The Rise of Electric Luton Vans: Are They Worth Leasing?

The rise of electric Luton vans has been causing a revolution in the commercial vehicle industry. These new vans, specifically designed for delivery and transport, are gaining traction among businesses looking to reduce their carbon footprint and operating costs. As more companies prioritize sustainability, electric Luton vans have emerged as a promising solution to address environmental concerns while maintaining efficiency in urban deliveries and long-distance transport. Website 

Electric Luton vans offer several advantages over their traditional counterparts. They have zero emissions, which helps to improve air quality in cities. These vans also have lower running costs, including reduced fuel expenses and exemption from road tax in many areas. However, businesses considering the switch to electric Luton vans need to weigh factors such as initial purchase price, charging infrastructure, and range limitations. This article will explore the growing popularity of electric Luton vans, their key benefits, potential drawbacks, and whether leasing or buying is the best option for businesses looking to adopt this eco-friendly technology.

What are Electric Luton Vans?

Definition and key features

Electric Luton vans are a type of large commercial vehicle that combines the spacious design of traditional Luton vans with eco-friendly electric propulsion. These vans are characterized by their distinctive peaked front, which extends over the cabin area, providing additional storage space. The name “Luton” originates from the town in Bedfordshire where the first models were produced.

Key features of electric Luton vans include:

1. Large cargo capacity, typically based on a 3.5-ton chassis
2. Peaked front over the driver’s cab
3. Tail lift for loading and unloading heavy items
4. Roller shutter door for easy access to the load area
5. Lightweight chassis made of strong reinforced plastic or fiberglass
6. Larger windscreen and wing mirrors for improved visibility
7. Comfortable cabin accommodating up to three people
8. Electric motor and battery system for zero-emission operation

How they differ from traditional Luton vans

The primary difference between electric Luton vans and their traditional counterparts lies in the powertrain. While conventional Luton vans use diesel engines, electric versions are equipped with electric motors and battery packs. This shift to electric power has several implications:

1. Zero emissions: Electric Luton vans produce no tailpipe emissions, making them more environmentally friendly.
2. Lower operating costs: They typically have reduced fuel expenses and may be exempt from road tax in many areas.
3. Quieter operation: Electric motors are significantly quieter than diesel engines, enhancing driver comfort and reducing noise pollution.
4. Instant torque: Electric motors provide immediate power delivery, which can be beneficial in urban driving conditions.
5. Regenerative braking: This feature helps to recapture energy during deceleration, extending the vehicle’s range.

Popular models in the market

Several manufacturers have introduced electric Luton van models to meet the growing demand for sustainable commercial vehicles. Some notable examples include:

1. Renault Master Z.E.: This model offers various chassis cab variants suitable for Luton box van conversions. It provides between 8.0 and 13.0 cubic meters of storage space in its panel van configuration.
2. Nissan e-NV200: While not a traditional Luton van, this compact electric van has gained popularity in the market.
3. Volkswagen ID. Buzz Cargo: This model combines retro charm with modern electric technology, offering up to 256 miles of range on the WLTP combined cycle.
4. Ford E-Transit: With up to 196 miles of range, this electric van maintains the same space as its diesel counterpart.
5. Fiat E-Ducato: This versatile electric van offers a wide range of body styles, including options suitable for Luton conversions.

These electric Luton vans are gaining traction among businesses looking to reduce their carbon footprint while maintaining efficiency in urban deliveries and long-distance transport. As the technology continues to evolve, it is expected that more manufacturers will introduce electric versions of their popular Luton van models.

The Growing Popularity of Electric Luton Vans

The rise of electric Luton vans has been causing a revolution in the commercial vehicle industry. As businesses prioritize sustainability and cost reduction, these eco-friendly vehicles are gaining traction, particularly in urban areas. Several factors contribute to their growing popularity, including environmental benefits, government incentives, and increasing demand in urban settings.

Environmental Benefits

Electric Luton vans offer significant environmental advantages over their traditional counterparts. These vehicles produce zero tailpipe emissions, which helps to improve air quality in cities. This aspect is particularly crucial as many urban areas are considering or implementing congestion charges and low emission zones. For instance, electric vans are exempt from London’s Ultra Low Emission Zone charges and congestion charge, potentially saving businesses up to £27.50 per day per vehicle. As other cities like Birmingham, Manchester, Bristol, Bath, and Oxford contemplate similar schemes, the appeal of electric Luton vans continues to grow.

Government Incentives and Regulations

The government has introduced various incentives to encourage the adoption of electric commercial vehicles. These include:

1. The OZEV Plug-In Van grant, which covers 35% of the vehicle price, up to a maximum of £5,000.
2. The Workplace Charging Scheme, offering up to £350 off the price of each charger installation for up to 40 charge points.
3. Exemption from Vehicle Excise Duty (road tax).
4. A 40% discount on Benefit-in-Kind taxes for entirely electric van fleets when there is a private van benefit.

These incentives make electric Luton vans more financially attractive to businesses, especially those operating in urban areas with emission-based charges.

Increasing Demand in Urban Areas

The operational profile of electric Luton vans aligns well with city logistics operations. They are particularly suited for:

1. Numerous starts and stops
2. Significant idle time
3. Relatively low average speeds

The current range of approximately 100 km for electric vans is well-suited for most operators within city boundaries. This makes them ideal for urban deliveries and short-distance transport.

However, it’s important to note that the transition to electric Luton vans is not without challenges. The heavy weight and volume of batteries can result in reduced payload compared to internal combustion engine equivalents. This may lead to larger electric vehicle fleets being required to maintain the same transport capacity.

Despite these challenges, the demand for electric Luton vans continues to grow. Major manufacturers are responding to this trend by introducing new models and expanding production. For example, Stellantis has announced that it will produce electric vans at its Luton factory from 2025, including models such as the Vauxhall Vivaro, Peugeot e-Expert, Citroën ë-Dispatch, and Fiat E-Scudo. This move is expected to help secure 1,500 UK jobs at the plant.

As the technology continues to evolve and charging infrastructure improves, the popularity of electric Luton vans is likely to increase further, playing a crucial role in the UK’s journey towards net-zero emissions by 2050.

Key Advantages of Electric Luton Vans

Electric Luton vans offer several significant advantages over their traditional diesel counterparts, making them an increasingly attractive option for businesses and organizations. These benefits range from financial savings to environmental improvements, positioning electric Luton vans as a forward-thinking choice for commercial vehicle fleets.

Lower running costs

One of the most compelling advantages of electric Luton vans is their reduced operating expenses. These vehicles have significantly lower fuel costs compared to diesel vans. For instance, charging the 75kWh version of the Vivaro-E costs around 28p/kwh and provides approximately 200 miles of range. In contrast, a diesel van returning 47mpg would cost at least £37 to fill (at 191p-per-liter) for a similar range. This translates to substantial savings in fuel expenses over time.

Moreover, electric vans have fewer moving parts than diesel vehicles, resulting in lower maintenance and servicing costs. The absence of oil changes and exhaust system repairs further reduces ongoing expenses. Additionally, electric vans are exempt from Vehicle Excise Duty (road tax) until April 2025, providing another avenue for cost savings.

Reduced emissions and noise pollution

Electric Luton vans have a significant impact on reducing environmental pollution. They produce zero tailpipe emissions, which helps to improve air quality, especially in urban areas where pollution is a major concern. This characteristic is particularly beneficial in city centers, where vehicles often operate in close proximity to pedestrians, outdoor markets, and businesses.

The University of Bedfordshire’s experience with electric vans demonstrates their environmental benefits. The university reported that their electric vans have helped reduce annual carbon emissions by using electricity instead of diesel fuel. These vans have traveled 33,171 miles since 2012, contributing to a substantial decrease in carbon dioxide emissions per mile compared to diesel equivalents.

In addition to reducing air pollution, electric Luton vans also help decrease noise pollution. Their quiet operation contributes to a more pleasant urban environment, particularly in historical city centers and residential areas.

Access to low emission zones

As cities implement stricter environmental regulations, electric Luton vans provide a significant advantage in terms of access to low emission zones (LEZs). Many urban areas are introducing LEZs to combat air pollution, and electric vans are typically exempt from the associated charges and restrictions.

For example, in London, electric vans are exempt from the Ultra Low Emission Zone (ULEZ) charges and congestion charge, potentially saving businesses up to £27.50 per day per vehicle. As more cities across the UK and Europe consider similar schemes, the value of electric Luton vans in urban logistics continues to grow.

Furthermore, electric vans often have unrestricted access to LEZs, allowing for 24-hour operation without limitations. This advantage is particularly beneficial for businesses that require flexible delivery schedules or operate during off-peak hours.

The combination of these advantages makes electric Luton vans an increasingly attractive option for businesses looking to reduce their environmental impact, lower operating costs, and maintain access to urban areas with stringent emissions regulations.

Potential Drawbacks to Consider

While electric Luton vans offer numerous benefits, businesses considering their adoption should be aware of several potential drawbacks. These challenges may impact the decision-making process and require careful consideration before transitioning to an electric fleet.

Higher initial cost Electric Luton Vans

The purchase cost of electric Luton vans remains a significant barrier for many businesses. Electro-mobility technology is still in its infancy and relies on expensive components, particularly the batteries. As a result, electric vans are typically more expensive than their diesel counterparts. The price difference can be substantial, with potentially thousands of pounds between the cost of a diesel van and its electric equivalent. However, it’s important to note that while the initial investment is higher, electric vans are usually cheaper to run in the long term.

Limited range and charging infrastructure

Range anxiety is a major concern for businesses considering electric Luton vans. Despite ongoing improvements, electric vans generally don’t travel as far on a single charge as diesel or petrol vans on a single tank of fuel. This limitation has several implications:

1. More frequent stops: Drivers may need to stop more often to recharge, potentially impacting delivery schedules and efficiency.
2. Longer charging times: Even with rapid chargers, which can provide an 80% charge in around 40 minutes, recharging takes significantly longer than refueling a conventional van. Home charging stations can complete a full recharge overnight, while a normal three-pin plug may require an entire day.
3. Charging convenience: Finding suitable charging locations can be challenging, especially compared to the widespread availability of fuel stations.
4. Long-distance impracticality: The current average range of approximately 100 miles for electric vans makes them almost entirely impractical for long-distance use.

The limited charging infrastructure further compounds these issues, particularly in regions with fewer public charge points. For instance, while London has 80 public charge points per 100,000 people, Yorkshire has only 20. This disparity may discourage businesses in certain areas from investing in electric vans.

Payload capacity concerns Electric Luton Vans

The weight of electric van technology has an impact on payload capacity, which is a crucial consideration for many businesses. The lithium-ion batteries in electric vans make them heavier than their diesel counterparts, potentially reducing the amount of cargo they can carry. For example:

1. The Renault Master ZE electric van has a payload of 1,100kg, while diesel models can carry more than 1,500kg.
2. The Mercedes-Benz E-Sprinter can only carry 731kg despite having a Gross Vehicle Mass (GVM) of 3,500kg.

To address this issue, the government has increased the GVM for electric vans from 3.5 tons to 4.25 tons to allow for the weight of the battery technology. However, this solution introduces additional complications:

1. Regulatory changes: Vans exceeding 3,500kg GVM are subject to regulations closer to those for Heavy Goods Vehicles (HGVs).
2. Additional requirements: These may include goods vehicle operator’s licenses, tachographs recording driver’s hours, and additional driver licensing requirements.

It’s worth noting that the payload capacity issue is less pronounced in smaller electric vans, where battery packs are generally smaller and weigh less. For instance, the Vauxhall Vivaro-e offers a payload of up to 1,226kg, compared to 1,458kg for the highest capacity diesel Vivaro – a difference of only 232kg.

Leasing vs Buying: Which Option is Best?

When considering electric Luton vans, businesses face a crucial decision: to lease or to buy. Both options have their merits and drawbacks, and the best choice depends on various factors specific to each company’s needs and financial situation.

Upfront costs comparison

The primary difference between buying and leasing lies in the initial financial outlay. Purchasing a van outright requires a substantial upfront investment, which can significantly impact a company’s cash flow. This large initial expense may be challenging for some businesses, especially smaller ones or those with limited capital.

Leasing, on the other hand, typically involves lower upfront costs. Instead of paying the full price of the vehicle, businesses make smaller monthly payments over a set period. This approach has an impact on cash flow:

1. Predictable expenses: Leasing allows for better financial planning with fixed monthly costs.
2. Preserved capital: The lower initial outlay frees up funds for other business needs.
3. Improved cash flow management: Regular, smaller payments are often easier to budget for than a large one-time expense.

Flexibility and upgrades

Leasing offers greater flexibility compared to buying, particularly when it comes to upgrading vehicles. This aspect is especially relevant in the rapidly evolving electric vehicle market:

1. Regular upgrades: At the end of a lease term, businesses can easily switch to newer models with improved technology and range.
2. Avoiding depreciation: Leased vehicles are returned at the end of the contract, eliminating concerns about resale value and depreciation.
3. Adaptability: Companies can adjust their fleet size more easily with leasing, adapting to changing business needs.

Buying, while less flexible, does offer complete ownership and the freedom to modify or sell the vehicle as needed. However, businesses must consider the rapid pace of technological advancements in electric vehicles, which may make owned vehicles obsolete more quickly.

Tax benefits and incentives

Both leasing and buying electric Luton vans come with tax advantages, but they differ in nature:

1. Purchasing benefits:
   • 100% first-year capital allowance: Companies can claim the entire cost of an electric vehicle against taxable profits in the year of purchase.
   • VAT recovery: Full VAT recovery is available on ongoing maintenance of owned vehicles.
2. Leasing benefits:
   • Tax-deductible expenses: Monthly lease payments can be deducted against profits as a business expense.
   • VAT benefits: VAT-registered businesses can claim back 100% of the VAT on lease and maintenance payments for vans used exclusively for business purposes.

Additionally, both options benefit from government incentives designed to promote electric vehicle adoption:

• Road tax exemption: Electric vans are currently exempt from Vehicle Excise Duty.
• Low emission zone benefits: Electric vans are often exempt from charges in urban low emission zones.
• Charging infrastructure incentives: Businesses installing charging points may be eligible for government grants and tax allowances.

It’s important to note that tax regulations and incentives may change over time, so businesses should consult with financial advisors to understand the most current benefits applicable to their situation.

Conclusion

The rise of electric Luton vans is causing a revolution in the commercial vehicle industry, offering businesses a greener and potentially more cost-effective alternative to traditional diesel vans. While these vehicles come with significant benefits, including lower running costs, reduced emissions, and access to low emission zones, they also present challenges such as higher initial costs, limited range, and payload capacity concerns. As the technology continues to evolve and charging infrastructure improves, electric Luton vans are likely to play an increasingly important role in urban logistics and short-distance transport.

When it comes to acquiring electric Luton vans, businesses need to weigh the pros and cons of leasing versus buying. Leasing offers lower upfront costs and greater flexibility to upgrade, while buying provides complete ownership and potential tax advantages. The best choice depends on each company’s specific needs, financial situation, and long-term goals. As the electric vehicle market matures and government incentives evolve, businesses should keep a close eye on developments to make informed decisions about their fleet management strategies.

FAQs

1. Are electric delivery vans a worthwhile investment? Electric delivery vans generally have a higher initial purchase price compared to diesel vans. However, they can provide substantial savings in the long run due to lower costs related to fuel, taxes, and maintenance. Additionally, electric vans offer a smoother and more comfortable driving experience, especially on longer journeys.
2. Should I consider leasing a van? Leasing a van can be financially advantageous as it usually requires lower monthly payments compared to buying a van outright. This arrangement can help improve cash flow for businesses by spreading the cost over time, making it a more manageable financial commitment.
3. Is it financially sensible to lease an electric vehicle? Leasing an electric vehicle (EV) can be more cost-effective than purchasing one outright. The process typically involves an initial payment followed by consistent monthly payments for the duration of the lease. Despite potentially higher lease payments for high-end EVs, the reduction in fuel costs, which could be up to 50%, helps balance the overall expenses.
4. Do electric vans cost more to insure? Insurance premiums for electric vans tend to be higher than those for traditional combustion engine vehicles. This difference is generally justifiable by the disparities in weight, cost, and performance between the two types of vehicles. However, various other factors might also influence the insurance cost, either increasing or reducing the overall difference in premiums.