Benefit in Kind changes to drive Electric Vehicle Fleet Purchases

Half of UK fleet managers are predicting an uptake in electric company cars thanks to Benefit in Kind tax changes

One-third of the UK’s fleet managers expect more than 50% of their company car fleets will be electric within five years, according to a new Go Ultra Low survey.

The joint government and industry campaign to promote the uptake of electric vehicles (EVs) questioned 500 key fleet managers and decision-makers that are responsible for running the full spectrum of vehicle fleets, from a handful of cars to more than one hundred vehicles.

The survey, commissioned in partnership with the Energy Saving Trust, was designed to better understand the existing company fleet mix as well as the key considerations when it comes to purchasing and leasing EVs. Britain’s fleet sector accounted for 53.3%* of last year’s 2.3m vehicle registrations and is seen as a pivotal player in accelerating EV adoption.

The survey responses revealed an overwhelming appetite to embrace the electric era, with nine in 10 fleet managers enjoying the idea of driving and owning an electric company car and seven in 10 committing to purchase an EV within the next two years.

The recently revised changes to Benefit In Kind (BIK) – where the tax liability for fully electric company car drivers falls to 0% in 2020-21 and marginally increases to 1% in 2021-22 – has also resulted in a renewed interest in company car schemes. Yet while more than half of all managers (53%) questioned predicted an uptake in demand for electric company cars within their organisation, nearly one-third of respondents (32%) were not aware of the newly announced changes to BIK.

According to the survey, the three key factors that inhibit EV adoption amongst fleet managers include the elevated price point of electric vehicles (47%) and their limited range (51%), as well as a lack of chargepoints (56%). In fact, 40% of respondents had no charging provision at work so were reliant entirely on public infrastructure.

Reflecting on the findings, Poppy Welch, Head of Go Ultra Low, said: “Today’s research highlights that the Government’s Benefit-In-Kind tax incentives are helping to shift behaviour around company fleets and the car industry is supporting with exciting products. There are around 60 electric models now available and most are able to travel more than 200-miles on a single charge. The decisions fleet managers make about EVs today will be critical in driving mass adoption tomorrow.”

She continued: “The UK now has more than 31,000 public chargepoint connectors, and an additional 500 chargepoints are installed each month, but we still hear from businesses that charging infrastructure remains an area of frustration. Fleet depots and rental branches, for example, often need to negotiate complex terms with landlords, electrical consultants and energy providers to install their own chargepoints. That’s why we’re developing a series of fleet-specific initiatives with the help of the Energy Saving Trust, to provide companies with the information and advice they need to make the transition to electric as seamless and cost-effective as possible.”

Don't forget, if you have at least one electric car or van within your fleet, pluginsure might be able to help you with a fleet insurance quotation!

*Figures provided by the Society of Motor Manufacturers and Traders (SMMT)