Transition to electric company cars accelerates

New figures released by HMRC show that the transition to electric vehicles continued into 2022/23, with nearly a quarter of a million company cars now fully electric.

While back in 2002/03, 58% of company cars had reported emissions of 165g/km or more, the latest HMRC statistics highlight that only 2% of company cars had emissions of 165g/km or more in 2022/23.

The number of company cars with CO2 emissions of 75g/km or less rose to 369,000 from around 243,000 the previous year. This includes fully electric cars, which increased from 50,000 in 2020/21 to 125,000 in 2021/22, and then to 222,000 in 2022/23.

HMRC statistics also show a significant decrease in the proportion of diesel company cars. Diesel cars made up about 80% of company cars until 2017 but dropped steadily to 49% by 2020/21, and further down to 23% (170,000) in 2022/23.

One notable impact of the rise in electric vehicles is the reduction in the average CO2 emission rate of company cars, now at 86g/km. Even when excluding electric cars, the average emission rate has decreased to 99g/km, indicating a broader shift towards lower-emission fossil fuel vehicles.

The number of ultra-low emission vehicles (ULEVs), with CO2 emissions of 75g/km or less (excluding zero-emission vehicles), has also increased steadily over the years, from 5,000 in 2014/15 to 147,000 in 2022/23.