As the European Union pushes for a greener future, a potential new law aimed at electrifying vehicle fleets of large companies is under scrutiny. Recent research from Transport & Environment (T&E) reveals that this legislation could account for 57% of the electric vehicle (EV) sales needed by carmakers to meet their 2030 emissions targets. However, for this to happen, the current electrification targets must be raised significantly.
Current Targets and Their Implications
The EU’s current proposal suggests a target of only 45% for member states to electrify new cars registered by large companies. According to T&E, this target could fall short in meeting the potential demand. By increasing the electrification target to 69% and excluding plug-in hybrids, carmakers like BMW, Volkswagen, and Volvo could see a considerable boost in their EV sales—72%, 61%, and 59%, respectively.
Regional Disparities and Market Dynamics
The proposed targets suggest that only six countries—Germany, Italy, Austria, Ireland, Luxembourg, and the Netherlands—would see large companies electrifying faster than the overall car market. In Germany, for instance, the EV registrations of large companies would be only marginally higher than the expected market growth. In the remaining 21 member states, companies would either match or lag behind the general EV market, risking a stagnation in fleet electrification.
Expert Opinions and Recommendations
Sofie Grande y Rodriguez, Clean Fleets Manager at T&E, emphasized the urgency of revising the law: “Designing a fleets law that doesn’t require large companies to lead is like building a house that no one will ever live in. Lawmakers have two options. Either they increase the EV targets and drop PHEVs, or they fail at turning this law into the powerful demand-driving instrument it should be. It’s in the European car industry’s interests that they get this done right.”
Impact of Fiscal Reforms and Manufacturing
Evidence from Belgium shows that EV uptake can be accelerated through fiscal reforms. By changing its fiscal rules in 2021, Belgium boosted EV corporate registrations to 54% by 2025. In contrast, Germany, which did not implement similar tax reforms, saw only 19% EV penetration in the corporate market. Higher fleet targets could also enhance local manufacturing, with 74% of corporate EVs registered in the EU by 2025 already being made in Europe. This figure could rise if only EU-made EVs become eligible for financial support, as proposed.
Grande y Rodriguez further commented: “The EU fleets law is Europe’s secret weapon to turbo charge domestic car production. With made-in-EU EVs already being the favorite choice for corporate buyers when going electric, fleet targets will support European car manufacturers and jobs.”
Additional Information
The EU’s proposal targets large companies that meet at least two of the following criteria: a balance sheet total of €25 million, net turnover of €50 million, or more than 250 employees. These companies represent a mere 0.16% of all EU businesses. The definition of ‘Made-in-EU’ will be detailed in the Industrial Accelerator Act later this month, potentially affecting the financial support for corporate EVs.
Original Story at www.transportenvironment.org