The 2020s look set to be the decade that sees a transport revolution. Production of new diesel vehicles will end; electric and hybrid vehicles will become the norm and by the end of the decade the concept of vehicle ownership will be in serious doubt. The ways we get about, from taxis to trucks, vans to fleets of cars, are going to be transformed. The future of transport is greener – something that Bournemouth has to welcome given its air quality – cheaper and eventually driverless. The future is also going to bring big changes – not least for motor insurance quotes.
In this new blog from Coversure Poole – Poole’s leading independent insurance brokers – we’ll look at some of the changes ahead for taxi drivers, fleet owners and private motorists. We’ll also look at some of the alternative, ‘alternative’ fuels and what the predicted end of vehicle ownership could mean for us all.
Why Are Drivers Going Electric?
Electric vehicles (EVs) aren’t a new idea. The first was tested in 1895 – so pre-dating the internal combustion engine – and until the turn of the 20th century it actually held the vehicular land speed record, though it could be out-paced by Usain Bolt! The reason they didn’t take off then are remarkably similar to today’s issues; limited range, low top speed and the batteries didn’t last. One vehicle did survive and thrive, the trusty milk float which was electrically powered owing to its quietness, its economy and its suitability for urban stop-start journeys, something that’s also reflected in modern electric commercial vehicles.
So why now? Well, three main reasons have been put forward:
• Climate change and pollution – its well-known that cars and other vehicles contribute around 75% of carbon monoxide emissions and 30% of greenhouses gases. In a town like Bournemouth where over 50,000 residents are living with unclear air, this a serious problem
• Costs – the cost of running an electric vehicle is a fraction of that of a fossil fuelled one – around 2p per mile versus 12p. Cost of ownership is also thought to be lower as they are simpler machines and cheaper to repair. Councils up and down the land are also introducing Clean Air Zones (CAZ) which tax polluting vehicles wishing to come into town centres. With costs of up to £22 per day, this has made a lot of drivers – especially commercial vehicle drivers – think twice
• Death of diesels – the VW emissions scandal of 2015 rocked people’s faith in diesels and everyone from private motorists to couriers and taxi drivers began looking for alternatives. Manufacturers, already under pressure from climate change, also moved their electric vehicle efforts up a gear
Whatever the case, electric vehicle sales are soaring in the UK. At the time of writing there have been 72,000 EVs registered in 2019 – a rise of 144% on 2018 – and it’s not just cars; vans, trucks and even farm machinery is being electrified.
Going Green: EV Challenges For Commercial Vehicle Owners
While the tide is definitely turning in favour of electrified vehicles, this isn’t going to be plain sailing for all road users. Commercial vehicle (CV) drivers face particular challenges. For one their vehicle isn’t just a means of getting about, for couriers, hauliers and all manner of tradesmen, their vehicle is essential to their livelihoods. The main challenges are for these types of drivers are:
• Range – the best electric vans currently have a range of around 170 miles on a single charge. Not bad, and if you are an urban courier or tradesman or part of the 70% of van users who, according to Renault, drive less than 62 miles a day, then you’ll be fine. That figure though is skewed by urban and city users. In a rural county like Dorset their mileage is likely to be far higher. Taxi drivers can be on the move pretty much from the moment they start a shift to when they knock off and for them sitting idle while they charge up is money lost
• Cost of vehicles – EVs cost more at present and are likely to do so until they become dominant and the vast sums invested in them is recouped. For example, Renault’s Kangoo Z E 33 price – including the plug-in grant – is £23,232 vs £15,850 for the diesel. For a courier or a tradesman that’s a big jump and while the running costs over time will more than repay the cost, it’s still a lot to fork out
• Lack of fast charging points – this is probably the biggest problem at the moment. Fast charging points are vital to EV adoption and South West currently has the 4th lowest ratio of charging points to vehicles in the UK. The government and local authorities are investing heavily but this will take time
• Lower payloads – there’s a belief that EVs have lower payloads as the batteries are heavy and the engines have less power. In some models this is true, though newer ones have overcome this. The Nissan e-NV200 has the same cargo volume as the standard NV200 diesel, but can actually hold a heavier payload – 770kg vs 730kg
At the end of the day these problems will be overcome. They have to be; manufacturers such as Volvo are already ceasing diesel production and most of the others are staking their future on EVs too. And that’s not all. There’s also the issue of future accessibility and that dreaded acronym, CAZ.
Clean Air Zones and Accessibility
While CV drivers and fleet owners may not relish the idea of changing their vehicles, they may be left with no choice. As breathable air becomes a hotter and hotter political issue so more and more local authorities are looking to set up Clean Air Zones or, in the case of cities like Bristol and Oxford, they are considering banning polluting vehicles completely. This could effectively force fleet, delivery, courier and especially taxi drivers’ hands as without access they have no business. As environmental and health concerns over air quality rise so more and more places will either become too expensive to enter – London’s Ultra Low Emission Zone (ULEZ) will cost a cabbie over £22 a day to enter – or find themselves banned from them.
Electric Taxis: Technology To The Rescue?
At both Coversure Poole and Coversure Weymouth we write a lot of taxi insurance policies. As a result, we have the ear of cabbies and when you mention the idea of going electric, they certainly aren’t against them in principle. What they are very much against, however, is the idea of having to miss fares while they wait for their vehicles to charge. This though may soon be a problem of the past as an innovative technology is being trialled in Nottingham that will allow cabs to charge wirelessly at cab stands. Should this test prove effective it could revolutionise the whole electric vehicle sector and allow everything from vans to fleet vehicles to charge while on the go.
Another clever idea is being used in cities such as Liverpool. Rather than spending millions on installing charging points, the Council is covering lamp posts into charging points. Not only does this cost far less, it also makes use of a piece of street furniture that is idle half the time.
Alternative ‘Alternative’ Vehicle Fuels
So, the future then is electric. Or is it? There other low and zero emission fuels around, the most promising being hydrogen. A lot of industry insiders are getting very excited about hydrogen as a fuel as source as:
• It’s a cheap and abundant fuel
• Engines are generally more efficient than a standard combustion engine
• They produce no emissions as they only emit water vapor and warm air
• Carbon free – hydrogen fuel cells don’t emit carbon emissions that cause pollution – a key benefit going forward, especially for fleet managers who are worried about growing tax rates
• Accessibility – hydrogen is readily available and there is an abundant of the element. While time is needed to break down the compounds the amount of it and ease of it can make up for any time it takes to break it down
• Renewable – hydrogen is a renewable energy source, and just like solar there should be an unlimited amount of energy that won’t run out
Sounds great. So why are we not seeing more news around hydrogen cars? Well there are several drawbacks:
• Cost – currently hydrogen cars would cost more to make and run than other fuel types as the technology is not that advanced or widespread
• Storage – because of the nature of hydrogen it can prove challenging to move and transport compared to oil, which can run through pipes easily
• High-Risk – hydrogen is seen by some as a high-risk option. The fuel cells can be highly flammable and on top of that a hydrogen flame can’t be seen in daylight, making it extremely dangerous to the general public
• Nitrogen Dioxide – while a hydrogen vehicle produces less carbon than other fuel types, it does produce nitrogen dioxide which can be harmful to if inhaled
Car Ownership RIP?
This could be the biggest challenge to hit the motor and motor insurance industries in the next decade. President of Lyft, the ride-hailing service, John Zimmer has said that private car ownership will be dead within 10 years. At first this was dismissed as a self-interested delusion, but other voices have now echoed his sentiments. A Business Insider poll of nearly 1,000 motor industry executives revealed that 60% believed 50% of current car owners would lose interest in ownership by 2025.
In major cities this is probably a fair prediction. Costs of ownership, environmental concerns and the ease of ride sharing have all made the need to own less compelling. But in more rural and more isolated areas – such as Dorset – the need to own a vehicle remains important and it will take a huge investment in both public transport and lift-sharing services – neither of which seem that likely in the coming decade, alas.
The Electric Vehicle Revolution Is Here
Between the demise of diesels, public demands for greater environmental standards, rising costs of fossil fuels – especially for fleet and CV drivers owing to tax – the way forward is electric. How long it will take for the revolution to reach our lovely – but rural – county remains to be seen. It will come thoughj, and it will be for the best for all.
Like Some Local Insurance Help?
If you’d like to know more about how Coversure Poole can help you protect your business, property or vehicles, then please get in touch. You can contact us on (01202) 801 782 or email the Coversure Poole team here