Over the past few years we have seen a number of major changes that have impacted fleets and their drivers, from the introduction of a new system of Vehicle Excise Duty (VED) to the rise of electric vehicles (EVs). And there’s a lot more to come, including the introduction of a new system of Company Car Tax (CCT) and the proliferation of Clean Air Zones (CAZs) around the country.
For fleets to thrive in this shifting landscape, fleet professionals need to be prepared.
Change 1: Legislation
Most forthcoming government legislation is designed to encourage the uptake of cleaner vehicles. CAZs are a case in point. These have their basis in the Government’s Air Quality Plan from 2017, which identified 29 local authorities where nitrogen dioxide (NO2) levels are particularly bad – and ordered them to draw up their own clean air plans by the end of 2018. Another 33 local authorities have since been added to the list.
The local authorities’ plans can involve CAZs, which are defined as areas where special action will be taken to reduce emissions from road transport. There are, broadly speaking, two types of CAZ. A non-charging CAZ is one where there are no fees for most motorists, but instead a number of other schemes to improve air quality – such as cycling routes and improved road layouts. Charging CAZs, by contrast, impose fees on dirtier vehicles that travel through them.
London’s Ultra Low Emission Zone (ULEZ) is an example of a charging CAZ. As for other local authorities, they are mostly still finalising their plans. Some will introduce charging CAZs, some will introduce non-charging-CAZs – but, whatever form they eventually take, it’s likely that the majority of CAZs won’t be introduced until 2020 or 2021.
Around the same time, another policy will be introduced to encourage the uptake of cleaner vehicles. From April 2020, a new set of lower CCT bands is being introduced for vehicles that emit less than 50g CO2/km, and their rates will be determined by the number of zero-emission miles that they can travel. For example, a car that emits 25g CO2/km and that can travel 100 miles without any emissions will face a rate of just 5% and pure EVs will face a 0% rate.
The Government also published the outcome of its consultation on ‘reduced VED rates for the cleanest vans’ – and proposed a new system that also ties rates to CO2 emissions in the first year. The Government has promised to confirm the particulars of that new system ‘ahead of April 2021’.
Change 2: Emissions tests
There are other factors that will encourage cleaner motoring – including the introduction of new emissions tests. These are the Worldwide Harmonised Light Vehicle Test Procedure (WLTP) and the Real Driving Emissions (RDE) tests, which are both replacing the old New European Driving Cycle (NEDC).
What’s so special about these new tests? Fundamentally, they are designed to be more akin to real-world driving – and therefore more accurate.
RDE measures a car’s emissions on the road – particularly oxides of nitrogen (NOx). To conform with the RDE Step 1 standard, which is obligatory for all newly registered cars from 1 September 2019, a car can emit up to 168mg NOx/km. The equivalent figure for the RDE 2 standard, obligatory for all newly registered cars from 1 January 2021, is 120mg NOx/km.
More accurate tests mean more accurate results – which, in turn, has ramifications for fleets and their drivers. Various taxes, including CCT and VED are tied to a vehicle’s CO2 emissions. Given that WLTP is likely to give higher CO2 scores than would have been given under NEDC, it’s possible that some vehicles will be pushed into higher tax brackets and that some derivatives will disappear altogether.
Change 3: Technology
EVs have been on the rise for several years now – 141,000 were registered in 2018, which is 300% higher than the total from five years before. This is partly a reflection of how much more practical they have become. Thanks to the innovations of manufacturers, there is now a greater variety of different EVs, and most recent models can travel well over 200 miles on a single charge. This situation is only going to improve in the years ahead.
Other technological innovations are coming, too. For example, more cars are now ‘connected’ either to the Internet, through mobile networks, or to other cars and roadside infrastructure, through what is known as ‘Dedicated Short-Range Communications’ (DSRC). This level of connectivity promises to revolutionise motoring, not least by reducing both congestion and accidents – as well as laying the groundwork for autonomous vehicles.
Change 4: Infrastructure
Thankfully, the charging infrastructure is growing to accommodate the rise of electric vehicles. There are now over 15,000 public charge points around the UK’s road network.
The number of rapid charge points – which can bring some EVs to 80% charge in about 30 to 60 minutes – is also growing. There are now almost 2,500 around the country and almost every motorway service station now has at least one rapid charge point.
And more are on the way. Last year, the Government passed its Automated and Electric Vehicles Act, which gives it greater powers to make service stations and other fuel retailers provide more public charge points. It has also established a £400 million Charging Infrastructure Investment Fund to help develop the necessary infrastructure around the country.
What you can do
With so many changes happening, companies need to be flexible. This means frequently reviewing your fleet mobility policy – and then optimising it for the latest legislative and technological developments.
Speak to the experts
The ALD Automotive Consultancy Team
We specialise in designing efficient and cost effective responses to the changing fleet environment. We empower you to understand and optimise the transition of your fleet to a mobility based model. Using our collective insight and expertise, we can support you with the integration of Alternatively Fuelled Vehicles and other smart mobility solutions.