The corporate cars problem and what the EU can do about it

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.

Reported by Transport & Environment

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.

Download Report
Reported by Transport & Environment

Related Partner Reports

September 18th update

Why affordable electric cars in 2025 are feasible

This report assesses the possibility of making €25,000 battery electric vehicles (BEVs) accessible in Europe by 2025. It analyzes factors affecting car prices, automaker strategies, and market dynamics. The report explores automaker profits, the rise of SUVs, and the discontinuation of smaller car models. It also examines the economic viability of small BEVs and their potential to boost electric...
Reported by Transport & Environment
August 14th update

Leasing is lagging: An analysis of BEV uptake in France

This report investigates France’s car leasing sector, emphasizing major players, profitability, and impact on decarbonization and electromobility. It highlights record profits, mergers, and the industry's role in promoting sustainable transportation.
Reported by Transport & Environment
August 7th update

Battery metals demand from electrifying passenger transport

The report examines the demand for battery raw materials to electrify European passenger transport under different scenarios. It highlights the significance of smaller batteries, innovative technologies, and policy measures to reduce demand responsibly and sustainably.
Reported by
July 10th update

Addendum: Addressing the heavy-duty climate problem

This report assesses the European Commission's proposal on CO2 standards for heavy-duty vehicles (HDVs) and compares it to more ambitious targets suggested by T&E. It analyzes the proposal's impact on emissions, energy consumption, and the EU's carbon budget, highlighting its shortcomings. The report recommends stronger CO2 targets for HDVs based on industry commitments for zero-emission sales by 2030.
Reported by Transport & Environment
June 28th update

Critical Raw Materials Act position paper

This report analyzes the European Union's CRM Act proposal for securing critical metals in the renewable energy transition. It discusses China's dominance in metal refining and the impact of the US Inflation Reduction Act. The report emphasizes the need for a balanced approach, stronger requirements for strategic projects and environmental reporting, and alignment with European values and community involvement....
Reported by Transport & Environment
June 26th update

State of the Industry Report 2023

This report provides an in-depth analysis of Plug&Charge, an industry-wide innovation revolutionizing EV charging. It covers the development, implementation, and adoption of Plug&Charge technology, along with key trends and business perspectives within the eMobility industry. The report aims to help readers gain a comprehensive understanding of the industry developments and make strategic decisions on implementing this future technology.
Reported by Hubject

Get started Free of Charge

EV Reports Database