AAM Group turns to plug-in hybrids
Diesel has been the dominant fleet fuel for around 15 years and it was petrol before that, but the government is investing hundreds of millions of pounds in encouraging businesses and company car drivers to turn to plug-in vehicles.
Recently the 100,000th electric car was registered in the UK - the vast majority having been acquired by the corporate sector - and with plug-in registrations running at around a 4% market share, the UK, perhaps surprisingly, has the largest plug-in car segment in Europe with a 23.8% share across European Union countries, ahead of France and Germany.
The government says: “By 2020, we expect ultra-low emission vehicles to make up to 5% of new UK car registrations. By 2040, our aim is that all new cars sold in this country will have zero tailpipe emissions. And our ultimate goal is to make almost every car and van to be zero emission by 2050 - and will invest £600 million by 2020 to help achieve it.”
That investment comes notably through plug-in grants to help fund the additional acquisition costs of a plug-in car versus internal combustion engine models and funding vehicle recharging points, while the motoring tax system - company car benefit-in-kind tax, Vehicle Excise Duty and capital allowances - is designed to offer financial savings over diesel and petrol models.
Numerous surveys highlight drivers’ concerns over the rise of plug-in vehicles, particularly so-called ‘range anxiety’ - running out of battery charge - and the accessibility of recharging points.
However, Poppy Welch, head of Go Ultra Low, the joint motor manufacturer and government lobby group encouraging the uptake of plug-in vehicles, said: “Year after year, we see record levels of electric vehicle registrations as more and more motorists realise the cost-saving and environmental benefits of driving a plug-in electric car. With ongoing government incentives and increasing product choice we expect this trend to continue.”
She added: “We’ve been encouraged by the growing number of fleets realising the multiple advantages of electric vehicles through education on whole life costs and employee benefits. More businesses need to be bold, opening their thinking to incorporate electric vehicles and the cost savings they bring.”
That’s exactly what AAM Group has done with its own company car fleet - around 60% of vehicles now being plug-in PHEV or hybrids.
Rental services director Mark Thompson is one employee that has chosen a plug-in hybrid as his company car. Like a number of colleagues, he now drives a Mitsubishi Outlander Plug-In Hybrid Electric Vehicle (PHEV), which is the best-selling plug-in hybrid electric vehicle in the UK.
Delivering a 33-mile electric range, the best pure electric vehicle range of any of its competitors, subject to weather conditions, driving style and the usage of the car’s electrical and climate control systems, prices start from £34,249 (excluding £2,500 Plug-In Grant) for the Outlander Kotu auto 4WD.
With CO2 emissions of 41g/km, the model falls in the 9% company car benefit-in-kind tax bracket in 2017/18.
The Outlander PHEV’s official combined cycle fuel economy figure is 166mpg and it is that number which has riled some fleet decision-makers because in real world motoring it is virtually unachievable.
However, the key to plug-in hybrid motoring and maximising fuel savings is to run the vehicle as an electric car for as many miles as possible. Not only does running a car on electricity rather than petrol save money - around 2p a mile to run compared with 12p for a petrol or diesel car, according to the Department for Transport - but drivers save time by not having to stop at a fuel station to refuel. They simply ‘plug-in’ at home and work or at a public recharging point.
Indeed, says Mr Thompson, living with a plug-in car is easy and much easier than most people expect.
He said: “Fuel typically accounts for around 25%-30% of fleet expenditure so any savings that can be made will significantly reduce operating costs. The secret to achieving those fuel savings - although it is not really a secret - is to ensure PHEVs are driven on electricity as frequently as possible and to recharge as regularly as possible.
“Plug-in vehicles are efficient and effective if an employee’s job, lifestyle and regular journey profile maximise the benefits that they offer.”
He added: “AAM Group is committed to promoting plug-in vehicles and believes that for many fleets and company car drivers they offer a viable alternative to both petrol and diesel power. We have introduced hundreds of new drivers to these types of vehicles as one of AAM Group’s key products is providing fleet to independent vehicle rental operators – where take up and acceptance has been excellent.”
The Outlander PHEV was introduced in 2014 and by the end of 2016 a total of 26,600 models had been sold. Lance Bradley, managing director Mitsubishi Motors in the UK, said: “We’re extremely proud of the role the Outlander PHEV has played in building awareness and acceptance of electrically-powered vehicles in the UK and thanks to its unmatched combination of practicality, ease-of-use, elegant styling and low running costs, we are confident of maintaining our market-leading position well into the future.”
As John Pryor, chairman of ACFO, the UK’s premier fleet decision-makers’ organisation, says: “If the total cost of ownership, vehicle range and convenience factors all align there is no reason for fleets and company car drivers not to embrace plug-in cars.”
However, that is not to say that diesel and petrol models will be completely ditched by fleets - or at least not for many years - with Mr Pryor adding: “ACFO believes that ultimately a mix of powerplants - plug-in, petrol and diesel - is the solution for the majority of fleets.”