Together In Electric Dreams
Cast your mind back a few years or so and hybrid and electric vehicles were still relatively uncommon, despite Toyota mass producing the Prius hybrid back in 1997.
Despite its success in increasing the profile of the electric vehicle, it’s only in the last five years that hybrids and fully electric vehicles have become more accessible. Battery costs were extortionate when these vehicles first emerged commercially but around 2013 we saw decreases in costs, opening up the market to more consumers.
A recent report from Bloomberg New Energy Finance has estimated that by 2040 electric vehicles dominate the market. It’s predicted that more than 80% of sales of new buses and around 60% of sales of light commercial vehicles will be for electric options by 2040.
With regards to personal vehicles the statistics were slightly lower but still a huge increase, with an estimated 50% of passenger vehicle sales predicted to be electric by 2030. Of course, it will take time to reach these figures but looking back even just two years to 2017, the world’s fleet of electric vehicles grew 54% (around 3.1Million vehicles) from 2016 to 2017.
What is causing the rise?
In line with a growing concern for the environment and the future of the planet if we continue to drain it of its fossil fuel resources, electric vehicles have increased in both popularity and demand.
More and more manufacturers now offer electric or hybrid alternatives and this has seen an increase of high profile companies pledging to make use of these vehicles for their fleets. EVs are not only better for the environment but they can help to save money, with low to zero road tax and zero fuel costs.
This wasn’t always the case, particularly in the motor finance industry. A few years ago, finance companies wouldn’t touch electric vehicles and it was difficult to gain approval for a finance application.
The reason being, at the time this market was new and unknown. No one had experience in financing these kinds of vehicles, there was concern over future residual values and it was difficult to predict if they were financially viable.
Flash-forward 8 years and its now common practice and is increasingly accessible for drivers of all kinds of vehicles, not just personal. Insurance companies have also caught up with the trend, whilst EVs still fall into a higher insurance bracket due to a lack of historical data, there are specialist providers who can offer more tailored policies.
There’s also Government grants available on new electric taxis, vans or cars depending on certain criteria, along with a ‘homecharge’ scheme which provides a contribution towards the installation of charging points at home.
Following originally publishing our blog, we spoke with Neil Cadd of Chadderton Motor Company Limited to gain his insight into the direction of the EV industry;
“The EV world is ever changing with new ideas and technologies emerging on a daily basis. I now work with a manufacturer who specialise in commercial vehicles and are considered market leaders in this field as we are market ready with the latest technology.
I’m not advocating a mass switch to EV’s as they aren’t right for every business nor will they be for many years due to how commercial vehicle operators work, but for those in the last mile delivery sector, local authorities, local tradesmen then yes, they can be the future and can save companies money.
Many customers I visit are curious as to whether it is for them or not and for some it is feasible to change some of their fleet.
Capital cost is the main prohibitor to customers who are changing their vehicles. However, with the right guidance regarding choice of vehicle, the right guidance on funding, and the company themselves having the right mindset then a commercial EV can be the right choice for any business.”
It’s a big change but within the next ten years, electric vehicles are set to overtake traditional vehicles. If you’re considering a new vehicle and want to find out more about electrical options, please don’t hesitate to get in touch an I can introduce you to a trusted supplier and assist with finance requirements.