Executive Summary
The electrification of company car fleets is significantly lagging behind the private market, with companies continuing to prioritize diesel and gasoline vehicles. This trend has persisted for the third consecutive year, highlighting the urgent need for businesses to accelerate their transition to electric vehicles (EVs) to meet environmental and sustainability goals.
Key Findings
- In 2023, the share of electric company cars in Europe remained at a mere 17%, compared to 22% in the private market.
- Diesel and gasoline vehicles continue to dominate company car fleets, accounting for 68% and 15%, respectively.
- The gap between private and company car electrification rates has widened by 5 percentage points since 2021.
- The transition to EVs is particularly sluggish in large companies with more than 500 employees, where diesel vehicles still make up a significant 72% of the fleet.
Causes of Lagging Electrification
Several factors contribute to the slow pace of company car electrification:
- Fiscal Incentives: Company cars are typically not eligible for the same financial incentives as private EVs, such as tax breaks and purchase subsidies.
- Limited Charging Infrastructure: Inadequate charging infrastructure at company premises and during business trips hinders EV adoption.
- Range Anxiety: Concerns about the range and availability of charging stations during business travel deter companies from transitioning to EVs.
- Cost Considerations: EVs have a higher upfront cost than traditional vehicles, which can be a barrier for companies with limited budgets.
Environmental Impact
The lag in company car electrification has significant environmental implications:
- Carbon Emissions: Diesel and gasoline vehicles contribute heavily to greenhouse gas emissions, exacerbating the climate crisis.
- Air Pollution: Internal combustion engines emit harmful pollutants that degrade air quality and pose health risks.
- Environmental Degradation: The extraction and production of fossil fuels for transportation contribute to environmental degradation and pollution.
Business Case for EV Adoption
Adopting EVs offers several benefits for businesses:
- Cost Savings: EVs have lower operating costs due to reduced fuel and maintenance expenses.
- Sustainability Credentials: Transitioning to EVs enhances a company's environmental credentials and aligns with sustainability goals.
- Employee Satisfaction: Employees increasingly prefer to work for companies that prioritize sustainability and offer EV benefits.
- Reduced Downtime: EVs typically require less maintenance than internal combustion engine vehicles, reducing downtime and improving fleet efficiency.
Recommendations for Acceleration
To accelerate company car electrification, several measures are necessary:
- Policy Changes: Governments should implement policies that incentivize EV adoption for company fleets, including tax breaks and charging infrastructure investments.
- Infrastructure Development: Companies and public authorities should invest in expanding charging infrastructure at workplaces and along major business routes.
- Consumer Education: Educating company decision-makers and employees about the benefits of EVs is crucial to overcome range anxiety and cost concerns.
- Fleet Management Strategies: Companies should develop fleet management strategies that prioritize EV adoption, including lease options and shared mobility programs.
Conclusion
The lagging electrification of company car fleets poses a significant challenge in meeting environmental and sustainability goals. Businesses must urgently accelerate their transition to EVs by addressing barriers to adoption, investing in charging infrastructure, and making a concerted effort to reduce their carbon footprint. By embracing the electrification of company cars, businesses can not only enhance their sustainability credentials but also gain financial and operational benefits while contributing to a cleaner, healthier future.
