Is the car industry putting the brakes on the corporate rollout of EVs?

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Is the car industry putting the brakes on the corporate rollout of EVs?

Growing corporate requirement for electrical vehicles indicates that the UK could phase-out fresh fossil fuel automobiles however, EV100 members fear that the limited distribution of EVs could delay the shift

Huge company requirement for electrical vehicles is obviously to put at least 2.5 million battery automobiles and rising on the streets by 2030, but concern is growing among companies that the supply of EVs from carmakers is lagging behind demand and might put the brakes on the shift to greener road transportation.

That is the warning contained in an analysis now by EV100, the effort that has seen growing numbers of major companies pledge.

Possessing first launched in 2017, the amount of EV100 associates has now more doubled over the past year from 31 to 67 firms across 80 markets, including five brand new joiners declared now: Lloyds Banking Group, Zenith, Schneider Electric, Lime, and also Danfoss Group.

Together these firms’ commitments amount to 2.5 million EVs driving on the world’s roads by 2030, even before consumer demand is considered, and that number is expected to rise rapidly as more firms shift their fleets to run on battery power in the coming years, according to The Climate Group, which runs the EV100 campaign.

The millions of EVs set to be rolled out by EV100 members over the next decade is expected to save 42 million tonnes of CO2 – the equivalent to 11 coal-fired power plants – compared to running petrol and diesel engines, The Climate Group estimates.

Its analysis demonstrates how corporates are helping to drive the growing global battery vehicle market around the world, with EV100 members deploying approximately 80,000 EVs on the roads to date, in addition to installing 10,000 charging points.

A growing band of corporates have recongised that not only are zero emission fleets critical to the credibility of their emissions reduction strategies, but that they can also slash fuel and running costs, open up new smart grid-related revenue streams, and minimise the risk of reputational damage and litigation associated with air pollution.

However, the latest survey of EV100 members points to both growing demand for EVs as well as rising concern over the potential roadblocks to further uptake. Almost 80 per cent of firms highlighted slower than anticipated production of EVs from automotive industry as the top barrier to switching their entire fleet to electric, a figure which is up by more than a third since the last survey a year ago.

As many as 23 new battery EV models are expected to hit the UK market in 2020, alongside 10 plug-in hybrid models and a new hydrogen fuel cell electric car, but European automakers are still set to release many more petrol and diesel models in the coming years. Meanwhile, for all the rapid growth, EV sales still made up only around two per cent of the European car market in 2018 – a situation compounded by the fact many of the most popular EV models boast waiting lists of between six and 12 months.

Helen Clarkson, CEO of The Climate Group, said the auto industry was failing to respond fast enough to the rapidly growing corporate demand for EV fleets.

“For many years automakers have raised the lack of need as a problem for moving quicker on electric vehicles,” said Clarkson. “If automakers wish to stay competitive, they have to shift into a higher equipment on producing EVs – or risk losing their biggest clients.”

Carmakers are under increasing pressure to boost their EV manufacturing pipelines amid both consumer and political pressure for more environmentally-friendly road transport. On Tuesday the UK government announced its intention to bring forward the phase-out date for fossil fuel car sales from 2040 to 2035 – or potentially even sooner – and hinted the ban would include hybrid vehicles. A consultation is now due in the coming weeks.

Meanwhile, EU emissions standards are incentivising manufacturers to deliver more low and zero emission models or risk massive fines, sparking speculation that a price war for plugin hybrid models could be in the offing.

However, the car sector has pushed back against the 2035 phase out target, with chief executive of industry body SMMT, Mike Hawes, criticising the government for having”seemingly moved the goalposts for customers and industry on such a critical issue”, and pointing out the expense of investment in developing EVs.

Green groups on the other hand argue 2035 is not nearly ambitious enough to realise the UK’s 2050 net zero greenhouse gas emissions goal, and that the fossil fuel car ban should instead be brought forward even sooner to 2030, arguing an accelerated shift to zero emissions models would deliver net economic and environmental gains.

For their part, most auto manufacturers have said they are committed to the EV transition, but warn that it will take some time to mobilise the multi-billion dollar investments needed to design new models and retool production lines. At the same time they complain that chopping and changing to incentive schemes and tax breaks, as well as a failure to scale of charging infrastructure quickly enough, are all hampering demand.

But investors and businesses are increasingly turning to electrified vehicles, envisaging a major shift to greener cars in the coming years that could come quicker than expected. Craig Bonthron, investment manager for global equities at Kames Capital, argued this week that the widespread adoption of EVs was”vastly underappreciated by most customers and automakers at the stage”, forecasting that sales of combustion engine vehicles would amount to”less than five percent” of total car sales in 2035.

“Disruption on this scale consistently appears absurd in foresight and apparent in hindsight in this scenario, there’s also a push and draw from social pressure and administration regulation,” he said. “The ICE [internal combustion motor ] motor sector will face a growing crisis over the next decade, like the coal sector previously. This can be an inevitable use of tumultuous change and it’s essential in the environmental context, therefore there’s absolutely no point seeking to slow or prevent it”

The Climate Group, meanwhile, also believes rapidly growing demand from EV100 members for plug-in vehicles indicates the UK government should look to set a more ambitious fossil fuel car phase out date of 2030, as this is the direction the market is heading.

“It’s amazing that the government has attracted the phase-out date for gasoline and diesel vehicles forward to 2035, but together with companies accelerating the roll-out of EVs, a 2030 commitment are the goal,” said Clarkson.

Yet for all of the potential disruption forward for major automakers facing the insurrection of both Tesla and companies demanding battery-powered vehicles, these carmakers that do not quickly shift their funding and attention towards EVs couldn’t just harm their own company, but slow down the wider shift to low carbon transfer.

On the other hand, significant corporates’ buying capacity is enormous, and the business opportunity for carmakers that measure up to meet the expanding EV demand from such companies that are challenging is definitely on. To get corporates at least, fossil fuel automobiles may be running out of street.

Article Source and Credit businessgreen.com https://www.businessgreen.com/news-analysis/4010166/car-industry-putting-brakes-corporate-rollout-evs Buy Tickets for every event – Sports, Concerts, Festivals and more buytickets.com

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