Electrification and recession – the key fleet issues in 2023

THE impact of recession and electrification look set to be the key fleet issues of 2023 according to the Association of Fleet Professionals.

Chair Paul Hollick said that that businesses will be looking to fleet managers to deliver more value than ever, especially when it came to cost control and carbon savings.

“Next year is going to be a tough one, no question, and there will be considerable pressure on fleet managers to produce results that help their employers make progress on their EV agenda while also controlling costs.

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“Fuel expenditure is going to help drive this line of strategy, alongside environmental concerns. Petrol and diesel prices remain stubbornly high and the impending fuel duty increase will further concentrate minds. Even given that electricity prices could increase in the Spring when the government rethinks its price cap, electrification is going to look more attractive than ever in financial terms.

“Our aim as an organisation is to disseminate as much information about our members’ EV experiences as possible. Currently, several of the largest fleets within the AFP are deploying electric cars and vans in large numbers, and we are sharing their learnings as far and wide as possible through a variety of channels.”

A key challenge given these objectives, Hollick said, was that vehicle supply was likely to remain poor for the whole of 2023, which would inevitably affect the rate of electrification.

“Different manufacturers are making different noises about whether production issues are likely to improve next year but the bottom line remains that there is a massive backlog to clear before the situation has any chance of improving. Electrification can only happen at the rate of supply.

“Of course, this creates a knock-on effect with many company vehicles now being operated well beyond their originally planned termination point, something that will also place considerable demands on fleet managers when it comes to keeping these cars and vans in compliant, roadworthy condition.”

In terms of AFP activity, Hollick said that the organisation would be issuing its new Tax and Legislation Manifesto in early 2023, designed to set out its thinking in these key areas.

He added: “It’s positive that the recent fiscal statement provided much increased certainty over benefit in kind taxation and also that we’ve seen some action over AER but we’d like to keep the dialogue going with government to achieve further improvements in the latter as well as campaigning in a number of related areas. The document is in its final stages of preparation and we plan to issue it soon.”