Mercia Fleet Management says “adapting” to electric vehicles (EVs) via subscription could help introduce an element of control as fleets face increasing costs.

Most companies facing an increase in employers’ national insurance contributions (NIC) and the minimum living wage from next Aprilas well as an increase in vehicle excise duty (VED)he says the need to keep tight control over operating costs is paramount.

For fleet operators, VED is expected to increase in several areas, including more expensive hybrids and electric vehicles.

For example, new electric vehicles with a list price above £40,000 will, from April 1, 2025, have to pay the costly car surcharge of £390 per year from the second tax payment.

One way to mitigate the effect of increases and exercise greater control over costs could be to flexibly introduce electric vehicles on subscription rather than long-term rentals, particularly for businesses with needs seasonal or contractual, explains Mercia, the fleet management division of Fleet Evolution.

By researching customers in the professional services and construction sectors, the study found that in many cases company cars were often deployed on only three-month contracts to meet short-term needs. term or seasonal and were often not necessary in the longer term.

Andrew Leech, head of Mercia Fleet Management and founder of Fleet Evolution, said: “For clients with short-term seasonal requirements or new hires on probation, we have been able to reduce costs by up to 40% by implementing a period of three months. subscriptions for electric vehicles.

“This means the MG4, our most popular electric vehicle, could cost as little as £25 a day, while the subscription-based Tesla Y could cost as little as £40 a day including insurance.

“We firmly believe that subscriptions should be considered as an important part of a fleet strategy, particularly to provide greater flexibility, at a time when the Budget has raised the cost thresholds for most businesses in the UK. United. »

He added: “The ability to ‘flex’ a fleet based on demand is vital in today’s market for the many businesses facing increased costs following the Budget. And these will become even more expensive due to initiatives such as increasing VED on new products.

Mercia recently launched an electric vehicle subscription service, Subscribe Electric, to give business customers a taste of electric at affordable prices while meeting short-term business needs.

Leech concluded: “We are increasingly talking to companies who want to find ways to reduce costs, especially after what most consider to be a poor Budget for business. »