The Business Magazine November 2023

Dont make costly mistakes in the rush to be green warns fleet management expert Total Motion

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A leading fleet management expert is warning that organisations can be manipulated by PR into moving to Greener vehicles, when there is a lot more to consider before making the move. This is not a simple case of the media pumping out ‘fake news’, there are considerable cost benefits to having an electric vehicle (EV) fleet, and it can undoubtedly boost a company’s public profile, but Total Motion managing director, Simon Hill, can talk from vast experience when he describes the “incredible temptations” of moving to EVs too soon, and how it can be a costly mistake.

Indeed there are tax, environmental and operational cost benefits to moving away from petrol and diesel vehicles and embracing the brave new world of alternative fuels, which can include EVs but also LPG and biofuel vehicles. But having worked with alternative fuels for over 20 years, Total Motion – a leading fleet management provider – has partnered with many customers initially dazzled by the PR sheen of Greener operations, to the point that key considerations were being ignored.

Costs of whole life vehicle ownership

Thankfully Total Motion are able to highlight the need for an approach which applies the Total Cost of Ownership (TCO). This fundamentally considers all physical and practical factors involved in EV fleets, such as charging downtime, where charging can be carried out, investment costs, maintenance, reliability and whole life costs.

None of this is designed to rule out or put a negative spin on the transition to EVs, this is inevitable given the Government’s 2030 target to stop selling vehicles powered by traditional fossil fuels. There are many cost and practical benefits to driving EVs, but only when the change is implemented at the right time for the organisation.

The best way to approach this, says Simon Hill of Total Motion, is to adopt an Actual Whole Life Cost (AWLC) model, which acts as an accurate source of data to help manage the transition to alternative fuels such as EVs. This analysis system provides accurate statistics on the environmental impact of a current fleet and offers recommendations on how to reduce the organisation’s carbon footprint. This doesn’t automatically result in a transition to EVs, or at least not yet.

Delays in charging infrastructure

Also, there is some doubt about whether the Government’s 2030 target date will stay in place anyway, so in very simple terms the “rush to be Green” may be a little hasty. It is widely predicted that there will be a deficit in the number of charging points needed by 2030, even though there are currently more EV charging points in the UK than individual petrol pumps. The nature of the garage forecourt is slowly changing, but there is a long way to go, as Simon explains:

“The current tax implications for operating electric and hybrid vehicles is making it incredibly tempting for fleet managers to move away from diesel and petrol models. However, rushing to ‘green’ fleets can be a costly mistake, and the brakes need to be applied before making any sudden change based solely on tax calculations. There are other important factors too – in particular the down time for recharging batteries and a vehicle’s overall reliability.”

Preparing for the transition to EVs

Simon also warns that people were similarly swayed by PR when assessing the benefits of switching from petrol to diesel fuels. With EVs the issue surrounds battery capacity, where vehicles will be stored overnight and if charging infrastructure is sufficient.

This presents a huge challenge to the fleet management industry and involves considerable investment and planning, and also requires businesses to factor in the possible costs of ‘retiring’ current vehicles too soon. Is the current fleet ready to be replaced and is it cost-effective to do so? This is very much a case of a business getting ‘all its ducks in a row’ as a primary objective. Otherwise a business could be taking a big hit financially with only an intangible PR boost to counter it, at least initially. The change to EVs is inevitable, and ultimately the right thing to do, but the key is not to rush it and to consider a ‘whole life’ approach.