Fleets

Corporate fleets are low-hanging fruit in the decarbonisation of road transport.

60%of new cars sold in Europe

71%of new car emissions

Why fleets matter

Company fleets account for over half of new cars sold every year and, as they are driven more than private cars, are responsible for 71% of new-car emissions.

To achieve a zero emissions road transport system by 2050, all new cars, vans, smaller trucks and buses must be zero-emission no later than 2035. Today, six out of 10 cars sold in Europe are company cars, and 76% of those new registrations were still petrol and diesel vehicles in 2020. The rapid electrification of company cars will therefore be key to meet the 2035 target.

Because fleets contribute disproportionately to road transport emissions and can be targeted with just a few simple measures, electrification of fleets represents the ‘low hanging fruit’ for governments and the EU alike in their efforts to decarbonise transport.

Prioritising fleet electrification will secure the biggest and fastest overall impact in CO2 reduction in the sector. The EU should set a clear roadmap that targets fleet electrification of 100% in 2030. Certain member states who already have mature EV markets should set the earlier targets.

Affordable zero-emission cars in the second-hand market

Crucially for the wider transition to electric cars, corporate vehicles enter the used car market quicker than private ones (typically after 3-5 years), so a continuous influx of relatively new and cheap zero-emission vehicles will be available to private buyers on the second-hand market thanks to corporate fleet electrification. Accelerating electrification of fleets means much faster and affordable penetration of zero-emission cars into the wider European car stock.

According to T&E calculations, the second-hand market will have 1.2 million EVs that come from the corporate channel by 2025 and 6.6 million by 2030, thus providing affordable EVs in almost-new condition for used car buyers. This is when a huge shift is expected in the private market, as the average “Jane and Joe” in Europe buys second-hand cars, not new ones.

Accelerating fleet electrification

Electrification of fleets can be achieved in part through national taxation reforms, but also by steering companies towards zero-emission fleets at the EU level, boosting EU-wide demand, strengthening investments and scaling up zero-emission vehicles production in the EU.

The corporate car market’s transition to zero-emission vehicles already makes economic sense and the shift will be profitable from a total cost of ownership perspective for fleets in Europe. Companies have a role to play in the transition by electrifying corporate fleets and should use the opportunity to lead the change. In fact, many companies have already committed to electrifying 100% of their fleets by 2030 as part of their broader sustainability strategies.

Europe must take the lead in achieving zero emissions mobility and honouring the commitments under the European Green Deal strategy, which includes a target of reducing transport-related greenhouse gas emissions by 90% by 2050.

To get emissions from the transport sector on a clear downward trend, the European Commission presented its Sustainable and Smart Mobility Strategy in 2020 and confirmed it will “propose actions to boost the uptake of zero-emission vehicles in corporate and urban fleets”. Since then, it has come forward with a public consultation on the Greening of Fleets Initiative to tackle the problem whole heartedly. Therefore, setting an ambitious roadmap at EU level in its upcoming Initiative to accelerate the shift to zero-emission fleets in companies with large fleets (of over 100 cars), targeting 100% in 2030, will provide clarity to focus the efforts of all stakeholders to achieve these goals.

Charging infrastructure needs

While setting goals through policy and regulation can accelerate the pace of fleet electrification, EVs also need a reliable and ubiquitous charging network. In 2023, 530,000 public charge points are operational across Europe and the Alternative Fuel Infrastructure Regulation obliges member states to continue the deployment of charging infrastructure in line with the EVs registered in their territory.

Charging infrastructure is the key to accelerate fleet electrification. Deployment of on-street public infrastructure should be prioritised, together with city charging hubs including high-power charging stations, making charging simpler for taxis and private-hire vehicles. But a new “right to plug” legislation should also be implemented, so the permission of building owners in advance of installing charging points is not needed and overnight slow charging at home is also quickly and easily made available.

Harmonised, future-proof infrastructure is necessary to recharge the dozens of millions of EVs due to hit the roads this decade and finally curb the increasing trend in road transport emissions.