6 minute read
Taking the High Road
David McEwen, Head of Business Development at Agnew Leasing, talks to Ambition about how the Whole Life Costs of integrating electric vehicles into traditional diesel and petrol fleets far outweigh any reason for hesitancy and one of NI’s biggest employers is a testament to this.
Construction giant GRAHAM, whose 300-vehicle fleet is managed by Agnew Leasing has begun the process of integrating EVs into its fleet in a move that is set to be emulated by the rest of the corporate world in the coming years. It is a decision that will serve GRAHAM well in terms of supporting its sustainability goals, reducing costs and offering its employees more economical travel solutions.
“More and more larger businesses are looking at either integrating or entirely changing their fleets over to EVs and we are advising them on the cost structure and practicality,” says Agnew’s Head of Business Development, David McEwen.
“Most businesses are seeking to increase that sustainability element of their business and we are able to advise them on that by measuring the true costs of transferring to EVs.”
He says the company uses a marketleading fleet analysis software suite from Deloitte. This software enables Agnew Leasing to build bespoke solutions taking account of both the specific requirements of the company and its drivers, whatever the situation.
The software also facilitates the ability to utilise a financial model known as Whole Life Cost (WLC) – a term given to the overall cost for your fleet vehicles over the term of leasing or ownership. Meaning critical factors such as tax relief, Class 1 NIC, fuel reimbursement and benefit in kind are fully accounted for.
“The benefit of tax reduction to drivers choosing an EV is obvious with potentially significant monthly cost reductions, particularly for higher rate taxpayers,” says David.
He adds the key to making that fleet transition easier is to see beyond the headline monthly lease rental rates and, instead, focus on those WLCs for fleet cost savings.
“Previously many companies used either the purchase price or monthly rental cost as the central criteria when acquiring vehicles. However, when considering the other costs of running a fleet such as tax relief, servicing, maintenance, fuel spend, etc., the monthly costs may not fully reflect the true costs over the lifetime of the vehicle.”
And this is the kind of information Agnew Leasing can divulge for any make or model currently available.
There are three main types of electric vehicles in the market. They are classed by the extent that electricity is used as the energy source: BEVs, or battery electric vehicles, PHEVs or plug-in hybrid electric vehicles, and HEVs, or hybrid electric vehicles. All three vehicle types are available at Agnew Leasing.
David continues: “Sustainability reporting for businesses is already a critical factor for most businesses and integrating EVs into your fleet can significantly enhance your sustainability efforts.”
The number of available electrical vehicles has been increasing significantly in recent years across all car manufacturers. UK law will ban the sale of new full diesel and petrol vehicles in 2030 and onwards – a deadline that is undoubtedly further fast-tracking the improvement and availability of electric vehicles.
Typically, most electrical vehicles now have a range of 180–350 miles “and that average has increased and will continue to as time goes on,” David advises.
“This means that for many businesses and drivers previous range anxiety concerns have been reduced or removed.”
He says: “There may well be some drivers whose requirements mean EVs are precluded; however, we will still be able to recommend what improvements you can make and how they will impact your fleet, depending on your activity and driving trends.
“We’re finding, in some cases, new working patterns since Covid-19 have had an impact on reduced mileage and in some respects, make the adoption of electric vehicles easier.
“The big point here is helping businesses and staff members fully understand the benefit of switching to electric vehicles. We see this as more of an evolution over time rather than a revolution.
“If a company is introducing BEVs into their car selection policy it is important that employees are part of that journey and they’re fully informed. Most drivers will quickly understand the benefit in terms of tax savings and we can also provide FAQ documents or even demo days working closely with the HR team in the business.”
One employer that has been early to adopt the integration of BEVs is GRAHAM.
Jonathan Hall, Director at GRAHAM, said: “At GRAHAM we have always maintained a keen focus on costs and Agnew Leasing has continued to assist
Lianne Taylor, Head of Environment at GRAHAM and David McEwen Head of Business Development at Agnew Leasing.
us with the process since becoming our chosen fleet management company.
“They have introduced us to the principle of properly calculated whole life costs which have in turn allowed us to have a consistent approach to our vehicle procurement. It also facilitated the integration of electric vehicles into our fleet which is a key element in our overall group sustainability agenda.”
In addition, Lianne Taylor, Head of Environment at GRAHAM, said: “As a leading contractor, at GRAHAM we are fully cognisant of the climate crisis and our obligation to act. We are prioritising the elimination of fossil fuel use across our business and earlier this year adopted an ultra-low emission policy for our company cars. Consequently, only fully electric or plug-in hybrid models are available to eligible GRAHAM employees across all company car band categories. The new car policy, which has been well received by colleagues, is positively reducing the carbon associated with our staff travel and marks another milestone on our journey towards achieving net zero (scope 1&2) by 2030.”
Asked if charging infrastructure is a concern for the promotion of converting fleets for other businesses, David says steps are being taken using both public and private spending to ramp up the network. He is hopeful.
“Clearly this is a justified area of concern and most will agree that our charging network isn’t where it needs to be but we are expecting inward investment in the infrastructure to lead to significant improvements over the next two to three years.
“In the meantime, home charging will continue to form an essential element in any BEV fleet solution and is a relatively easy fix. The typical cost of that would be around £700–£900, which drivers would recoup in benefit in kind savings in a matter of months.”
An EV Taskforce set up last year by the Department for Infrastructure is addressing the charging deficit here. And it has begun to show signs of motion.
The aim of the Taskforce is to work with the Department for Infrastructure’s Transport Working Group to develop an EV Infrastructure Action Plan to help deliver a fit-for-purpose, modern EV charging network.
A number of local companies are also planning significant investments in the charging network where we could see at least 1,500 new public electric vehicle charging points across Northern Ireland. At least 350 locations are expected to be live by the end of 2024, inducing six ultra-rapid charging hub sites with 20-minute charge times.
Elsewhere, major forecourt retailers are ensuring their outlets are fully equipped to cater to the steady move to EVs. Maxol, for example, will launch three new local forecourts of the future within the next two years, it has said. Among those are sites on Crumlin Road, Derry and Downpatrick with another four to five locations earmarked.
“Our customers are happy that they’ve made the move,” David continues. “It’s clearly an ongoing process and our role is to help you and your staff understand the true costs and benefits.”
