Corporations are lagging behind in the transition to electric cars

Companies in Europe that are ideally positioned to switch to electric vehicles are lagging behind private consumers for the third year in a row, according to a new report by the NGO Transport & Environment (T&E). Euractiv.

The analysis comes out at a time when the Commission is launching a public consultation on the greening of corporate fleets.

According to the report, six out of ten new car registrations in the EU are official.

Corporate car buyers, mainly leasing companies, could play a big role in the transition to net zero, given their continued fleet growth, their higher purchasing power compared to private buyers and generous tax breaks for company cars .

Instead, in 2023, European companies had a lower take-up of zero-emission vehicles (ZEVs) than private consumers (14,1% vs. 15,6%) for the third consecutive year. This applies strongly to the largest markets in Europe - France and Germany, while the picture is more mixed in other countries.

The report found that corporate fleets are the biggest source of emissions produced by new cars, as they register twice as many new large SUVs as private buyers and drive twice as many kilometers per year.

The problem with hybrids

In addition, T&E found that companies are registering more hybrids, which they describe as "fake electric cars". The commission found that hybrids emit 3,5 times more greenhouse gas emissions than officially declared, because in real life consumers are more likely to use the hybrid's gasoline engine.

The lower use of corporate ZEVs is seen as a missed opportunity to support EU carmakers in their transition to electrification, as companies prefer European car brands.

The report's findings are particularly relevant in the ongoing public consultation on the greening of corporate parks. Based on this discussion, the European Commission is expected to propose a new EU regulation.

T&E believes that any new regulation should include binding ZEV targets for large fleets (100 vehicles or more) and leasing companies.

"The industry already has a well-defined path to the -100% CO2 target in 2035. We therefore need to carefully consider the balance between any proposal for additional mandatory targets and an enabling environment," the European Automobile Manufacturers Association (ACEA) announced.

In addition, ACEA highlighted the need for charging stations and fiscal incentives to switch to electric vehicles:

"We need to see around 22 public charging points installed per week to meet the 000% CO2 reduction target for cars and vans by 55."

The industry body concluded that regulators should prioritize driving EV demand over mandatory targets.