Finding the right business vehicle can seem like an uphill struggle at the best of times – and that’s when you know roughly what you’re dealing with.
Business and fleet buyers are often new to electric and hybrid vehicles, which adds another level of complexity to finding the right option for you. How do you know what will suit you best if you’re not completely sure of what the market offers?
The overall benefits of electric vehicles for businesses are easy enough to get a handle on – they’re greener, cheaper to run and maintain, qualify for some attractive government tax schemes and appeal to an increasingly eco-conscious consumer base.
But, when it comes to getting more granular than that, it can be difficult to know where to start. This article breaks down some of the key considerations for choosing an electric vehicle, so that you can get a clear idea of what’s out there and what would work for you.
- Understanding your requirements for an electric vehicle
- The ‘electric vs hybrid’ question
- Range and charging considerations
- Government finance initiatives and how these might influence your vehicle choice
Know What You Want Your Electric Vehicle to Do Before You Start Looking
This is by far the most important step in finding the right electric vehicle for your business. Skip it at your peril!
This sounds like we’re stating the obvious, but you’d be surprised at how many people dive into business purchases without really knowing what they’re looking for.
What do you need your vehicle to do, on a day-to-day basis?
Do you have a minimum load your vehicle needs to carry, for example? What about an idea of distance covered per day? Or perhaps a percentage cost saving on running and maintaining your current fleet?
Be specific here, and crunch some numbers. Putting in the effort upfront will make it so much easier when comparing types and models of electric vehicle – and it makes it much more likely that you’ll end up with something that works for you.
Aim to go to showrooms and manufacturers, requirements list in-hand. Browsing for the sake of it could be damaging, and makes you that bit more vulnerable to sales spin.
Electric vs Hybrid
What Do I Need to Take Into Account About Vehicle Range?
Ranges on electric vehicles are getting better all the time. Like petrol vehicles, however, the mileage you get out of an electric vehicle will depend on a number of factors, including:
- How efficiently you drive it
- How much weight it is carrying
- How much you use energy-draining features like heating, aircon and radio
The most efficient electric cars can travel 300+ miles on a single charge (the record holder is still the Tesla Model S, whose stated range is around 420 miles).
Plug-in hybrids now come with an all-electric range of around 30-50 miles, whilst standard hybrids come with a lower electric range still. That’s not a bad thing per-se because you have a petrol engine to back it up – but it will affect the emissions the vehicle produces.
If one of your major reasons for going electric is to make your business more eco-friendly, this might be a deal-breaker. Equally, if it’s more about cost efficiency hybrids remain a great option, even if petrol fuelling pushes maintenance costs higher than
Other classes of vehicles don’t quite match this level of efficiency, often because they are heavier to start off with, designed to carry larger loads and haven’t received as much investment as cars over recent years.
This, however, is changing. As investment grows and demand is pushed up, it’s possible the numbers below will increase significantly.
- Vans: up to 120 miles
- Trucks: up to 300 miles (without tow) – additional weight likely to reduce this significantly
- Motorbikes: up to 280 miles
- Mopeds: up to 40 miles
Looking for information about Public Charging Points for your EV?
What About Battery Degradation?
Electric and hybrid vehicle owners often worry about battery degradation. The more you use your battery, the less efficient it becomes, so you end up with a gradually less efficient vehicle as time goes on.
Also, the rate at which electric and hybrid technology is progressing presents a dilemma for many buyers: do you buy now, and miss out on something better down the line? Or do you wait to make the investment but lose out on potential advantages in the immediate term?
A useful answer to this is to look for electric vehicle manufacturers that offer battery leasing. This allows you to lease the battery that runs your vehicle and get an upgrade or replacement after a certain period of time.
…And the Cons?
This isn’t something that’s universally offered. For new models, Renault more or less has the monopoly on battery leasing on new electric vehicles. Some other manufacturers still offer it on older models, but you might need to make compromises on the range.
You will be limited on choice of models, and you may also be limited on mileage too. Some lease agreements are capped at a certain number of miles annually, with fines for overuse. You’ll need to be careful to keep track of things to avoid an unexpected financial hit!
What Government Incentives are there for Electric and Hybrid Vehicles?
Fully electric vehicles are eligible for a grant – the Government subsidises the cost of certain electric vehicles upfront, to make them cheaper at the point of purchase. Electric vehicles currently tend to be slightly more expensive than their petrol counterparts, so this is a useful way of saving a bit of cash when you buy upfront.
A full list of vehicles eligible for the grant can be found on the UK Government website.
You can also get money off the cost of installing chargers for electric vehicles – either at home or at your place of work. This might mean that fully electric vehicles become that bit more workable for your business from an upfront cost perspective.
Alongside these upfront grants, there are lots of other financial incentives designed to encourage business drivers to invest in electric vehicles.
- Capital allowances of 100% for electric vehicles in their first year, allowing you to deduct their cost from pre-tax profits.
- Congestion charge exemptions.
- No road tax for fully electric vehicles. Road tax is based on emissions, so you can also save a relatively significant amount of money by opting for a hybrid.
- Low Benefit in Kind rates for electric and hybrid vehicles.
For a full explanation of the financial benefits on offer for electric and hybrid owners read our guide.
So, how will this affect your choice of business EV?
It’s all about finding that balance between function and finance. Ultimately, if you choose a fully electric car for the financial benefits without considering how it fits your business requirements, you may end up spending more to compensate.
Incentives like the Government grant might also help decide between one vehicle and another. If one is eligible for plugin grants and another isn’t, that might be a useful tipping point for making a decision.
Geography and where your business operates is also worth considering. Avoiding the London Congestion Charge could be a huge cost saving if you operate in and around London – particularly if you have a large fleet of vehicles in operation.