Understanding Electric Van Leasing - The basics for transitioning your fleet

Transitioning your fleet to electric Van Leasing - The basics

The world of electric vehicles often concentrates much of its attention on cars as opposed to the van / commercial vehicle market. Understandably, our passenger vehicle options have been the most relevant and topical of subjects, with company car policies now moving towards the green agenda and even the retail and consumer market moving into the new and used EV market in a considered volume.

You may even notice this week’s headline - “sale of used electric cars soar …” - from media outlets like the  FT   identifying the increasing demand for 2nd hand BEVs in reaction to price adjustments. While described as a “collapse” we are witnessing a price alignment in the used EV industry, as the new vehicles from 2019 and 2020 (many of which are on lease) are returned to finance companies for re-sale at auction and car supermarkets.

With electric cars being purchased, or leased, in higher volumes than vans, this is a good illustration of what to expect moving forwards. And some telling stats (courtesy of Auto Trader) do make for interesting reading:

• In April 2024, the average time for the sale of any EV was 24 days compared to 27 days for a diesel;
•  Nearly 10% of 2nd hand vehicles on Auto Trader are purely electric; and 
•  The average price of a 2 year-old Tesla Model 3 was £25,958 compared to a BMW 4 Series equivalent at £31,663.

The importance of used-EVs cannot be underestimated with the confidence in this market determining the strength of the residual values in the new ones. This applies equally to cars and vans. With the new Labour Government promising to make considerable improvements to our used-EV industry, with standardised certificates, financial incentives and motor insurance policies, the future can be a more positive one.

With used and new cars improving, we are likely to see more enthusiasm for the commercial vehicle market, with van drivers becoming more familiar with this fuel type. Just by way of reference, there were 1,476 pure electric vans registered in June 2024 and some 8,353 registered in 2024 so far. In comparison, June saw 34,034 cars registered and a total of 167,096 registered so far in 2024. So we definitely have a way to go in the UK!

Electric van acquisition - some important Business Tax considerations

The process for moving into a van shouldn’t be too much different than what you consider for a car, with the exception of industry-specific nuances. There are plenty of guides to leasing on our electric van website  but, in summary, you are looking to secure a van on a fixed term contract (2-4 years), based on an annual mileage (5,000-30,000) and with an initial rental / deposit of your choosing.

As an electric vehicle, the mileage must be considered in conjunction with the range of the vehicle. For those high-mileage van drivers, there needs to be a very robust understanding of charging locations, charging times and charging costs before electing to ditch a diesel for the lithium-ion technology.

Many businesses will also need to consider the tax implications of contract hire along with their financial / accounting teams. While we do offer purchase-style finance products, which are treated differently for tax, the vast majority of EVs are provided on a lease as many customers do not want to own it at the end of the contract.

For commercial vehicles you can reclaim 100% of the rental of an electric van against corporation tax and up to 100% of the VAT on any finance rentals (so long as no personal use). In addition, any charge point infrastructure is Full Expensing under Capital Allowances, so you can offset any charging investment.

Fuelling your van at work does not yet incur any fuel benefits (like combustion options). Plus commercial vehicles do still benefit from the plug-in vehicle grants, which formerly applied to cars.

For small vans this means up to £2,500 discount is available so long as the vehicle has a gross weight less than 2,500kg - vans like the Citroen e-Berlingo, Nissan Townstar, Renault Kangoo E-Tech and Vauxhall Combo-e benefit. For large vans, you can enjoy a £5,000 discount so long as the vehicle has a gross weight of between 2,500kg and 4,250kg. Vans like the Citroen e-Relay, Ford E-Transit, Vauxhall Vivaro-e and the VW ID Buzz Cargo would benefit here.

But your search does need to consider other elements of an electric van.

For example:

•  Range - on e-car lease we show real world figures, as opposed to the WLTP factory conditions. This takes into account summer and winter driving, as well as motorway v urban / city driving. Temperature and driving speed will impact your vehicle’s range. As will the load / carrying capacity. For van fleets with more sizeable demands on carriage weights, you need to factor this into the range calculation. Data is still limited here;
•  Charging - each vehicle will have an according AC and DC charging capability. The AC will cover your home and domestic charging, so will often be referenced with a 7 / 11 / 22 kW note. For DC, or rapid charging, this will vary from vehicle to vehicle but often be around 50 - 150kW DC. To be clear, if you are looking to charge on the public network, then understanding your rapid charging capability is key. Your charging session is always limited by 1) the speed of your vehicle; and 2) the speed of the charger you are connected to; and  
•  Charge Point infrastructure - knowing where you will charge is equally fundamental. For those with off-road parking, it makes sense to install a dedicated home charge point. With cost-effective overnight tariffs from many leading electricity companies, this can be a far more advantageous arrangement for fuelling your van. For those without a charge point at home, or work, then apps like Zap Map are fundamental to your experience. This helps you to find a convenient charging solution on your commute or in-between work.

One such fleet we have been assisting to go electric is the Rothwell Group from Wigan, Greater Manchester. The RPS Group offer key services like Renewables, Plumbing, Heating, Mechanical & Electrical and Gas Servicing services. As part of leading a net-zero fleet ambition, the group’s head, Graham Rothwell, has spearheaded an electric car and van transition for his business.

With cars on fleet, like the VW ID4 and BMW iX2, the introduction of the all-electric vans is a pioneering move from the ambitious local company. And the e-car lease team have been proud to support this innovation.

In terms of the van shown, the Volkswagen ID BUZZ Cargo 150KW Commerce 77kwh Auto Commercial Vehicle Pure Electric Vehicle, this is based on the following configuration:

•  Starlight Blue Metallic paint
•  Fabric - Basket seat covers/Titanium Black – Soul
•  18" Black steel wheels with full hubcaps in silver
•  Mode 3 / Type 2 Charging Cable (Public Charging & home wallbox charger – Fast charging)  

But how does the electric VW ID Buzz Cargo perform?

This RWD van will have a 77 kWh usable battery which will offer 0 – 62 times of 10.2 seconds, 90 mph top speeds and 150 kW (or 201hp). Expect a combined winter range of 180 miles with warmer weather allowing for 240 miles BUT this is subject to load and carrying. 

On charging, the 11 kW AC max will allow 8 hour  0 – 100% charging times with the 170 kW DC maximum allowing 28 minute 10 – 80% times. The van is 4,712mm long and 1,985mm wide with a gross vehicle weight of 3,000kg. Load volume for the internal rear is around 3.9 cubic metres. The ID Buzz can tow 750kg (Unbraked) or 1000kg (Braked).

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