Electric vehicles for business: Is it time to make the switch?
In the UK, US and across Europe, electric vehicles (EV) being used by companies are big business. Some experts in the industry think that the number of drivers making the switch to an EV could be the biggest thing to happen on roads since more people started choosing automatic over manual transmission. The use of EVs by businesses is starting to gain popularity here in Australia as well, and for good reason.
EVs for commercial purposes don’t just make sense for the environmental benefits – EVs could have a range of other benefits for your business too.
Electric cars could have benefits for your business
If you have a company car, or a fleet of them, making the switch to an EV might not be as far into the future as you imagine. The technology is improving, the number of models and designs available is growing and public charging infrastructure is expanding.
Here's why EVs could be better for your business.
You could reduce fuel costs
While buying an EV for your business could cost more upfront than an internal combustion engine (ICE) vehicles of around the same size, your fuel costs could be reduced. It’s estimated that the average fuel consumption cost of an ICE vehicle is $2,400 per year, compared to an estimated average cost of $400 per year to charge an EV battery.*
The amount you could potentially save on fuel costs will depend on your choice of EV, your driving habits, the cost of fuel and electricity and a range of other factors. In general, if you choose a PHEV or hybrid EV you’ll still need to use some fuel, however as the amount of fuel used is less, these costs are likely to be much less. However, if you choose to switch to a completely electric vehicle, your business could say goodbye to the fuel pump forever.
If your business vehicle or fleet cars tend to regularly travel the same routes, you could consider scheduling when and where your EVs will charge to make the most of their driving range and seek to have further control over your charging costs.
Commercial electric vehicles could help you prepare for uncertainty
Here in Australia, we rely heavily on international imports for our liquid fuels such as petrol and diesel. If you switch to an EV for your business, you can instead rely on electricity generated in Australia, which could include electricity generated by renewable sources.
If you have a commercial solar PV system at your business premises, you could try to make the most of any excess electricity generated by your solar PV system by using it to help charge your business' EVs.
By planning EV charging times to maximise the use of excess solar power generated during the day, you could help your business take more control of its electricity costs and also improve the stability of the energy system. This can be particularly helpful in turbulent times for your business or around the world.
You could potentially save on vehicle maintenance costs
EVs need to meet the equivalent safety standards as conventional ICE vehicles. This means that while you won't avoid maintenance costs altogether, your maintenance costs for an EV could be much lower. Less moving parts in the engine (compared to an ICE) will generally mean less wear and tear, and with an EV you don’t need to worry oil changes.
You could reduce your business' carbon footprint
In Australia, the transport sector accounts for approximately 19% of Australia’s carbon emissions, 60% of which are attributed to passenger and light commercial vehicles.
If you’re serious about corporate environmental responsibility, choosing commercial electric vehicles for your business could be your next step in reducing your business' carbon footprint.
Different types of EVs have different features and benefits but making the switch to an EV from an ICE vehicle is very likely to reduce your overall greenhouse gas emissions (all other things remaining equal), especially if you charge your EV using electricity generated from renewable energy sources. This has obvious environmental benefits but could also benefit your brand, showing your customers and potential customers that your business is actively trying to reduce its impact on the environment.
Across the world, more than 85% of the global car market has vehicle fuel efficiency standards – and here in Australia we’re set to catch up. As part of the National Electric Vehicle strategy, the Australian Government proposes to implement a national light vehicle Fuel Efficiency Standard. This is aimed at improving the supply and different types of EVs available in the Australian market and help to address the contribution of inefficient vehicles to cost-of-living pressures.
Meeting fuel efficiency standards is generally a strong driver for more fuel-efficient vehicles to be supplied by manufacturers and purchased by consumers, including EVs. This is now an increasing priority for businesses in locations with similar fuel standards in place, including the European Union, the US, UK, China, Japan, Brazil, India, Canada, South Korea, New Zealand and Mexico.
Reduced noise pollution is another potential benefit of choosing EVs for business. EVs are generally much quieter than ICE vehicles – which could have benefit your customers, neighbouring businesses or homes, your team and the wider community.
Your business could have access to government incentives
Here in WA, the State Government announced a $60 million Clean Energy Car Fund in 2022, as part of an overall electric vehicle strategy. This includes $36.5 million for $3,500 rebates on the purchase of electric and hydrogen vehicles which your business may be eligible for.^
The rebates will be available for a total of 10,000 eligible EVs valued up to $70,000, sold in WA from 10 May 2022.^
The Clean Energy Car Fund also includes $15 million worth of business grants for the installation of EV charging infrastructure are also being offered to local governments, not-for-profit organisations and small-to-medium businesses to cover up to 50% of costs.~ Your business could be eligible for a charging grant it installs EV charging infrastructure at its business premises.~
Step into the future of electric cars for business
If you like to work with the latest in technology and sit at the cutting edge of your industry, switching to an EV could be a cost-effective and exciting way to move your business into the future. With car manufacturers offering more types of plug-in hybrid or fully electric vehicles, there’s no doubt the future of the EV is bright.
By choosing electric cars for your business, you could enjoy the benefits of joining a community of EV drivers.
Is it time to consider the switch to an EV?
Every business decision maker needs to consider major purchases, including electric cars, carefully. Here are some of the common obstacles which can prevent a business making the switch to an EV – and how you might address these:
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Range anxiety
Worrying about how far an EV could get between charges was once a major barrier to making the switch, but this is not the concern it used to be. Many new electric cars can drive for up to 550 kilometres on a single charge. -
EV charging stations
This could be a deterrent if you need to travel long distances on a regular basis as part of your business operations – but WA’s EV charging infrastructure is expanding. The WA Government is investing $22.6 million to increase EV charging infrastructure across the State, with the WA EV Network adding almost 100 charging stations across 49 locations. Additionally there are hundreds of charging stations available to the public across Perth and WA in car parks, shopping centres and other locations. -
The upfront cost
The high cost of electric cars compared to the same size ICE vehicles can be a concern for many businesses. It’s important to do your research and weigh up the fuel costs, maintenance costs and running costs to determine the cost benefits you might enjoy with an EV. -
The suitability of EVs for different industries
For lighter industry sectors such as retail, hospitality, health and education, it may be easier to make the switch to an EV. For heavy industry including construction, the number of EV options is much more limited. Car manufacturers are working on expanding the heavy industry options, so this could be resolved in the future with a wider application of EV technology.
Making the switch to an EV is something which could be well worth investigating for your business. If you’re looking for other ways you could potentially reduce business costs, taking control of your business energy management could be a good option for you too. By taking steps to reduce your energy use, you could find potential savings on your electricity costs, which could give you more freedom to invest in technology such as electric cars for business use.
If you would like to learn more about what to consider when shopping for EVs for your business, we’ve put together some key questions and answers to help you make an informed decision about buying an EV.
* Cost sourced from article published by Drive.com.au available at https://www.drive.com.au/caradvice/how-much-does-it-cost-to-charge-an-electric-car-in-australia/ as at 23 March 2023. The cost to charge at a public EV charging station are subject to change can vary between providers, charger types and locations. Pricing information may not be current. Check EV charging station provider websites prior to use for current pricing information.
^ The Zero Emission Vehicle (ZEV) Rebate Scheme is a financial incentive to encourage the purchase of zero emission vehicles as part of the State Government's Clean Energy Car Fund. Zero emission vehicles are vehicles powered solely by batteries or hydrogen fuel cells that do not emit greenhouse gases. Hybrid vehicles (including plug-in hybrids) emit greenhouse gases are therefore not eligible. Other eligibility criteria may apply. For more information visit Zero Emission Vehicle (ZEV) Rebate (transport.wa.gov.au).
~ Eligibility criteria may apply. Energy Policy WA is developing the governance framework and guidelines for the grant scheme for government approval. For more information contact Energy Policy WA (www.wa.gov.au).
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