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A ’pay-as-you-drive’ tax should be introduced for electric vehicles (EVs) to replace lost revenues from fuel duty and VED.

That’s according to a new report, ‘The Future of Driving’, published by the think tank the Centre for Policy Studies.

It recommends that zero emission vehicles (ZEVs) should be charged a flat rate for every mile they drive, with the aim that they would still be paying significantly less than their petrol and diesel counterparts.

Everyone, the report says, would receive a set allocation of tax-free miles every year, with the allocation higher for those living in remote areas with fewer transport alternatives.

Eventually, as the share of ZEVs on the roads grows, this new per mile charging system could completely replace fuel duty and vehicle excise duty for all vehicles.

Each vehicle would be assigned a per mile rate, based on its weight to reflect wear on the roads, and charges would be collected monthly by direct debit.

“Whatever any new taxation system looks like the most important thing is that it’s simple, transparent and fair to drivers,” Nicholas Lyes, RAC

The Centre for Policy Studies says that there are a variety of technological options that could be used to implement such a scheme, ranging from low-tech (submitting your mileage manually) and mid-tech (an on-board device that transmits mileage automatically) to high-tech (GPS tracking).

However, it acknowledges that any system would need to be sensitive to privacy concerns, and let people pick the option they are most comfortable with.

To reflect the public’s concerns about fairness, drivers would receive a ‘free mileage allowance’ based on their postcode.

Drivers in remote areas with limited or non-existent public transport options would receive a higher allowance than big city drivers well-served by trains and buses.

Concessions could also be granted based on disability, low income, and so on – though such measures would involve a clear trade-off with economic efficiency.

In the long run, the report suggests that the Government may wish to combine clean air, congestion and per mile charges into a single nationwide charging scheme.

In the nearer term, however, it argues that it is better to treat congestion and air quality as the local issues that they are, while letting national Government focus on implementing a simple ‘pay as you drive’ per mile charging system for ZEVs.

The report’s co-author and energy and environment researcher at the Centre for Policy Studies, Dillon Smith, said: “Our recommendations take into account public feeling on a variety of proposals, privacy concerns, and their financial impact, and deliver a solution which can lead to fairer, better, and more efficient taxation while tackling congestion and improving air quality in our big cities.”

Tom Clougherty, research director at the think and co-author, believes that the days of motorists being a cash cow for Government are numbered.

“We shouldn’t replicate the old, punitive tax system, but it is still important that all drivers pay a fair amount for the roads they use,” he added.

“The ‘pay-as-you-drive’ approach our report recommends would meet that objective and could be phased in gradually over the next decade or so – alongside targeted, local initiatives to manage congestion and reduce air pollution.”

The report, supported by the Clean Air Fund, also shows that voters remain concerned about air quality and congestion, with significant numbers believing that Government has not done enough to tackle either.

Polling by BMG Research for the think tank shows strong support for action on both, including among 2019 Conservative voters.

However, the focus groups also made clear that local policymakers need to work harder to convince voters that these are targeted measures to improve air quality and congestion rather than purely a revenue raiser.

The report recommends improved communication strategies and hypothecation as ways to achieve this.

Just as drivers would like to see money from road taxes spent on improving the roads, it says that they also back money from clean air zones (CAZs) being used to improve transport or to help people upgrade to cleaner vehicles.

RAC head of roads policy Nicholas Lyes says it is “inevitable” a new tax system will have to be developed.

“Our research suggests drivers broadly support the principle of ‘the more you drive, the more tax you should pay’, with more than a third (36%) saying a ‘pay per mile’ system would be fairer than the current regime – although three-quarters (75%) are concerned the Government might use such a system as a way of increasing the amount they are taxed.”

He concluded: “Whatever any new taxation system looks like the most important thing is that it’s simple, transparent and fair to drivers of both conventional and electric vehicles.

“It’s essential that a new system replaces rather than runs alongside existing taxation regime.

“Ministers should also give serious consideration to ringfencing a sizeable proportion of revenues raised from a new scheme for reinvestment into our road and transport network, not least to finally end the country’s plague of potholes.”  By Graham Hill thanks to Fleet News

Potentially dangerous defects are being missed by garages, according to analysis of the Driver and Vehicle Standards Agency’s (DVSA’s) MOT Compliance Survey 2021-2022.

It has revealed that 10.1% of cars passed by MOT testers should have failed. 

As part of the compliance survey, a team of DVSA expert vehicle examiners retested a randomly selected sample of 1,732 vehicles.

The aim of the annual study is to understand whether correct testing standards are being applied by the industry.

The DVSA disagreed with the test outcomes in 12.2% of cases, with 2.1% of failures deemed to be worthy of a pass certificate.

In nearly two-thirds of the vehicles retested (65.9%), the DVSA found at least one defect which the MOT test station had missed or incorrectly recorded.

Of the 1,142 vehicles with defects disagreed, more than half (51.6%) had three more defects missed or disagreed.

Tyres were the component area with the highest number of defects disagreed, at 734, followed by brakes (660) and suspension (642).

The 1,732 retests also resulted in 27 disciplinary actions recorded and 164 advisory warning letters sent to garages.

A DVSA spokesperson said: “Our MOT Compliance Survey is an essential tool helping us make our roads among the safest in Europe.

“The vast majority of MOT testers carry out testing to the highest standards. Our survey targets a random selection of vehicles and is designed to identify any problems with MOT testing so that we can put them right.

“We are delighted to see that standards have improved since the last report. This underlines the importance of DVSA taking action on the survey results and supporting testers with new digital tools, as well as demonstrating the hard work of MOT testers.”

In separate research, What Car? conducted a survey of 961 car owners, with 13% admitting they are aware of a local garage that is favourable with passing cars through their MOT.

What Car? editor Steve Huntingford said: “Our investigation highlights the differences between official vehicle roadworthiness standards and those upheld by some in the industry.

“With safety critical components such as tyres and brakes at the top of the list of defects missed there are potentially serious road safety concerns at play here.

“It might seem beneficial for owners to have their vehicle inspected by a favourable garage, but the test is there to provide a minimum standard of vehicle safety.”

The Government published proposals to change the MOT in January, including changing the date at which the first MOT for new light vehicles is required from three to four years and improving the monitoring of emissions to tackle pollution.

Ministers claim the changes are necessary because today’s vehicles are built better and are more resilient to wear and tear, particularly with electric vehicles (EVs) having fewer moving parts.

The Government says pushing the requirement for the first MOT back from three years to four would also save money.  By Graham Hill thanks to Fleet News

BP Pulse has announced it will stop selling its electric vehicle (EV) home chargers directly to consumers, instead deciding to focus purely on the fleet market.

It will now concentrate its efforts towards on-the-go, destination and fleet charging, saying it remains “fully committed” to equip the UK with a world-leading network of EV chargers.

This includes plans to increase its rapid and ultra-fast charging network fivefold by 2030, which includes the installation of hundreds of charging hubs.

Akira Kirton, vice president at BP Pulse, said: “BP Pulse is committed to delivering the world-class charging infrastructure the UK needs, but to do so we must ensure we are fully focused on the areas in which we believe we can make the greatest impact.

“By discontinuing our direct-to-consumer offer, we will be able to devote our full attention to providing the best possible EV charging offer for electric vehicle drivers and EV fleets”

The company said it will continue to support consumers who have already purchased BP Pulse home-charging units, including honouring the full, three-year warranty period and completing installations. By Graham Hill thanks to Fleet News

Fuel retailers have increased profit margins, resulting in drivers and fleets having to pay more at the pumps, the Competition and Markets Authority (CMA) has found.

The CMA says that, while the evidence shows that the majority of fuel price increases are due to global factors, such as the Russian invasion of Ukraine, indications are that higher pump prices cannot be attributed solely to factors outside the control of the retailers.

Based on evidence gathered as part of its Road Fuel market study, it has concluded that the higher prices drivers are paying at the pumps appear, in part, to reflect some weakening of competition in the road fuel retail market.

Fuel margins have increased across the retail market, it says, particularly for supermarkets over the past four years.

As a result of these increasing margins, average 2022 supermarket pump prices appear to be around 5 pence per litre (ppl) more expensive than they would have been had their average percentage margins remained at 2019 levels.

Although supermarkets still tend to be the cheapest retail suppliers of fuel, evidence from internal documents indicates that at least one supermarket has significantly increased its internal forward-looking margin targets over this period, according to the CMA.

It did not name the supermarket but added that other supermarkets have recognised this change in approach and may have adjusted their pricing behaviour accordingly.

The CMA is also concerned that it may be seeing evidence of weaker competition in diesel, as compared with petrol, since the beginning of 2023.

RAC fuel spokesman Simon Williams said: “We are very pleased to hear that the Competition and Markets Authority has confirmed what we have been saying for a long time about the biggest retailers taking more margin per litre on fuel than they have in the past.

“Currently, the average price of diesel is more than 20p a litre overpriced simply because they refuse to cut their prices.

“The wholesale price of diesel is actually 4p lower than petrol, yet across the country it is being sold for 9p a litre more – 154.31p compared to 144.95p for unleaded.

“Something badly needs to change to give drivers who depend on their vehicles every day a fair deal at the pumps. We hope even better news will be forthcoming later this summer.”

The CMA says that, while some degree of variation in diesel retail margin is to be expected given the high levels of volatility in diesel wholesale prices, the high margins in 2023 appear to have gone on longer than would be expected.

It said it needed to understand whether weaker competition is part of the explanation for this.

The CMA added: “While the level of engagement with the study has varied across supermarkets, we are not satisfied that they have all been sufficiently forthcoming with the evidence they have provided.

“In particular, important information has only been received late in the day and after several rounds of information gathering.

“Given the concerns we have about a market of such importance to millions of drivers it is vital we get to the bottom of what is going on.”

The CMA will now conduct formal interviews with the supermarkets’ senior management in order to get to the heart of the issues.

Gordon Balmer, executive director of the Petrol Retailers Association, said: “The CMA have made supermarkets the focus of their update, noting only that non-supermarket retailers are traditionally price followers in the market.

“As noted by the CMA, petrol and diesel prices are still volatile due to the ongoing war in Ukraine. The market is very dynamic and independent forecourts are in many cases undercutting supermarkets on price. Our advice to motorists remains to shop around.

“We have cooperated with all of the CMA’s requests for information and will continue to do so as they prepare their final report to be released.”

The CMA will issue its final report no later than July 7, covering the full range of issues it has considered in this market and setting out any further action that we think is needed. By Graham Hill thanks to Fleet News

Stellantis has warned the UK Government that its commitment to build electric vehicles (EVs) in the UK is at risk, unless Brexit trade rules are re-negotiated.

The car maker, which owns 16 car brands, including Vauxhall, said: “If the cost of electric vehicle manufacturing in the UK becomes uncompetitive and unsustainable, operations will close.”

In 2021, Stellantis announced it was investing £100 million in Vauxhall’s Ellesmere Port manufacturing plant to create a new electric vehicle (EV) factory. The plant produces commercial and passenger versions of the Vauxhall and Opel Combo-e, Citroen e-Berlingo and Peugeot e-Partner.

In a submission to a Commons inquiry into EV production, Stellantis outlined that its UK investments were centred on meeting the strict terms of the post-Brexit free trade deal.

Until January 1, 2024, the rules stipulate that at least 40% of the content of EVs and 30% of batteries must originate from the EU or the UK.

From 2024 until January 1, 2027, this increases to 45% of the vehicle and 50-60% of batteries. If this is exceeded, carmakers will have to pay a tariff of 10%.

Stellantis said it was “now unable to meet these rules of origin” as a result of the surge in raw materials costs and energy prices.

As a result, the car maker is calling for the Government to reach a new agreement with the EU to keep the current rules as they are until 2027. It also wants arrangements for manufacturing parts in Serbia and Morocco to be reviewed. By Graham Hill thanks to Fleet News

The price of slow charging an electric vehicle (EV) on the public network increased by 5p/kWh compared to March, while the fast-charging rate rose by 1p/kWh.

The figures, from the April 2023 AA EV Recharge Report, show an increase in slow charging costs by one supplier of EV charging at supermarkets pushed up the average price by 5p/kWh. However, it remains half the average cost of ultra-rapid charging when priced at a flat rate (as opposed to peak/off-peak pricing schemes).

Edmund King, AA president said: “While the increase at some supermarket slow chargers is disappointing, on the whole the cost of charging has remained static and incredibly affordable, especially for the fastest charging speeds.”

AA EV Recharge Report, April 2023 – flat rates

Charge type	Speed	Apr Ave (p/kWh)	Mar Ave (p/kWh)	Difference (p/kWh)	Cost to charge to 80%	Pence per mile (p/mile)
Domestic	Up to 7kW	34	34	0	£13.60	7.64
Slow	Up to 7kW	40	35	5	£16.00	8.99
Fast	8-22kW	54	53	1	£21.60	12.13
Rapid	23-100kW	67	67	0	£26.80	15.06
Ultra-rapid	+101kW	70	70	0	£28.00	15.73

AA EV Recharge Report, April 2023 – peak and off-peak rates

Charge type	Speed	Apr Ave (p/kWh)	Mar Ave (p/kWh)	Difference (p/kWh)	Cost to charge to 80%	Pence per mile (p/mile)
Slow Off-peak	Up to 7kW	37	37	0	£14.80	8.31
Slow Peak	Up to 7kW	72	72	0	£28.80	16.18
Fast Off-peak	8-22kW	57	57	0	£22.80	12.81
Fast Peak	8-22kW	75	75	0	£30.00	16.85
Rapid Off-peak	23-100kW	57	57	0	£22.00	12.81
Rapid Peak	23-100kW	75	75	0	£30.00	16.85
Ultra-rapid Off-peak	+101kW	51	51	0	£20.40	11.46
Ultra-rapid Peak	+101kW	64	64	0	£25.60	14.38

By Graham Hill thanks to Fleet News

A used electric vehicle (EV), with less than 10,000 miles on the clock, can be bought for half the price of a new electric car, according to analysis of used values by the AA.

A Vauxhall e-Corsa, which starts from £33,930 new, could be bought for less than £17,000 with less than 7,000 on the clock and manufactured in 2021 on the AA Cars website.

Likewise, a Hyundai Ioniq Premium, which starts at £43,445 new, could be bought for around £17,500 for a model only one year old.

AA president Edmund King says it is crucial for fleets to lead the way to mainstream electrification as most drivers buy their cars second-hand which depends on a heathy used car market evolving from fleet sales.

However, recent research from Bridgestone and Webfleet suggested that more than three quarters of fleets (76%) are delaying the move to electrification due to cost pressures.

Kind said: “There appears to be some stalling along the road to electrification from three quarters of fleets trying to save on capital costs.

“For some fleets this could backfire as they will miss out on lower running costs whilst being hit with higher repair bills on an aging fleet.

“It will also have a knock-on effect and further delay the uptake of EVs into the mass market.”

He continued: “Used EVs are trading at 47% of their original value, compared to 67.1% for petrol, 65.1% for diesel, 72.8% for hybrids and 62.7% for plug-in hybrids. These comparisons are based on vehicles of 36 months old or 60,000 miles.

“This means there are some bargains out there and it could push those in two minds to make the leap to electric.

“Hybrid values seem to support that, showing popularity among those wanting to keep a foot in both camps.

“Drivers should remember that running costs for an EV are considerably lower, they drive well, are better for the environment and are fun to drive.”

Share of EVs in used market increases

The analysis of used EV prices comes as Indicata reports that the market share of used EVs rose above 3% for the first time as sales slowly increased during April.

It says that used EV sales rise by 0.3% in April driven by a price fall of a further 2.7% in the month. Used EVs have now fallen by 21.2% over the first four months of 2023 (from January 1 to May 1).

Used EV stock levels have moved significantly in 2023 with Market Days’ Supply (MDS) falling from 168 to 65 days.

The MDS metric measures the available stock against sales at the current run rate to determine how many selling days the available stock can cover.

That compares with diesel which became the UK’s fastest-selling powertrain in April with an MDS of just 35.8 days.

Petrol cars meanwhile moved into May with an MDS of 46.4 days and hybrids 52 days.

“The used EV ecosystem seems to be settling down with falling prices translating into demand and sales which is helping keep stock levels in check,” said Jon Mitchell, Indicata’s group sales director.

“What is interesting is the renewed focus on diesel which shows there is still significant demand in a market where fuel efficiency is still a key priority. We saw diesel stock levels fall during April on the back of growing sales,” he added.

There is also evidence of new car supplies starting to improve following a healthy March plate change.

In April, this translated into tactical sales by OEMs and dealers of sub-12-month-old cars increasing sharply.

Overall used car prices rose by 0.1% in April fuelled by strong demand for value and prestige used cars. This was reflected in the fastest-selling used car table, which was topped by the Tesla Model 3, closely followed by the Dacia Duster and the BMW X3.

The VW Golf remained the country’s top-selling used car followed by the Ford Fiesta and Mercedes-Benz A-Class. By Graham Hill thanks to Fleet News

Electric vehicles (EVs) are proving to be a third more efficient than in the coldest months, according to new data from EV payment specialist Mina.

Analysis of more than 350,000 charging events, using over 8 million kWh of electricity, from May 2022 to April 2023, show that late spring, summer and early autumn are the best months for EV batteries.

However, Mina notes that the heatwave in late July and August last year saw a spike in consumption as air con was turned up to full blast.

“Our data, recorded by thousands of electric vehicles, proves for the first time what many anecdotal reports had suggested, EVs operate far better in warm weather,” said Ashley Tate, Mina’s CEO.

Through winter, drivers were still averaging about the same amount of charge per session but, to do the same amount of work and mileage, needed an extra plug-in a week compared to September and October to account for reduced battery efficiency and other potential drains on energy such as heating the cabin.

Tate said: “One of the big questions asked about EVs is: how hard are they hit by winter? Well, now we know for sure. There are many factors involved of course, including temperature, routing, vehicle technology and driving style, but for the first time our data is able to show just what the effect is across thousands of vehicles

“By looking at consumption for each week and applying an average domestic tariff for the period of 30p per kWh, we could then show the cost of this for a typical driver. But of course, the cost could be far higher or lower depending on individual circumstances.

“If a driver has an EV specific tariff and charges exclusively at home at off-peak, the cost could be a third of that quoted, at only around £2.50 a week more. Conversely, if they only charge in public, our data shows it could at least double.”

Month  Average weekly consumption (kWh) Charges per week      Increase/decrease in consumption compared to May 22  Indicative extra weekly spend (30p per kWh) compared to May 22

Month	Average weekly consumption (kWh)	Charges per week	Increase/decrease in consumption compared to May 22	Indicative extra weekly spend (30p per kWh) compared to May 22
May 22	81.6	3.7	–	£24.48
June 22	76.6	3.8	-6.1%	-£1.50
July 22	77.7	3.7	-4.8%	+£1.17
August 22	87.6	4.0	+7.4%	+£1.80
September 22	79.8	3.6	-2.2%	-54p
October 22	78.9	3.6	-3.3%	-81p
November 22	91.7	3.8	+12.3%	+£3.03
December 22	104.9	4.6	+28.5%	+£6.99
January 23	107.5	4.7	+31.7%	+£7.77
February 23	106.8	4.6	+30.8%	+£7.56
March 23	98.6	3.9	+20.8%	+£5.10
April 23	87.7	3.5	+7.5%	+£1.83

Tate explains that it is important to put it into context and remember that the extra winter consumption is only equivalent to two extra tanks of petrol or diesel and that ICE vehicle efficiency can also be hit during winter months as well.

“With electric you have a much wider range of options,” he said. “Because we track hundreds of thousands of home and public charges and their cost, our data shows the cheapest tariffs are only around 10p per kWh at home and 30p per kWh in public.

“So if a driver wants to reduce costs, whatever the season, they need to ensure they are on the lowest possible home tariff, and search out the best value public chargers.”  By Graham Hill thanks to Fleet News

The UK is among the top three European countries considered most ready for the switch away from internal combustion engine (ICE) vehicles to electric, new research suggests.

LeasePlan’s 2023 EV Readiness Index measures the preparedness of 22 European countries for electric vehicles (EVs) based on three factors: the maturity of the EV market, the maturity of EV infrastructure, and the total cost of EV ownership in each country.

The UK remained in the top 3 with an overall score of 36 out of 50, behind Norway and the Netherlands.

Maturity of the EV market increased by 19% (42 points) across Europe – with the UK increasing by 1 point – reflecting the overall improved penetration of EVs in European countries.

However, although EVs are still more affordable in most European countries compared to an ICE alternative, the total cost of ownership (TCO) maturity of EVs has slightly decreased by 6% (14 points). This is mostly driven by rising energy prices in 2022. 

Alfonso Martinez, managing director of LeasePlan UK, said: “It is great to see a significant improvement this year in the UK – we are more ready than ever before for the shift to EV.

“It is now essential that we keep this momentum going: this year’s Index shows drivers in the UK are ready and willing to make the switch to electric, and we must keep pressure on both European and UK Government to ensure a robust public charging infrastructure is available to all drivers – including commercial vehicle fleets, incentives for switching like low Benefit in Kind rates, and OEMs that are able to keep pace with demand.” 

LeasePlan’s report highlights how EVs held a 23% share of the UK’s car market is the highest scoring in terms of Government incentives.

The UK has also significantly improved charging infrastructure compared to the previous year with more than 71,000 public charge locations and over 13,000 fast charge locations per population. The second highest across Europe.

“The continued investment in charge points (including rural areas), electricity prices beginning to fall, and Government’s Budget that announced continued low rates of benefit in kind rates for EVs have all helped ensure electric remains cost comparative with a petrol or diesel equivalent,” continued Martinez. 

“We want every single driver in the UK to be able to go electric, and while this year’s results are promising, we still have work to do.”

By Graham Hill thanks to Fleet News

ATS Euromaster is warning that fleets making the switch to electric vehicles (EVs) need to prepare for a shift in the balance of service, maintenance and repair (SMR) spend.

EVs are expected to cost less to service, thanks in part to fewer moving parts and the absence of requirements such as oil changes, but tyre life expectancy is likely to change compared with traditional internal combustion engine (ICE) fleet vehicles, says ATS.

The tyre and maintenance provider explains that this is down to a number of factors, including the bulk of the cars. The majority are heavy SUVs, which when combined with the weight of a large battery makes them extremely heavy, while regenerative braking may also have a role in shortening the tyre replacement cycle.

However, Mark Holland, operations director at ATS Euromaster, said: “The greatest influence on the wear rate of tyres is the driver.

“With EVs there does seem to be a tendency for drivers new to electric vehicles to make continued use of the exceptional acceleration offered – at least during the initial phase of the driver’s lifecycle with the vehicle.

“The data is very young at the moment and there’s certainly not enough to draw significant conclusions about tyre wear, but driver behaviour appears to be a significant factor.”

In a recent survey conducted by Michelin, nearly 60% of drivers said they enjoyed the accelerative power of EVs and used it at every opportunity where it was safe to do so or did so during the early phase of vehicle ownership before resorting to more moderate levels of acceleration.

Holland continued: “This strongly suggests to us that fleets should prepare for accelerated tyre replacement on EVs, certainly in the first phase of driver use. It seems the novelty of the EV driving experience is having an unexpected effect on tyre wear rates.

“We would also suggest that fleets actively consider driver training before handing over a new EV to a company employee to mitigate these issues, but also as part of a broader duty of care programme.”

Fleet guidance on EVs from ATS Euromaster

• Expect accelerated tyre wear, certainly during the initial phase of driver use
• Consider driver training as part of your fleet’s decarbonisation programme with an introduction to EV technology and the different driving characteristics of EVs compared with ICE vehicles
• Monitor tyre replacement and take preventative driver action if excessive tyre wear continues or explore alternative, EV-specific tyres
• As newer EVs appear on the market, consider moving your fleet away from heavier SUV style models to EVs with less weight, which will not only improve vehicle efficiency but also SMR cost pressures

By Graham Hill thanks to Fleet News