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“Leasing providers must make it as easy as possible to choose electric cars”

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Last year, China was once again the market leader in the sale of electric cars. What is holding back growth in the electric car market in most European countries? Professor Joeri Van Mierlo (VUB) explains how we can speed up the transition to sustainable mobility in Europe.

In 2018, more than a million new electric cars were sold in China, while in Europe the figure was just 302,000, according to data from consultancy group Transport & Environment. If we want a carbon neutral Europe by 2050, all new cars sold from 2035 must be electric. What is needed to achieve this objective? And what can leasing companies do? We asked Joeri Van Mierlo, Professor of Electromobility at the Vrije Universiteit Brussel (VUB) and co-founder of the multidisciplinary research group MOBI, which focuses on electric cars, batteries, sustainable logistics and urban mobility.

Favourable policy

How has China managed to become the market leader in electric cars?

Joeri Van Mierlo: “If you look at the statistics from three years ago, China did not even feature. But in the last couple of years the country has got fully behind a policy of promoting electric cars, quickly making them account for half of total car sales.”

“Not only are citizens encouraged to buy electric cars, but car manufacturers are stimulated to produce electric models. In China, those who want to apply for a number plate for a car that runs on fossil fuel end up on a very long waiting list. By contrast, ‘green number plates’ for electric cars are much easier to get hold of. Furthermore, new car manufacturers who set up shop in China must produce at least one electric model.”

What is holding back growth in the electric car market in many European countries?

“The car market is strongly determined by the fiscal climate that the government creates. So there are European countries that are doing well, such as Norway, where electric cars account for 50 per cent of new car sales. This is because for a long time now there has been a high sales tax on diesel cars sold in Norway, while electric cars are tax-free. As a result, electric cars are much cheaper than cars that run on fossil fuels. In Belgium, sales of electric cars are much lower, as there are limited tax incentives.”

More choice and capacity

How can car manufacturers stimulate the transition to electric cars?

“Car manufacturers must work on different models. Today, many carmakers only sell one electric model, and that is not always the model that customers need. Some customers want a hatchback, while others want a family car or a luxury model. People like to have options, so if there is an electric alternative in each segment of the market, more people will take the step towards buying electric cars.”

“Furthermore, car manufacturers must increase the production capacity for electric cars. In Norway there is already an extremely long waiting list for those who want an electric car. If we want to extend that success story to the whole of Europe, we must be able to produce more electric vehicles quickly.”

Can leasing providers such as Athlon boost the sales of electric cars?

“Definitely. Leasing providers must make it as easy as possible to choose electric cars. At the moment, many Belgian employees do not know how the charging systems work, where they could charge their electric car, and how far they could drive such a car. As a result there is a fear of the unknown. An additional service that clarifies all these issues would make the transition to electric cars much easier.”

“Leasing providers must also respond to the needs and concerns of their customers. A few years ago, a fully charged electric car had a range of barely 150 kilometres—enough for local trips, but not for longer journeys. For example, leasing providers could offer a formula in which company car drivers can use car with a traditional engine for long journeys. Happily we are also seeing more and more electric cars on the market with a range of 400 kilometres. So in the future, longer journeys should no longer present a problem.”

Storing energy

Do you see a future for other alternative car fuels in Europe?

“That depends on what we want to achieve. For mobility in urban areas, natural gas vehicles are a good alternative, for example, because they have a limited impact on air quality. Unfortunately they do not help in the battle against climate change. Though they do emit slightly less CO2, they produce damaging methane gas, which is twenty times worse for the climate than CO2.”

“Looking at the full picture, what is most interesting is electric cars in combination with renewable energy. There is still a challenge in storing the green electricity, but I believe that it is actually electric cars that can offer a solution. If we plugged our cars and their batteries into the grid, they would not only be charged with green electricity at smart times, but could also put electricity back into the grid when the electricity price is high. In this way we could use electric cars as storage capacity, which would make the energy transition easier to achieve. But for all this to happen, policy changes must be made.”

How does Athlon stimulate electric mobility?

Athlon has initiatives on three levels:

1. People

Ludovic De Borle, Product Manager: “With complementary services such as charging infrastructure at home and in the office, and a simple payment system when on the road, Athlon removes the worries of both employers and employees in the transition to an electric fleet. By devising customised car policies, Athlon ensures that its customers can make simple agreements with their staff. If a fleet manager does not have any experience with electric company cars, Athlon provides suitable guidance.”

2. Planet

Ludovic De Borle: “Athlon has a focus on sustainability at many levels. The company's premises in Belgium are integrated in a green landscape and internally there are testing grounds around electric mobility. Moreover, in the future, Athlon Belgium will further electrify its rental car fleet (short term leasing).”

3. Profit

Ludovic De Borle: “As part of its 360-degree service provision, Athlon calculates the total cost of ownership (TCO). Therefore customers do not need to worry about the complex tax regulations for company cars. Based on correct cost comparisons, electric cars often work out as the best investments over a three- to five-year period.”

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