Fleet Electrification is Accelerating – Here are the Four Key Drivers
Words by: Charlie Jardine, Founder & CEO at EO Charging
In the world of electric vehicle (EV) charging, there’s opportunity everywhere. Adoption of battery electric vehicles has sky-rocketed in recent years, a trend that is only accelerating. In 2022, the world is already seeing significant deployment of electric medium-goods vehicles (you’ve probably noticed couriers are rolling out zero-emission fleets) and electric heavy-goods vehicles and buses are set to follow on an even steeper adoption trajectory.
Many of these EVs form part of commercial fleets, owned by global businesses that have committed to ambitious sustainability targets – Amazon has demonstrated a ravenous appetite for electric vans as part of its Climate Pledge targets. EV fleets of all sizes, and the charging products and services they require, represent a particularly robust and immediate segment of the charging market - one that EO has a singular focus on.
So what’s accelerating global fleet electrification and why is 2022 proving to be such a pivotal year in this segment?
01. The carrot-and-the-stick
Governments around the world are driving the electric agenda. Commercial transportation is a huge source of carbon emissions globally, and it’s now widely understood that EVs will play an indispensable role in reducing this footprint. To date, 31 countries, states and cities have already put petrol/diesel vehicle bans in place and in 2020 alone the world saw $14bn in global government incentives for EVs. This global ‘reward and punishment’ strategy is forcing businesses to speed up their timelines for switching to electric – creating a fertile market opportunity for businesses like EO that are dedicated to the unique challenges and demands of fleet electrification.
02. Private sector driving zero emissions
EVs are not only cleaner, but also offer huge operational savings. TCO (total-cost-of-ownership) of commercial EVs is now less than the petrol or diesel equivalents. It comes as no surprise then that over 100 of Climate Group’s EV100 members have committed to transition five million fleet vehicles to electric by 2030. And that’s just the start. There’s 6.3m vehicles in UK fleets today and 15m EVs are expected to be part of corporate fleets in the U.S. by 2040. The private sector has set ambitious zero-emission targets, driven by customer demand and board-level mandates, and is driving the electric agenda every bit as much as governments around the world.
03. Significant availability of electric vehicles
The days of range anxiety, vehicle dependability, and product availability for commercial EVs are fast fading. Manufacturers are now offering a broad selection of models, with over 20 fully electric light commercial vehicle models available in the UK alone. Recent strategic electric pledges from OEMs will translate to between 55 to 72m electric light-duty vehicles cumulatively sold by 2025. Each week we see headlines about fleets of all sizes snapping up electric trucks, vans and buses in the thousands from a growing variety of incumbent and newcomer OEMs. The market has been demanding zero-emission fleet offerings and the manufactures are now responding with scale.
04. Large scale growth in eCommerce & last mile delivery
The global pandemic has only further catalysed the global explosion in ecommerce and the subsequent requirements for last mile delivery. In 2021, estimates suggested that 2.1bn people bought goods online and that 20% of global retail will move online by 2023. The important question - how will all these parcels be delivered? By 2030 it’s expected there will be a 36% increase in last mile vehicles on road, and the total addressable market of delivery vehicles in the U.S. and EU is valued to reach $100bn by 2022. Every metric for ecommerce is expanding rapidly and fleets need a zero-emission and financially efficient vehicle to meet that growth. Then they’ll need a partner to power them.
These are just a few of the tailwinds driving fleet electrification. At EO, we’ve spent seven years building our fleet offering in the UK and Europe, guided by partnerships with some of the world’s largest corporates. We know it takes a dedicated group to understand what EV fleets need, why they need it, and how to deliver it, and have made our name by making the transition to electric as smooth as possible. We are a pure play company that delivers turnkey charging solutions tailored to any size fleet. We have already made significant progress driving electrification in Europe and look forward to replicating that success in North America and further afield.