Category: Vehicle leasing

It dawned on us a week or so ago at Dorset Car Leasing, after attending an online training session that there is still a great deal of confusion out there about electric cars, so here is a blog which you may find interesting.

Like it or not, we will all be driving electric cars/vehicles in the not too distant future. 2030 is only nine years away now and the Government has made it very clear to manufacturers what they need to do.

An Electric Vehicle (EV) is deemed to be a vehicle that you can charge externally. Here is a brief outline of the most common types currently available:

· Pure electric cars (known as BEV’s – battery electric vehicles) where the battery is the only power source. (An example of these are – Nissan LEAF, BMW i3, Volkswagen ID3, Tesla, Jaguar i-Pace, Polestar 2, etc).

· Plug-in hybrid (known as PHEV’s – plugin hybrid electric vehicles) whereby they have a battery and internal combustion engine (ICE) with a motor and/or engine providing drive. (An example of these are – Mitsubishi Outlander, BMW 330e, Hyundai Ioniq, Volkswagen Golf GTE, Mercedes A250e, etc).

So, what’s the difference in cost to run compared to a conventional car?

Below are average figures to provide a rough idea of the difference in costs based on pence per mile:

· Internal Combustion Engine (ICE) – 16p

· Plug in Hybrid (PHEV) – 11p

· Battery Electric Vehicle (BEV) – 3p

What about charging and how long does it take?

This in one of the questions we get asked the most. Many people are opting to have a home charging unit installed. In our opinion this is a great idea, especially as it is still possible to take advantage of the government grants available. Depending on what type of home charger you go for will determine the cost and how quickly it will charge the car.

For example, a 3.6kW (kilowatt) charger will cost circa £449 (inc VAT and installed) and would fully charge a Volkswagen e-Golf in under 10 hours. A 7kW charger is circa £529 and would charge the same car in under 6 hours. (Please be aware this is just an example and different cars will take different lengths of time to charge).

Some of the fast chargers available at supermarkets, shopping centres and fuel stations could charge an e-Golf to 80% of its capacity within circa 30 minutes. A client of ours who has recently taken delivery of an e-Golf has been charging his car at his local Tesco whilst he does the weekly shopping and has not needed to charge it anywhere else since taking delivery 4 months ago! And the best bit is that there is no charge to do this at Tesco!

Government grants are also available for workplace charging points and a great deal of information (for both private and businesses) can be found here – https://www.gov.uk/government/collections/government-grants-for-low-emission-vehicles

How can I find out where the charging points are in case I need one when I’m out and about?

There are now 6,382 more devices at 4,087 more locations than this time last year and this will continue to grow significantly over the next few years.

One of the best websites for finding out what is near to you or how you can plan a route if you are going on a journey is www.zap-map.com

It is worth taking a look, you’ll probably be surprised what is just around the corner!

So how far will an electric car travel on a full charge?

There is a phrase known as Range Anxiety – ‘the fear that a vehicle has insufficient range to reach its destination leaving the occupants stranded’.

This is by far the discussions we have the most with our clients and in some circumstances can mean the difference between establishing if an EV is the right vehicle to go for or not. One thing is for sure, EV’s travel a lot further now than they did just a few years ago and the rate at which the technology is moving forward is staggering.

Below are examples of some of the ranges achievable from a variety of different manufacturers:

· BMW i3 – 193 miles

· Hyundai Kona 64kWh – 299 miles

· Mercedes EQC – 259 miles

· Nissan LEAF 3.ZERO e+ – 239 miles

· Peugeot e-208 – 217 miles

· Tesla Model 3 (Long Range) – 348 miles

· Vauxhall Corsa-e – 209 miles

· Volkswagen e-Golf – 144 miles

· Volkswagen ID.3 – 205 miles

· Volvo XC40 Recharge – 250 miles

As you can see there is a big variation in the distances covered, but for most people, there is now an EV available which is suitable and worthy of consideration.

Many forget an EV does not need to be fully charged. Many users “top up” the charge to 80% as this is quick and gives them a sensible working daily distance.

To give you an idea of the growth in registrations of EV’s, in 2013 there were 6,000 on our roads, in 2018 this number grew to 195,000 and by 2023 it is predicted there will be over 1 million.

Are electric cars a good idea for company car drivers?

Potentially, yes, very much so.

The government is very keen to get more and more people into zero emission cars as quickly as possible. One way to encourage people is to make EV’s as tax efficient as possible, therefore, from this current tax year, the company car tax payable for a car which has zero emissions is zero. Yes, you have read that correctly, no matter whether you are a lower or higher rate taxpayer, you will not pay any tax for having a company car if it is pure electric! Even if it is a Hybrid car the tax is very low compared to a petrol or diesel engine car.

There is also a great benefit to the employer as there is no Class 1a National Insurance payable either.

You may be thinking the tax payable will go up in the future which is a fair assumption, but, the government has confirmed the tax payable will only rise to 1% (of the cars P11d value) for the next tax year, 2% for the following tax year and will remain unchanged until 2025.

We have clients of ours who have seen this low rate tax as a way of potentially giving their valued employees a pay rise (by replacing their ‘normal’ car) without actually giving them a pay rise as their net income can increase significantly per month.

What about the cost of an EV, I hear they are very expensive?

Most electric cars are still benefitting from the government grant of £3,000 off the list price and many of the EV’s we supply funded via a leasing contract are now significantly better priced than they were a couple of years ago.

You also need to factor in the fuel savings available. You will recall the client of ours I mentioned previously who has been charging his e-Golf at Tesco for free – he used to spend circa £120 per month on fuel! They also do not need to be serviced as often as a conventional car which is therefore another potential saving. Our industry calls it whole life costs, and all these factors are essential to consider before disregarding the EV option.

Many of our clients have been pleasantly surprised by how well priced EV’s are when factoring in all these considerations and the relatively low leasing payments.

Summary

Hopefully, you have learnt a bit more about electric cars having read this blog. Please be aware this has been written to provide a brief overview and there are a lot of considerations before committing to an EV, but we all need to be thinking about it whether we make the change now or in say 5 years time.

We would love to help and would welcome the opportunity to discuss any vehicle procurement requirements you may have.

We have a great deal of experience in this field and have supplied many local companies with EV’s over the past few years having spent a great deal of time ensuring they fully understand how they can work for them both now and in the future.

Even if you are just ‘dipping your toe in the water’ when it comes to EV’s, please feel free to give us a call here at Dorset Car Leasing on 01202 821354 or e-mail hello@dorsetcarleasing.uk