Arval sees its fleet grow on back of EV demand in 2023

Pictured above is Arval UK managing director, Lakshmi Moorthy

BROKER funder Arval has seen its fleet grow by 2.9% during 2023 on the back of EV demand.

The total UK fleet size was 192,068 at the end of December 2023.

At the end of 2022, on the back of good broker business, Arval saw its feet grow to 187,208 vehicles.

In the FN50 2023, Arval was fourth placed with a fleet size of 189,243. The continued growth would see Arval comfortably maintain this position.

Arval attributed much of the rise during what were challenging market conditions, to the ongoing transition towards battery electric vehicles (BEVs).

Arval said its UK fleet now included 44,021 BEVs accounting for a 23% share of the total – up by 52% year-on-year. With 33% of new vehicle orders placed during December being BEVs, Arval believes the transition away from petrol and diesel was set to continue.

“The story of our growth in 2023 is very much centred on fleet adoption of zero-tailpipe emission vehicles. Businesses are rapidly moving in this direction, prompted by favourable benefit in kind taxation and a corporate desire to reduce their environmental impact.

“However, a further and perhaps unappreciated factor behind our success is that we are in a moment when leasing opens up new mobility options and helps customers to manage economic pressures. This is a key part of the organic rise in our fleet numbers.”

Lakshmi Moorthy, managing director, Arval UK Tweet

New mobility solutions part of success

Lakshmi went on to add that 2023 had also been a highly innovative year for Arval UK, with additional products contributing to the growth of the company’s fleet and supporting customers on the transition to new mobility solutions.

These included electric cargo-bike leasing, and Arval Re-Lease, which enables consumers to lease used vehicles.

Lakshmi said: “We unveiled our electric bike leasing programme last year. It is part of our concept of identifying the right vehicle for the right journey with optimum usage. Several customers are now using electric bikes for last mile deliveries in urban areas and to keep their staff mobile in cities with clean air zones.

“Notably, our electric bike fleet has grown by 133% in 12 months, primarily through electric cargo-bikes. We believe this is a market with huge promise.

“Similarly, our used vehicle product, Arval Re-Lease, has seen an 161% increase in lease numbers with a tenfold increase in the number of BEVs leased. This is supported by the rise in used BEVs now becoming available from previous leases. Again, we foresee further growth here in 2024 as this opens up access to attractive used vehicles, including BEVs, at a different price point for a whole new segment in the market. It also democratises access to EVs which may be perceived as expensive.”

Arval Total Care also saw growth

It wasn’t just vehicles that helped Arval UK last year, but its products, too.

Arval Total Care saw 34% growth while its Accident Management product also saw a 27% uptick.

There was also significant growth in salary sacrifice, with numbers increasing by 48% in 12 months said Arval UK.

Lakshmi said: “This is another area where the company car taxation advantages of BEVs are having a significant impact, making salary sacrifice initiatives very attractive to employees who want to lease a car by availing of the very attractive tax scheme in place.”