Consultancy

2035 combustion engine ban: Zenith’s consultation response to support fleet

14 / 08 / 20  |  Consultancy

Zenith submitted its response to the recent consultation on bringing forward the banning of the sale of new petrol, diesel and hybrid cars and vans from 2040 to 2035.

We passionately believe that moving towards a zero emissions future is the right way forward for our customers.

Our response highlights many initiatives and measures that we believe will help government achieve their ambitions. It focuses on three key areas; the scale of change required, barriers to achieving a 2035 goal and solutions to accelerate the uptake of zero emission cars and vans.

In addition to our response, we have collaborated with government departments and worked alongside the BVRLA to support workshops and produce position papers educating on the barriers for fleet and what can be done to overcome them.

The following form Zenith’s recommendations to help government achieve its 2035 ambitions as currently set out and, where possible, accelerate the uptake of zero emission cars and vans within the fleet sector.

Focus on general measures

  1. Continue to engage with fleet operators to understand the challenges they face on a vehicle segment basis
  2. A one-size-fits-all approach should not be applied to all vehicle segments, instead set achievable phase-out dates
  3. The ambition should be to achieve zero emissions; therefore, Zenith calls for the government to focus on incentivising the move to electric and hydrogen solutions
  4. Ensure supply is readily available post-EU exit through alignment with CAFÉ Regulation targets, secure frictionless trade without the 10% WTO tariff on zero-emitting imports, and ensure incentives match those in Europe
  5. Provide joined-up policies aligned to roadmaps for each vehicle segment with measures such as the introduction of Clean Air Zones to match vehicle supply and technology development
  6. Specialist vehicles have unique requirements, therefore it’s important to understand what the future technology looks like in this segment to move to zero emissions. A more joined-up roadmap with HGV is required as the solution will likely involve use of similar technology, for example hydrogen fuel cells. It should be recognised that 2035 looks unachievable for this vehicle segment.

Focus on financial incentives

Long-term tax and purchasing incentives will be required in each segment beyond 2025 to make the total cost of ownership measure up to ICE equivalents for fleets and drivers, these include:

  1. Retention of the plug-in car and van grant until cost parity can be achieved in each segment
  2. Retention of the home and workplace charging grant
  3. 0% BiK for zero-emitting vehicles to be extended for another year
  4. A clear roadmap to retain low BiK rates post-2025 to provide clarity for drivers and fleets when making their purchasing decisions on a typical 4-year replacement cycle
  5. Continuation of 0% van benefit charge for zero-emitting vans
  6. Clarity on future roadmap for taxation in areas such as fuel duty
  7. Extension of 100% first year allowances to leasing companies
  8. VAT incentives for zero emission vehicles to stimulate the retail market and help to achieve cost parity for car and van fleets
  9. Continue to exclude ULEVs from the OpRA legislation

Focus on charging infrastructure investment

Provide a clear and consistent roadmap of investment to develop the charging infrastructure that makes charging an electric vehicle easy and affordable to drivers through:

  1. Reform of the Annual Equivalent Rate (AER) to better account for the cost of business journeys when using the public charging network
  2. Transparent and fair pricing to make costs more visible to drivers and create a fairer pricing basis for public charging, which is prohibitive for some drivers to rely on
  3. Expand the roll out of Project Rapid to towns and cities
  4. Improve ease of accessibility through the creation of a compulsory open network, compatible for all vehicles
  5. Review the process for grid updates to ensure that this is not an unfair barrier for businesses

Next steps

The consultation closed at 11:45pm on 31 July 2020.

We look forward to reading the published consultation outcome and plans for the decarbonisation strategy, due to be announced in the autumn.

For more fleet insights, visit our Insights Hub.

Email oneteam@zenith.co.uk.