Addressing EV concerns

While there are many positives to EVs, there are still concerns about batteries, range and repairs. How big a problem are these issues in reality? And what are some of the other blockers?

For many businesses, introducing EVs into their fleet will make sense.

Prices are coming down, running costs are more efficient, and then there’s the positive ESG story to tell to customers, stakeholders and shareholders alike.

However, there are some concerns which, regardless of where you are on the EV spectrum, need to be addressed.

Common risks that lie ahead

One of the most-talked about risks linked to EVs – and consequently one of the talking points broker clients and their teams will likely raise – is surrounding battery fires.

Statistics show that from 2010 to June 2024, there have been 511 verified EV traction battery fires globally,1 and in Australia there have been six EV battery fires from the 120,000 EV vehicles on the road as of 2023 – three of which were due to ignition from a fire nearby. None of the fires occurred when the vehicles were charging. 2

Chris Jones, President of the Australian Electric Vehicle Association, says, “I think our current battery technology is very good. It’s also quite mature in that we know how to make it work. We know how to get the most out of it.

“The battery of an EV is incredibly tough. You would have to have a very serious, life-threatening crash for the battery to be genuinely traumatised. At that point, you’ve got a whole bunch of other problems that are more important than the battery.

“Now the only exception is driving over a very large metal object – there is a genuine risk that the battery will be permanently damaged when that happens. There’s also a very genuine risk that your regular petrol car might be seriously damaged if you did exactly the same thing.

“They put six-millimetre bash plates, solid metal bash plates, underneath the batteries, to ensure that it would have to be a very extraordinarily, exceptional intrusion for a fire to start.”

A different driving experience

Another concern for drivers revolves around a different driving experience, as well as range and charging anxiety.

As far as driving experience goes, however, it’s limited to subtle differences.

“Electric vehicles are as simple and intuitive to drive as petrol and diesel vehicles,” says Samantha Johnson, CEO of the Electric Vehicle Council.

“They are not complicated and do not require specific knowledge other than how to charge, which is very simple. Basic training on charging and owning an EV should be part of any EV handover.”

Matthew Millener, Head of SME and Dealer Commercial at Allianz, agrees, and highlights the need for familiarisation sessions when introducing EVs into a fleet.

“While EVs are very similar to ICE vehicles in terms of driving experience, there are some subtle differences.

“The lack of noise, for example, can take people by surprise, as can the instant torque – while regenerative braking is a different experience to driving an ICE vehicle.”

Chris Wood, Emerging Risks Manager at Allianz, says that according to anecdotal evidence from across the global Allianz Group, EVs are most likely to be in a collision within the first three months of ownership.

“However, it’s often not the primary driver who’s behind the wheel when an event occurs,” explains Wood. “It’s typically someone else from the business who’s not familiar with the vehicle, and they’ve experienced a different reaction to what they’re used to when they’ve put their foot on the accelerator.”

Range and charging anxiety

Range and charging anxiety are very real issues for drivers contemplating an EV purchase – however, a number of studies show that anxiety decreases with ownership.

Johnson says, “Range anxiety and upfront costs are often cited as hurdles to EV adoption, but these concerns are easing as average commutes are well within the range of all EVs available, charging networks have expanded, access to home solar and time-of-use tariffs have improved, and more models at more affordable prices have become available.”

“Electric vehicles are as simple and intuitive to drive as petrol and diesel vehicles.”

The charging infrastructure in Australia continues to grow – there was a 75% increase in charging locations from 2022 to 20233 – and by focusing on those businesses whose fleet does shorter journeys and returns to base every day, those issues can be managed effectively.

One challenge that will need to be addressed is a common one affecting many businesses across the country. Namely, the skills shortage, which is impacting EV repairs.

Jones says, “The difficulty right now is also when it comes to getting a repair done, you might be waiting six months because we’ve got a shortage of skilled workers who can panel beat any vehicle, never mind workers who’ve done the EV depowering and repowering course.”

Millener says that’s a key reason to partner EV clients with insurers who have a reliable repair network.

“Getting vehicles back on the road quickly and safely after an incident is a key part of the insurance value proposition, and by partnering with an insurer with knowledgeable assessors and a reliable, quality repair network, brokers can help clients manage that element of risk.”

In general, there is misinformation circulating about EVs, and Johnson says, “Misinformation is hampering the electric vehicle transition. The facts are that EVs are cheaper to own and run than petrol and diesel vehicles, they reduce air pollution and they’re essential to reducing our carbon emissions.”

1. JUNE 24 EVFS Stats (evfiresafe.com)

2. How many EVs have caught fire in Australia? (youtube.com)

3. EVC-Australian-EV-Industry-Recap-2023.pdf (electricvehiclecouncil.com.au)

EV mythbusting

The Electric Vehicle Council helps us bust some EV myths.

EVs don’t have enough driving range

Today’s EVs have enough battery range to meet the average Australian’s driving needs for over a week.

Background: Current EVs have an average battery range of around 400km but the technology is advancing so rapidly that some new models can drive for over 600km on a single charge.

The average Australian drives 38km per day, so an EV owner can go for at least 10 days without a recharge. Unlike petrol cars, you can recharge at home or anywhere with access to electricity.

EVs are not more environmentally friendly than petrol or diesel-powered cars

When considering the entire lifecycle emissions of making, owning and recycling a car, EVs produce fewer emissions than petrol, diesel or hybrid vehicles.

Background: There are emissions associated with the making of any vehicle. Emissions from building EVs is generally higher than petrol and diesel vehicles, when including the battery. Despite not having a combustion engine and all the other related components, batteries are energy-intensive to produce. These processes continue to improve and these additional emissions are more than offset over the life of the vehicle.

Unlike petrol, diesel or hybrid vehicles, EVs have zero exhaust emissions, and even when charged using the current electricity grid in Australia, produce fewer lifecycle emissions. The emissions from EVs sold today will continue to improve over their lifetime as more renewables are introduced to the electricity grid.

It’s also important to recognise that EV batteries can be used after their useful life in a vehicle (expected to be around 15 years). EV batteries can find a second life powering homes, buildings or even the grid, and are expected to last around another 10 years in these applications. After around 25 years in total, these batteries can then be recycled to create brand-new batteries, moving us closer to a circular economy.

Check out the EVC’s Life Cycle Emissions Calculator Tool to compare emissions from different vehicles.

EVs won’t save people money

In the long run, motorists can save thousands of dollars in fuel and maintenance costs when they own a fully electric vehicle compared with petrol or diesel cars.

Background: Battery EVs don’t need any petrol or diesel but are instead charged with electricity. The average Australian drives around 12,000km per year and spends around $2500 on petrol. This equates to around $0.20/km.

On average, an EV travelling 12,000km each year would cost around $500 to charge ($0.04/km). Further savings can be made by an EV user with access to home solar or off-peak tariffs, which could reduce annual energy costs to as little as $200.

It is important for prospective EV owners to consider their driving habits, government incentives, taxes and charging availability to fully understand the savings of driving an EV compared to a petrol or diesel vehicle.

EVs have lower running costs than petrol, diesel or hybrid vehicles since they have fewer moving parts, and have fewer components that require servicing.

For some EV models, owners are estimated to save between $300-$400 every year in maintenance costs compared to an equivalent combustion engine vehicle.

There isn’t enough charging infrastructure to support EVs in Australia

While most charging generally takes place at home or work, there is still an important need for public charging infrastructure so it’s encouraging to see the national network is rapidly expanding.

Background: Most people do the majority of their charging at home, but access to public EV charging is necessary for most drivers some of the time, and for some drivers all of the time.

Private companies and Local, State and Federal Governments are investing in and co-funding the construction of an expansive charging network right across the country.

The number of high-power charging locations increased from about 800 at the end of 2023 to over 1,000 by mid-year 2024. This represents an increase of 25% in six months and a deployment rate averaging better than one new high-power charging site every day.

Based on continued investment from the public and private sectors, we are confident that the rollout of public charging equipment will keep pace with the uptake of the vehicles and that the EV driver experience of public charging will continue to improve.

To get further insight into where public chargers have already been installed around Australia, take a look at PlugShare.

EVs are not safe

EVs are incredibly safe to operate and charge, with tens of millions of EVs being driven globally.

EV fires are very rare, with global evidence showing that petrol/diesel vehicles are at least 20 times more likely to be involved in a fire.

Background: EVs contain high-quality lithium-ion battery cells and sophisticated battery management systems. Importantly, most EVs have also been awarded five stars under Australia’s ANCAP crash testing program.