VMF discusses fleet electrification: No alternative, but room for improvement

The 17th VMF Industry Forum of the Association of Independent Mobility and Fleet Management Companies (VMF), including Sixt, Allane, Arval, or Enterprise, was this year all about the "Electrification of Fleets."

"Electrification is a very relevant topic for fleet operators and all mobility service providers who support their customers with the challenges of electromobility in Europe," said Frank Hägele, Chairman of the VMF, at the beginning of the event and welcomed all participants of the 17th VMF Industry Forum.

He was very pleased with the good participation of members and premium partners. "Our VMF network covers the entire spectrum of mobility management know-how necessary for corporate customers and complements each other perfectly," Hägele promoted. Before the experts' presentations began, VMF Office Manager Dieter Brandl also welcomed the participants with a report from the office and gave an overview of projects and studies carried out so far. He was also able to report that in 2025 a new executive member, Choice AG, and a new premium partner, 2trade, will strengthen the VMF.

Status and Future of Electrification: Chinese Brands Marginal

Fitting the main topic of the industry forum, the VMF commissioned the consultancy firm Corporate Value Associates (CVA), specializing in the entire automotive ecosystem, to provide participants with a solid overview of "Strategic Developments of European Mobility Providers in the Context of the Increasing Electrification of Vehicle Fleets." Dr. Markus Collet and Max Müller from CVA presented the results. They showed that the increase in electric vehicles is particularly significant and will remain so for fleet operators.Although demand has weakened since the beginning of 2024, which can be partly attributed to the abolishment of the environmental bonus. This is especially troubling for manufacturers.

There is a lot of talk about Chinese brands, but their market share in Germany is still low. Volkswagen leads with over a 15 percent market share ahead of Tesla and BMW (each around 11 percent). The first Chinese OEM, MG, is only found in eighth place with a 5 percent market share. It remains to be seen to what extent and impact the tariffs on Chinese imports, which have just come into effect, will have. The looming penalties would also impact the offerings.

Uncertainty and Distrust about E-Mobility: No Going Back to Combustion Engines

The consultants noted that there is still uncertainty and distrust regarding electric vehicles. This is also reflected in the prices, where a strong downward trend is observed for both new and used cars. Fleet operators must deal with the correct use of electric vehicles as well as the fact that they have different requirements for maintenance, warranty, and insurance.

"Electric vehicles are, in the medium term, without an alternative for the politically required CO₂ reduction. Therefore, there is no way back to combustion engines," summarized Collet.

The Most Important Industry Issues: Residual Values and E-Used Car Market

Finally, the industry experts present were asked about the most pressing issues that those responsible must focus on. In a vote, the price development of battery electric vehicles (BEV), the volatile residual value development, and the used car market were mentioned. "This is still difficult to assess - and the rental and leasing industry feels it especially. Therefore, from our perspective, investment in BEV residual value models is necessary; strategies to mitigate damage in remarketing could involve multiple usage cycles, and a functioning BEV used car market with battery certification and warranties must be established alongside risk sharing with manufacturers," emphasized Müller. BEV new car prices are expected to drop by 2025, as a buyer's market will emerge.

Company Cars Still Trending – Companies Rely on Fleet Leasing

Finally, Katharina Schmidt from Arval Germany provided an overview of the current market by presenting the “Mobility Barometer” (Arval Mobility Observatory) and defining trends in corporate mobility. One finding: The biggest challenge for fleet managers in Germany and Europe is the implementation of alternative drive technologies. 44 percent of the surveyed German companies see this as one of the three most important issues. The study, which included over 8,500 interviews, highlighted the differences in fleets in Germany and other European countries. Fleet reduction is not an issue.

“In Germany, 89 percent of companies state that their fleet will remain stable or increase over the next three years,” said Schmidt.

Main reasons according to the study: Because the company is expanding or has new requirements that require company cars (68 percent), followed by the goal to enhance employer attractiveness (48 percent). Schmidt: “Companies want to retain employees and attract talent.”

Looking at how companies finance their fleet revealed that leasing dominates in Germany with an average share of 61 percent across all company sizes – the larger the fleets, the higher the share. Changes in the energy mix are also to be expected. In Germany, 88 percent of companies already use at least one alternative technology or plan to use it in the future.