Cost Concerns Could See UK’s Switch To Electric Vehicles Fail

UK SMEs urge politicians to do more to support switching away from diesel and petrol, new survey shows.

The UK’s drive to switch to electric cars, trucks and vans from 2030 risks failing because of serious cost concerns from the country’s SME business leaders, a new survey has found.

The 861 business YouGov survey was commissioned by Mer – part of Norwegian clean energy giant Statkraft – to assess the readiness and appetite within the SME sector for the switch to EVs.

The role of SMEs in EV adoption

SMEs involvement will be critical to supporting the green transition, given this economic powerhouse accounts for more than 99% of registered businesses in the UK, employing more than 16m people – or around three fifths of the working population (figures here).

With many of those employees travelling to their work in cars – and an additional estimate of some 4-5m vehicles used by SMEs as part of their operations – combined this makes up a large percentage of the UK’s 40+ millions cars and vans.

Yet business leaders quizzed in the survey repeatedly expressed concerns about both the cost of EVs and the cost of installing the charging infrastructure – and that combined these two presented a big barrier to adoption for them.

Leaders also emphatically highlighted the need for bigger tax incentives for those looking to switch to greener motoring, coming at a time when the UK Government recently reduced the new EV tax subsidy while also accelerating the timeline to a ban on the sale of new diesel and petrol vehicles.

Mer UK Managing Director, Anthony Hinde, said: “Although not really surprising, the survey shows the scale of the financial challenge the UK faces if it is to meet its ambitions to ditch diesel and petrol for cleaner electrically charged cars and vans.

“In Norway, where last year almost 70% of new cars bought were EVs, the Government has pushed hard to reduce the costs of ownership through programmes like VAT exemption, purchasing subsidies and free perks, and that has made a huge difference to adoption.” – Anthony Hinde, Mer UK Managing Director

“Equally, they have helped businesses with charging infrastructure costs, financially incentivised housing authorities to install on-street charging points, and committed to fast chargers every 50km on public roads.

“What we are seeing in this survey is that UK SMEs are calling out for similar levels of support to accelerate adoption into smaller businesses around the UK – businesses where the majority of the country’s workforce spend most of their day and where charging points would make a huge difference in countering empty-battery fear.”

The survey asked 861 businesses around the country for their insight into whether EV charging was on their radar, what they perceived as barriers to installing charging facilities, and who they thought was responsible for encouraging adoption.

When asked what would encourage SME business owners to install charging points at their workplace, three cost factors topped the answers. The leading answer was the need for a tax incentive to do so, at 37%, followed by if the installation was cheap, at 35%, and if electric cars were cheaper so more of my employees would use them, at 32%.

Factors encouraging EV installation

Factors	%
If there was a tax incentive to do so	37
If it was cheap and easy to install	35
If electric cars where cheaper and therefore more likely that employees would use them	32
N/A – nothing in particular would encourage me/my business to install EV chargers	29
If the business could create income from them	20
If there was a need for them from my business’ customers	18
If it was part of my business’ sustainability policy	13
If it would make a significant difference to climate change	12
If it would help either attract or retain high quality employees	11
Don’t know	6
Other	3

Data based on 548 SME Decision makers without EV chargers installed at their business premises

Respondents also felt strongly it was the role of both central government and local authorities to encourage EV use, 67% and 45% respectively. Yet those taking part also believed car manufacturers had accountability here – 46% – as well as energy companies.

Who should be responsible for encouraging EV use

N:861 (All SME Decision makers)

But there were positive indicators of change too. Nine percent of SMEs stated they already had EV charging points on their premises – a figure that leapt to 17% for medium sized SMEs (those with 50 – 250 employees). A further 21% (or 30% in medium sized SMEs) were planning to install EV chargers before 2030 – when the Government’s ban on new diesel and petrol vehicle sales comes into force.

Hinde, said: “There are really strong indicators here that SMEs do see the value in installing EV chargers – both for their customers and as ways to attract and retain staff.

“It’s also clear they are going to need – and are asking for – support from Government and local authorities to help with the costs involved in putting in chargers.

But just like in Norway, this is a huge opportunity for politicians to react and take action – cut VAT on new EV cars, up the subsidies, and apply further tax incentives for those working with UK infrastructure – so we can meet the 2030 target and ensure we power more vehicles with less polluting technology.”

Mer recently launched into the UK to support and lead the UK’s transition to EVs, powered by green-generated electricity and with affordable and flexible funding solutions.

Backed by Europe’s largest supplier of renewable energy, and with unrivalled experience building an EV charging network across Norway – the world leaders in EV adoption – Mer is building the EV charging infrastructure the UK will really need for the future – charging points at work, on business premises and in public spaces. Mer has already installed more than 100 chargers into these locations.

Note: All figures, unless otherwise stated, are from YouGov Plc. Total sample size was 861 Senior Decision Makers in SMEs. Fieldwork was undertaken between 22nd – 28th March 2021. The survey was carried out online. The figures have been weighted and are representative of British business size.

About Mer

Mer is a European EV charging company, backed by Statkraft, Europe’s largest renewable energy generator. By bringing together its extensive expertise in renewable energy and electric mobility, Mer is on a mission to make EV charging simple, sustainable, and accessible to everyone. In the UK, Mer delivers complete EV charging solutions to businesses and local authorities, helping power the shift to purer transportation across Europe.