Demand for New Electric Vans Faltering
Like the retail market for new electric cars, demand for new electric vans by individuals and small businesses has contracted since fuel prices hit their peak last summer. At the start of April, only 6.0% of all new vans looked at on Auto Trader were pure electric, down from 8.8% in the year prior. Even worse, only 1.9% of all new van inquiries sent to retailers were about the zero-emission fuel type. This sharp decline in interest comes at a time when stock availability has risen significantly, with electric vans accounting for 14.6% of all new vans advertised on Auto Trader. There’s no sign of demand improving in the near-term, with only one in three in-market van buyers saying they would consider an EV, down from 54% at the start of 2022. The question is: what’s stopping them from making the switch?
Range Anxiety: The Biggest Barrier for Van Buyers
The largest barrier to entry for van buyers is battery range, with half (49%) of respondents saying they are worried about it. Despite greater choice and availability in the market, this barrier hasn’t diminished over time (Auto Trader on-site survey between 1 Feb – 1 Mar 2023: 2,815 respondents).
Analysis of the technical specifications of a sample of vans reveals that electric variants cannot travel as far as diesel variants on a single charge or tank of fuel. Even the electric vans with the longest battery range cannot cover half the distance of the most fuel-efficient diesel vans. For example, the Ford Transit Custom Travel can travel up to 690 miles on a single tank of diesel, whereas the E-Transit Trend can only travel 158 miles on a single charge.
With the battery range currently unable to meet the needs of many high-mileage van owners, electric van buyers may have to rely on public charging infrastructure. However, as highlighted earlier in the report, this can quickly eliminate any savings on running costs.
Price Gap Persists Despite Increased Availability
The number of new electric van models available to buy in the UK has risen rapidly over recent years. At the start of 2020, there were 6 electric and 40 diesel models on sale by manufacturers. Now, there are 31 electric models, only seven fewer than diesel. At this rate of growth, the number of electric van models is set to overtake the number of diesel models in the next year. However, manufacturers will need to focus on producing a variety of body types to maintain the existing level of choice, as 32 of the 38 electric models are panel-based.
Another barrier stopping van buyers from making the switch to electric is price, with more than one in three thinking that electric options are more expensive than petrol or diesel equivalents. Based on the recommended retail prices of the new vans on offer, electric vans are, on average, 46% more expensive than their diesel equivalents on a like-for-like basis. Worryingly, this trend hasn’t improved since 2020. This green premium means that buyers looking for a new van under £30k will be hard-pressed to find an electric model, with three times more internal combustion engine models available than electric in this price bracket (8 electric models vs. 27 electric models).