Ride share pic (via istock)

Buses of the future? Dr Jan Klein says peer-to-peer sharing can unlock self-driving electric car sales.

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45% ZE: UK bus sector is world leader in self-driving and clean fuel

Following the win for Project CAVForth at the inaugural Self-driving Industry Awards, the UK bus sector has achieved another notable auto tech success, this time in clean fuel.

Figures released on Friday (16th Feb) by the Society of Motor Manufacturers and Traders (SMMT) show that 1,159 zero emission (ZE) buses entered service in the UK last year. This equates to an impressive 45.1% market share for clean fuel, making us Europe’s biggest ZE bus market by volume.

Mike Hawes, SMMT Chief Executive, commented: “Britain’s bus sector is recovering strongly, powered by rising passenger numbers and government funding that is finally delivering new vehicles to routes up and down the country. We need the next round of funding – fast – to put even more on the road.

“Speeding up licence derogations could unleash demand in the minibus market, helping provide zero emission mass mobility for all with the air quality, carbon emission and wider economic benefits that come with this transition.”

Cars, vans and trucks lag behind UK buses in clean fuel penetration
Cars, vans and trucks lag behind UK buses in clean fuel penetration

That’s the aim. Delivering it is another matter. Compare the 45% clean fuel market share in the bus sector to electric taking just a 5.9% share of new van sales last year. That’s flatlining on the previous year, with diesel still accounting for 90%+ of all new light commercial sales.

You think that’s bad? In the heavy goods vehicle (HGV) sector, the SMMT confirmed that Zero Emission Vehicle (ZEV) registrations were up threefold in 2023. Unfortunately, that equates to only 234 units, meaning just 0.5% of all new UK HGV sales last year were ZEV.

This, remember, with sales of new non-zero emission trucks under 26 tonnes due to end in 2035. That’s currently the cut-off for non-zero emission new car and van sales too, of course. Although Shadow Roads Minister, Bill Esterson, reportedly said last week that Labour will restore the 2030 deadline.

Speaking of the UK new car market, how’s the essential shift to clean fuel going there? Well, according to the SMMT, 314,687 new battery electric vehicles (BEVs) were registered here in 2023, up almost 50,000 on the previous year.

However, that still represents a slight dip in market share, from 16.6% in 2022 to 16.5% in 2023. And the SMMT emphasises that this electrification has been “driven entirely by fleet investment”, propelled by “compelling tax incentives”.

The ZEV Mandate

Amid accusations of being behind the curve in EV adoption, in October 2023, the Department for Transport (DfT) unveiled the Zero Emission Vehicle (ZEV) Mandate – a new mechanism requiring 22% of new cars and 10% of new vans sold in the UK to be electric in 2024.

This ramps up to 80% of cars and 70% of vans by 2030, and 100% of both by 2035. Vehicle manufacturers that fail to achieve the ZEV Mandate sales targets will be subject to sizeable fines: £15,000 for every car that doesn’t comply, and £9,000 for every van in 2024 (with a plan to double this to £18,000 per van). 

Flexibility is provided via a trading scheme, enabling vehicle makers to bank compliance in years when they exceed annual targets, or trade them with other manufacturers that have fallen short.

In the first year, car manufacturers can borrow up to 75% of their annual target, to support them in the initial stages, although this will decrease sharply to just 25% in 2026.

Forced EV adoption warning

Against this backdrop, Dr Jan Klein, Associate Professor of Digital Marketing at the IÉSEG School of Management, in France, has highlighted the dangers of forced EV adoption and the benefits of peer-to-peer car sharing.

Dr Jan Klein, Associate Professor of Digital Marketing at IÉSEG School of Management
Dr Jan Klein, Associate Professor of Digital Marketing at IÉSEG School of Management

“The EU’s directive to ban combustion engine car sales by 2035, along with the UK’s similar zero-emission mandate, is reshaping the automotive industry,” he said.

“Considering the current technologies, this legislation compels the market to transition entirely to electric vehicles (EVs). This forced adoption poses a tremendous challenge as it clashes with established consumer behaviour in the car market.

“Traditional car buyers are not likely to embrace this forced adoption and might even lack the financial resources to buy EVs. Thus, the eventual outcome in 2035 remains uncertain, with the potential for a surge in sales of used cars with combustion engines.

“The adoption of new technologies is driven by the promise of enhancing the customer’s status quo. However, traditional car buyers often view EVs as costly and the transition as difficult, citing concerns about range, battery reliability, and charging infrastructure.

“A pragmatic strategy to boost EV adoption involves implementing legislation targeting company cars and car fleets, rather than imposing regulations on the entire market at once. Notably, drivers exhibit less resistance to EVs in this context, as the perceived hurdles shift from the individual customer to the company providing the car.

“Additionally, this approach, beginning with larger fleets, would foster the growth of a used EV market, ultimately enhancing affordability and driving wider adoption.”

Shared self-driving electric cars

Are shared self-driving EVs the cars of the future?
Are shared self-driving EVs the cars of the future?

As to how self-driving changes the game, Dr Klein highlights the potential for private owners to rent out their cars as robotaxis.

“The future of self-driving technologies raises interesting questions about their role in our transportation landscape,” said Dr Klein. “Will we continue to own them much like conventional cars? Or will they predominantly serve as a form of public transit, facilitated by companies or individual providers? 

“Self-driving technologies lend themselves well to an innovative peer-to-peer sharing model, where individuals can purchase a car and rent it out when not in use, akin to a holiday home. This approach transforms the car into a perceived investment and could potentially accelerate the adoption of self-driving vehicles. Elon Musk has already hinted at Tesla’s plans to enable such a feature in the future.

“Promoting peer-to-peer car sharing emerges as an interesting option to drive the adoption of EVs and self-driving cars. Owners can generate income by renting out their vehicles when not in use, providing a substantial financial incentive and alleviating the ownership burden.

“Encouraging peer-to-peer sharing may prove to be a more effective strategy for boosting the presence of EVs and self-driving cars, in comparison to government regulations. Currently, awareness about this option remains limited. However, the potential for growth in this domain is evident when we consider the thriving market for home rentals on platforms like Airbnb.”

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Author: Neil Kennett

Neil is MD of Featurebank Ltd. He launched Carsofthefuture.co.uk in 2019.