Almost three fifths of commercial finance brokers (58%) expect demand for electric vehicles (EVs) to increase over the next three years, with almost a third (30%) believing this demand will increase ‘significantly’.
According to new research1 commissioned by Cambridge & Counties Bank among brokers looking into sentiment towards EVs, the vehicles expected to see the highest demand are electric taxis (cited by 65%), company cars (63%), and Light Commercial Vehicles (57%). Three fifths (59%) expect to see strong demand for electric fleets.
In addition, nearly all (97%) believe the UK Government’s recent announcement that cars and vans powered wholly by petrol or diesel will not be allowed to be sold in the UK from 2030 will have a positive impact on uptake by businesses over the next 12 months.
The research by Cambridge & Counties Bank comes in the wake of surging demand and use of EVs by UK households and businesses. Along with the Government’s 2030 target, a 0% Benefit in Kind (BiK) rate relief on EVs introduced in April 2020 is also expected to boost usage among UK firms.
To support UK businesses and SMEs to transition to EVs, Cambridge & Counties Bank now includes pure electric vehicles (as opposed to hybrids) as part of its highly competitive green lending strategy and product suite. The bank has rolled out a dedicated campaign to support this initiative: for UK businesses looking to move to pure EVs, this includes no document fees, deferred VAT payments, and payments deferred for the first three months.
The biggest drivers for demand, according to the bank’s research among brokers, are financial incentives such as government legislation (71%), EVs becoming cheaper to run (60%), and more attractive pricing (48%).
Almost all the brokers surveyed (96%) said they were aware that EVs in the UK became eligible for a 0% BiK rate relief as of 6th April 2020, with 46% having already seen an increase in demand from businesses to take advantage of it. Most (93%) believe that the introduction of the BiK rate will have a positive impact on the uptake of EVs, with 21% expecting it to have a ‘significantly’ positive impact.
Separately, the research by Cambridge & Counties Bank also found that the majority of SME business owners (94%) believe UK businesses that use vehicles and wheeled assets have a responsibility to change them to EVs as soon as possible, with almost half (46%) believing this should be a priority.
Chris Brown, Managing Director at Electric Broker & Ethos Asset Finance said:
“We have seen increased interest from SMEs for dedicated finance for electric vehicles and fully expect this to accelerate as EVs become the vehicle of choice for businesses both from a costs point of view and also in terms of corporate best practice. There is a real need for competitive finance to service this demand.”
1 Research among 100 commercial finance brokers conducted by PureProfile in December 2020
Simon Hilyer, Senior Business Development Manager at Cambridge & Counties Bank, said:
“Our research has clearly shown that finance brokers are acutely aware of the importance that electric vehicles will increasingly have for their clients, and Cambridge & Counties Bank is very well positioned to cater for this demand.
“UK businesses will be core stakeholders in the rapid switch to EVs over the next decade, particularly as costs come down and EVs become more efficient. SMEs and businesses are also likely to see EVs as part of a wider move towards better corporate responsibility – which for many will also be a key competitive differentiator. Through our dedicated lending products and recognition of EVs as a new asset class, we are here to help UK businesses, and the brokers that support them, to capitalise on this shift in the most cost effective and straightforward way.”