, this will also save money if you do business in these areas.
4.Reduced Benefit in Kind (BiK) rates
Company car drivers get significant savings on Benefit in Kind tax when choosing an electric vehicle. The current rates (2022-2025) start at 2% for electric cars and 23% for hybrids. The amount an employee pays in company car tax is also based on annual salary and the vehicle’s value. So with an electric car, this reduces the overall tax amount considerably, sometimes by hundreds of pounds!
Employees driving a company car can also claim 5p per mile. Plus, charging an EV at work is also tax-exempt.
5.No road tax
Another cost of running fleet vehicles is the road tax. However, moving to a fully electric fleet has another benefit – zero vehicle excise duty (VED). This charge is calculated on the emissions at the tailpipe, and as there are none, you don’t have to pay road tax.
That said, hybrid vehicles do incur road tax charges, typically between £0 and £105 in the first year, depending on the emissions. Subsequent tax years cost £145 per year.
6.Greater range capabilities
One of the factors that often puts businesses off switching to electricity is the range of EVs. This is no longer a worry with a variety of models offering extensive range capabilities. Still not convinced? Check out these range examples:
- Volvo C40 – average 256 miles
- Peugeot 2008 – up to 214 miles
- Audi e-Tron – up to 248 miles
- Jaguar i-Pace – up to 292 miles
- Mercedes Benz EQA – up to 453 miles
* Figures shown are averages, and range capability is subject to several factors, including vehicle model, driving conditions, speed and optimum charge rates.
7.Improve rapid charge point access
Some companies are concerned about the feasibility of EVs as company cars due to charging times and convenience. However, as the network expands, there is more access to rapid charge points across the UK. Not only that, these are set to grow further as the government ramps up plans to fund more installations.
Current electric car models offer between 140 and 350 miles of range between charges – which is typically enough for most company car journeys. But if a quick charge is needed, rapid charge points provide around 80% charge in approximately 30 minutes. So, it’s an ideal time to take a break, grab a coffee and wait for a top-up.
8.Grant for workplace charge points
The government is ramping up its electric charge point installation target across the UK. This will improve accessibility to all EV drivers, including company cars. However, to help improve the transition, businesses can access the Workplace Charging Scheme (WCS) grant to install charge points at numerous premises.
This voucher-based scheme gives eligible companies access to upfront funds to purchase and install EV charge points. The grant provides up to 75% of the cost of buying and installing the equipment with a cap of £350 per socket.
Companies can apply for up to 40 sockets across business sites. So, as an example, if you have 20 locations, you can get two sockets per site. This grant is a great way to make the move to electric easier and gives EV drivers access to electric for work use.
Improving your company’s green credentials
One of the main focus areas of switching to an electric fleet is reducing carbon emissions. By making the switch, you’ll be helping the environment and doing your bit for the air quality in your local area. However, as it’s clear above, there are also a number of benefits to your business’s bottom line – making it a cost-effective change in the long run.
At Leasing Options, we have many EVs from top brands such as BMW, Volvo, Audi and Mercedes. With our help, you can enjoy all the benefits of affordable company car leasing alongside lower running costs and tax savings.
Thinking about switching your fleet to electric? Contact our team to check out the latest deals.
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