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PHEV and EV adoption fleet take-up stalls on infrastructure and cost

Optima Hybrid saloon
Greener future: Kia Optima PHEV saloon

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30 November 2017

Kia fleet survey key points

  • Two in three fleet managers admit their organisation is nervous about purchasing a petrol/diesel car without an electric powertrain
  • One in two not convinced by current charging infrastructure
  • Seven in ten believe full-autonomous vehicles will result in fewer accidents – costing fleet less

INCREASINGLY fleet managers see the requirement for electrification of their fleet, but are holding off thanks to nervousness about charging infrastructure and cost.

That’s one of the key findings from the latest Kia 2017 Fleet Market Attitudes report, undertaken in November with 150 fleet managers.

Despite the lack of immediate take-up of PHEV and EV vehicles, the Kia 2017 Fleet Market Attitudes report says that by 2022, one in three cars on fleet will have PHEV/EV capabilities, and by 2027 this will increase to one in every two cars.

The reasons holding them back are:

  • PHEVs/EVs look unprofessional (41%)
  • Charging infrastructure a barrier (35%)
  • Too expensive (27%)

Perhaps more importantly for leasing companies is that one in five (20%) felt that they lacked sufficient understanding of the technology, showing the requirement for more information across the industry.

Of the fleet managers with PHEVs and EVs on fleet, the reasons given for their inclusion were:

  • Good for the environment (67%),
  • Cheaper in the long run (67%) – at odds with those fleet managers without PHEV/EVs on fleet because they are seen as too expensive
  • Good local charging infrastructure (58%)
  • More attractive than regular cars (43%) – contrast that with those who thought they looked unprofessional
  • Employee demand (41%)

What about fleet attitudes to autonomy and technology?

While many fleet managers felt uneasy about new-tech drivetrains, according to the Kia 2017 Fleet Market Attitudes report, that’s not such the case with autonomous or semi-autonomous technology.

Kia 2017 Fleet Market Attitudes report
Plug-in Optima

The average percentage of organisations where ‘assisted driving’ vehicles feature is 23%. This was anticipated to increase to 51% by 2027. Similarly, the average percentage of organisations where ‘semi-autonomous driving’ vehicles feature is 19% per cent, increasing to an average of 51% in 10 years’ time.

For fully-autonomous vehicles, the majority of fleet managers (93%) see barriers facing this type of driving, such as:

  • Identifying who is liable in the case of an insurance claim (56%)
  • The cost in updating roads and motorways so that they are compatible (47%)

Perhaps a bigger problem, though, lies in changes to company culture – with employees expected to work longer hours while commuting (76%).

Nevertheless, fleet managers can already see the benefits of fully-autonomous vehicles with fewer accidents on the road – potentially saving fleet costs and increasing road user safety – and cheaper maintenance costs.

Changes to policy driving vehicle choice

With the main threshold for business car capital allowances to be reduced to 110 g/km from April 2018 (as will the leasing tax break), over three-quarters (77%) of respondents say will change fleet policy in 2018 to take this into account.

Currently, the average CO2 levels of organisations’ fleets is 118g/km, with only 27% being less than 110g/km. However, a similar proportion state the average to be over 130g/km, while three in 10 (30%) admit they don’t know – suggesting that emissions tax bands remain a concern, but are not necessarily a ‘deal-breaker’ for those who wish to acquire cars above the threshold.

John Hargreaves, head of fleet and remarketing at Kia, commented on the 2017 Fleet Market Attitudes report, saying:

“As more and more organisations embrace new technologies for the vehicles in their fleets – from EVs/PHEVs to ‘assisted driving’ and ‘semi-automated driving’, traditional powertrains are becoming less likely to be considered the default option in fleet purchasing decisions.

“Organisations that can address and overcome the concerns they have with fully-autonomous driving technology stand to benefit greatly from its adoption.”

 

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