Corporate fleets are Europeʼs biggest car market. They account for 58% of new sales and - given their high mileage - are responsible for 74% of emissions of new cars. Electrifying corporate cars would rapidly accelerate electrification and transport emission savings in Europe. The latter is crucial given that the EU and Member States have recently increased the ambition of the Effort Sharing Regulation (ESR), setting binding 2030 targets for road transport, heating, agriculture, small industrial installations and waste.
But the EU is currently missing out on this big opportunity. The EUʼs largest automotive market is lagging behind on electrification. In 2022, 10.8% of new corporate cars were battery electric vehicles (BEV) compared to 14.5% for the private market, and this gap is only growing.
The upcoming Greening corporate fleets initiative – announced by the European Commission (EC) in its 2023 Work Programme – is the opportunity for the EU to reverse this trend.
Looking at five different policy scenarios, this report analyses the impact EU action on fleets can have. Our analysis shows that the benefits are multiple. Setting binding targets for all new corporate cars to be zero-emission by 2030 (the most ambitious policy scenario) would deliver the following positive effects, alongside existing car CO2 standards:
CO2 emission cuts
Emissions of cars are reduced by an additional 30 MtCO2e for the year 2030. The fleet targets would as such reduce the ESR emissions gap already by 37%, showing that EU action on fleets is crucial for the EU and Member States to meet their increased ESR targets.
Accelerate the uptake of zero-emission cars
11 million additional zero-emission vehicles (ZEV) will be on our roads by 2030, replacing polluting diesel and petrol cars. A binding EU fleet target will guarantee continuous growing demand for ZEVs and as such support European OEMs in their transition to become electric carmakers and the goals of the EU Green industrial plan to bring e-car and battery production to Europe.
Faster supply of affordable second-hand zero-emission cars
Today almost 8 out of 10 EU citizens buy their car second-hand. Given their much shorter ownership period (three to four years), electrifying corporate cars can rapidly accelerate the supply of affordable second-hand ZEVs. A binding EU fleet target will bring 12.5 million additional second-hand ZEVs on the market by 2035.
Oil import savings
Oil imports are further reduced by an additional 208 million barrels of oil by 2030 and 1,029 million by 2040. EU fleet targets will therefore bring a big contribution to the EUʼs efforts to increase energy security and become less dependent on oil imports.