Why It’s Time to Seriously Consider Electric Vehicles (EVs)

Although mass-produced Electric Vehicles (EVs) have been around in the UK since 1996, they’re only just starting to gain popularity.

Sure, the models look pretty cool and feel smooth to drive from a consumer perspective. However, did you know that there are also tons of benefits for businesses that invest in electric vehicles?

If you’re not sure whether going down the EV route is right for your company, not to worry. We’ve got you covered with this short and simple guide.

What Are EVs (and What’s All the Fuss About)?

First things first, what exactly is an EV? Allow us to break it down for you.

All-electric vehicles can also be referred to as battery electric vehicles. Instead of an internal-combustion engine, they have an electric motor and run on electricity. Because of this, EVs don’t have the usual liquid fuel components, such as a fuel pump, line or tank, and don’t emit exhaust fumes from a tailpipe.

Whether you like the sound of them or not, the electric car market is growing rapidly in the UK. In fact, there were over 345,000 pure-electric cars on our roads at the end of October 2021. There were also more than 657,000 plug-in vehicles including hybrids, which run on a combination of electricity and conventional fuel.

The Benefits of Switching to Electric Vehicles for Your Fleet

EVs can benefit your business in a number of ways, from reducing running costs to creating a green brand image.

Let’s explore them one by one, shall we?

1. EVs Are Becoming More Available

Firstly, not only are EVs becoming more widely available in general but so are the different types of EVs.

In the UK, you can get a range of car models that fall under the electric vehicle umbrella. That said, you can also get vans in an electric capacity, including:

  • Citroën ë-Dispatch
  • LEVC V5
  • Mercedes-Benz eVito
  • Nissan e-NV200
  • Peugeot e-Partner

Furthermore, the UK government just announced that they will be phasing out new, non-zero emission Heavy Goods Vehicles (HGVs) weighing 26 tonnes and under by 2035. Likewise, all new Heavy Goods Vehicles (HGVs) sold in the UK will be zero-emission by 2040.

In other words, you might as well get on the bandwagon sooner rather than later!

2. The Number of Charging Stations for EVs Are Increasing

New charge points are being added daily for EVs. In truth, there was an increase of 220% in the number of public chargers at supermarkets and service stations between 2016 and 2020.

This is super convenient for personal and business EV owners alike. Not to mention, charging an electric vehicle can take as little as 30 minutes.

The UK government also recently unveiled a new design for public charge-points, which prioritises inclusivity and ease of use.

How Much Does It Cost to Install Charging Points at a Workplace?

Concerned about the expense of switching to EVs? We hear you. That said, the government has associated financial schemes for businesses that can help.

For instance, the Workplace Charging Scheme (WCS) supports eligible applicants with 75% of the purchase and installation of EV charge-points, up to a maximum of £350 per socket.

This WCS grant can be used for the installation of up to 40 charge-point sockets per applicant, which is handy given that you expect to pay between £1,000 and £2,500 for a commercial EV charging point.

How Much Does It Cost to Install Charging Points at Home?

In addition to the WCS, the government offers an Electric Vehicle Homecharge Scheme (EVHS). This is a grant that provides a 75% contribution to the cost of one charge-point and its installation, which is capped at £350.

Typically, a basic charging unit costs around £800 nowadays. Having said that, if your employees aren’t able to buy a charging unit for home use, they can still charge their EV at one of the many public charging stations available locally.

3. EVs Are Exempt from Clear Air Zone Charges

In 2017, local authorities began to introduce Clean Air Zones to bring down nitrogen dioxide levels and improve air quality. The idea is that if you drive in a Clean Air Zone and your vehicle exceeds emission standards, you may have to pay a charge.

The great thing about EVs is that they’re exempt from these charges. Truth be told, more than £120m of government funding will soon be available to help businesses switch to eco-friendly, compliant vehicles.

The Clean Air Zone Financial Support Scheme launched on 30th November 2021 accepting applications from HGV drivers initially and expanded to other vehicles from January 2022.

Imagine what this commitment to environmental responsibility can do for your brand image. Not only will this create positive associations in your ideal customer’s mind, but it will also build trust for the long term.

4. EVs Are Subject to Tax Benefits

In 2019, the government announced that there will be zero tax on Benefit in Kind (BiK) during 2020 and 2021 for company car drivers and fleet operators that have electric vehicles.

This zero percentage rate on BiK, which is essentially company car tax, will only increase to 1% in 2021/2022 and 2% in 2022/2023.

EVs are also subject to the below tax relief:

  • When it comes to purchasing electric cars, businesses can claim 100% of the cost against the profits of the first year of purchase from 6th April 2020, no matter what this figure is.
  • The aforementioned First Year Allowance (FYA) scheme was extended for cars and also introduced for vans from 1st April 2021.
  • HGVs and Light Commercial Vehicles (LCVs) currently qualify for Super-deduction capital allowance, meaning that businesses can offset 130% of the asset value against their taxable profits in that first year. For example, if an asset costs £100,000, this equates to a tax saving of £24,700 at the current Corporation Tax rate (19%).

Oh, and did we mention that EVs are exempt from paying road tax until at least March 2025?

5. EVs are Proving Cheaper to Acquire and Run

Lastly, research shows that EVs are 49% or £1,306 cheaper than petrol and diesel cars based on average annual running costs. From a fleet perspective, this can save you money!

Sure, EVs require investment in terms of charging points. However, the good news is that you don’t need to purchase these vehicles from cash flow. There are financing solutions available in the form of Hire Purchase and Lease Purchase to help spread the cost.

Furthermore, it may be that you need to consider changes to your infrastructure in order to install charging points, or even potentially move premises. PMD is on hand to help you every step of the way.

Contact PMD today to kickstart the process and find out more about our vehicle finance options that we can tailor to your specific business needs.

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