The Growth of Electric Vehicles
Over the past decade, the global electric vehicle (EV) market has seen huge growth, but some predict we are only just seeing the start. Despite the effects of the Covid-19 pandemic in 2020, which saw an overall decrease in new car registrations in the UK and elsewhere, sales of new EV and Plug-in Hybrid Electric Vehicles (PHEV) bucked the trend in the UK at least. New registrations of EVs grew by 185.9%, the majority of which were company cars. This indicates that more still needs to be done to encourage private ownership but shows that EVs have become more attractive through company schemes.
The two main factors motivating drivers to switch to EVs are the reduced emissions and reduced total cost of ownership.
An EV produces zero emissions from the vehicle itself which helps reduce harmful pollution in our towns and cities. It is often argued that EVs are only as clean to run as the energy grid that supplies their electricity; however, studies have shown that on average, electric cars emit significantly less greenhouse gases over their lifetime than internal combustion engine vehicles, even when they are powered by the most carbon intensive energy. With the increasing use of renewable sources, such as wind and solar added to the mix, we can look forward to EVs becoming cleaner over time, even as the vehicles themselves age.
The purchase price of many new EVs remains prohibitively high when compared to equivalent petrol or diesel vehicles. Prices are however coming down and the increased range of EV options available includes more affordable options. For a true comparison, it is important to look not only at the purchase price but at the total cost of ownership. The savings that can be made in fuel costs alone can be significant, and electricity prices can be more predictable than oil which can make budgeting easier. Another factor to consider is the maintenance costs of EVs compared with petrol vehicles. EVs have fewer moving parts; this means there are fewer components to become worn, break and need replacing. Beyond this, other benefits of EVs can include reduced road tax, cheaper off-peak electricity tariffs and potential tax relief. Once all of these factors have been taken into consideration, the initial purchase price of an electric car no longer seems so off-putting.
The EV Industry
The established car manufacturers have made a real push to ramp up production of their EV model ranges. This is possibly in a bid to distance themselves from the emissions scandals of recent years or to prepare themselves for bans of the sale of new petrol and diesel cars which we may see as early as 2025 in Norway and 2030 in the UK. Up to this point, it has felt like the legacy manufacturers have been making half-hearted attempts to catch up with the technology and innovation of the likes of Tesla, but the past couple of years have seen a real explosion in the models available and those in the pipeline too. Currently, there are more than 130 different EV or PHEV models available in the UK market; from small city cars to large SUVs, giving us some real choice for those considering an EV as their next car.
Capital International Group’s Electric Vehicle Scheme
Following a comprehensive carbon audit earlier this year, it came to light that the most significant contributor to Capital International Group’s total greenhouse gas emissions is the commute to and from work. Often, companies do not take the daily travel of their staff into consideration when quantifying their carbon footprint, but with the aim of making a genuine impact through it’s Conscious Capital initiatives, the Group has taken the bold decision to include the commute in its footprint calculation and strive to minimise the emissions it creates. To this end, the Group has implemented an EV leasing scheme which is available to all employees based in the Isle of Man. The EV leasing scheme includes full electric vehicles (EV & PHEV) but hybrid vehicles cannot be leased through the scheme. There are currently only around 400 electric vehicles on the Isle of Man and with over 160 staff based across the company’s Douglas and Castletown offices, there is potential for the scheme to make a significant contribution to reducing the Island’s emissions.