New research from Inverto, part of BCG, shows the number of electric freight vehicles (EVs) on UK roads has grown significantly. The number grew to 88,787 in the last year compared to 67,678 in the previous 12 months. * Nevertheless, these vehicles still represent only 1.4% of the total 6.2 million freight vehicles in the UK.
Car manufacturers and logistics companies operating freight vehicles face similar dilemmas. They both need to meet corporate and governmental decarbonisation targets. Curbing Scope 3 emissions is now a requirement in many private and public sector contracts.
Companies that operate freight vehicles are also adopting electric fleets to meet decarbonisation and Scope 3 emissions targets as set out in their commercial contracts. EV adoption ensures that companies can comply with government and decarbonisation Scope 3 targets too.
However, the UK government is indicating that it will lower its EV adoption goals as industries reassess their emissions targets. Such attitudes indicate that EV adoption will remain low.
Kiren Pandya, Principal at Inverto says: “The expansion of the commercial EV sector is expected to continue slowly. The main commercial EV expansion challenge facing logistics firms is the high cost of purchasing or leasing EV freight fleets. High interest rates make it more difficult for fleet operators to finance commercial EVs.”
“Given the higher prices of EV vehicles, the cost of financing has become a key barrier to adoption, despite the growing number of green policy initiatives, such as the pledge to reach net-zero emissions by 2035.”
“There are practical challenges which are slowing the transition. For example, limitations to current battery technology means that there are very few options for switching Heavy Goods Vehicles (HGVs) to electric which is why the number of electric HGVs is just 0.02 % of all HGVs.”
“While many fleet companies are encouraged or even required to transition to commercial EVs as part of their contractual obligations with clients following strong sustainability policies, the broader uptake remains slow.”
* Increase from 68,664 in 2023 to 88,787 in 2024 with year-end December 31.
SOURCE: Inverto
