Siemens is country's biggest operator of plug-in company cars

Six years ago, Siemens introduced its first plug-in hybrid car onto the fleet. Its first pure electric company cars arrived in 2017.

Today, the business has already tipped the balance of its 2,300-strong car fleet in favour of ultra-low emission vehicles (ULEVs), with more than 1,000 plug-in hybrids (PHEVs), 200 hybrids and 80 battery electrics (BEVs), plus another 30 BEVs on order with demand growing monthly. 

According to Fleet200 data from the UK’s largest fleets, Siemens is now the country’s biggest operator of plug-in company cars. 

And that’s just the start. Its current car order book is 80% PHEV and 6% BEV. Within the next couple of months, the CO₂ emissions average for the entire fleet, including the 900 light commercial vehicles (LCVs), will drop below 100g/km.

Vans are trailing, though not through a lack of desire. Several parts of the business have taken delivery of their first electric vans, but the complex nature of the journey profiles and lack of range mean the uptake opportunities are currently limited.

Wayne Warburton (pictured), Siemens head of UK Mobility Services, has overseen a rapid transformation in the business, one that has been driven from the top. The nature of Siemens business helps – it offers its own charging solutions, for example – but the global mission statement tells the story. Sustainability, it says, “is at the heart of our business activities”.

This provided the catalyst in September 2015, when Siemens committed to be carbon-neutral by 2030. Fleet falls within scope one, accounting for half of Siemens UK carbon emissions, while travel sits in scope three.

“We didn’t want to offset our emissions, we wanted to reduce them,” Warburton says.

The car policy, managed in partnership by leasing provider Lex Autolease, uses an online platform for the drivers and is based on two mileage bands: high and low.

Employees on the low band, travelling fewer than 8,000 business miles a year, are given the option of company car or cash; high band must take a company car. Of the 2,300 company car drivers, a little more than a third (35%) are in the low band.

High band drivers can choose diesel or PHEV, but not electric; low band drivers can only choose PHEV or full electric. The policy was introduced two years ago and has “seen the numbers start to take off”, says Warburton.

He adds: “We are about to change our policy to include a medium band which will open up electric to high business mileage drivers. This is where the data is key – car driver travel patterns analysis provides data for drivers, helping them to decide if they could switch to electric. By the end of this year, we will probably have 300 full electric vehicles (EVs).”

Several hundred employees opt for cash, but Siemens is now reviewing the policy in line with its focus on sustainability, not least as the data shows the CO2 emissions on the cash fleet are far higher than the company fleet.

“Lex is now managing all our cash-taker processes and is starting to share valuable data with us that we can use to align the cash-taker policy to our sustainability goals as a business and also share the benefits of moving back into a company car with the tax advantages that were not available three-to-five years ago,” Warburton says.

The fleet team plays an active role in supporting and advising employees about the best options in terms of cost and emissions, beginning with a renewal call nine months before they are due to change. 

“We introduced this approach six months ago and it’s been very well received,” says Warburton. “It’s like a helpdesk and it’s working – we are seeing the increase in ULEVs.”

Global tendering has helped to unlock discounts on PHEVs, now reaching a similar level to diesel, while even EVs are starting to see limited discounting.

This is making them far more competitive on a total cost of ownership (TCO) matrix. Over a four-year operating cycle, Warburton has found at lot of EVs to be cheaper than diesel across most comparable models.

“So, there are savings for Siemens as well as the driver and the planet,” he says. 

“What’s making the difference is the maintenance and fuel. As leasing companies get a better understanding of how much cheaper they are to maintain, they are no longer loading the SMR from a risk point of view.

“The main driver, however, is the fuel savings on offer to the employee and the business and by moving to a TCO model this is very apparent in making an EV the sensible choice.”

A central part of any EV strategy is the workplace charging infrastructure. Siemens has installed more than 100 charge points across its 12 main sites, with 26 alone at its Manchester head office.

All are 7.4kW chargers, as they met the needs of its PHEVs, although the next round of investment will prioritise 22kW/50kW with a future roadmap already earmarking 150kW for high demand sites. The cabling has been future-proofed to allow upgrades with minimal disruption.

Siemens has two four-hour charging slots, morning/afternoon, via an online booking system to ensure the maximum number of employees are able to charge their cars. Around a quarter of staff with PHEVs have also fitted a home charger at their own expense, although it is not mandatory.

However, anyone choosing a full electric car does have to commit to investing in a home wallbox.

It’s not been a deterrent, as the benefit-in-kind (BIK) tax savings available for both PHEV and BEV easily make up for the investment in the charger, particularly when the Government grant is taking into consideration.

Plug-in hybrids have proven to be a stepping-stone to full electric, enabling employees to get used to charging their vehicle without worrying about range. Of the 80 drivers with a BEV, more than 80% previously had a PHEV.

“We are definitely seeing PHEV drivers move to full electric on their next car change,” Warburton says.

Siemens has also introduced greater flexibility with the leases, potentially further increasing their appeal. The traditional four-year operating cycle has been expanded to include two or three years, although most still opt for the longer period. 

Warburton’s biggest challenge is the van fleet, where range and availability is “two-to-three years behind cars”. Each business unit has a 10-year roadmap to convert the fleet to electric, but vans are home-based, so the priority will be to agree a solution for home charging/billing. 

“Some of our business units are targeting 100% electric by 2028 and I can see that happening for cars, but vans are more of a challenge,” he says. “The next three-to-four years is when we need to switch a lot of those vehicles over.”

Telematics data will play an important role in identifying the vans which can be changed first. It will also underpin a process change: Siemens currently allocates the nearest van to a job; in future it will need to overlay this with available range to ensure the driver can get there and back.

It’s all part of a five-year learning curve for Warburton and Siemens, one which underlines the changing role of the decision-maker – not least the importance of using data.

“The fleet manager role is not about leasing and managing drivers any more; you need different skill sets. You have to work with HR, with real estate and with sustainability. You have to understand charging requirements. You have to be more strategically linked with suppliers – they are learning too, but they have a lot of knowledge,” Warburton says.

“It is no longer enough to do a policy review every three or four years. We look at our policy every 12 months using data to facilitate decision-making. Without data, you are making decisions blind, but you also have to be able to present it in the right way to senior management. 

“Here, we are supported by our leasing provider and their team of consultants and a dedicated fleet analyst to ensure all this data tells the right story to these key stakeholders.”

A fleet steering committee brings together supply chain, HR, health and safety and directors from the four main business units for quarterly meetings. 

“Two years ago, the agenda was dominated by cost and safety, but that’s now the bread and butter. Today, 90% of the discussion is on sustainability,” Warburton adds.

Sustainability also means looking beyond fleet to mobility solutions – another example of the diversifying role of the fleet manager where travel and fleet responsibilities are merging.

As the category manager for UK Mobility Services, Warburton is constantly assessing new services under the mobility as a solution (MaaS) umbrella. His report so far? “There are some good solutions out there, but it’s not quite ready yet.”

Fast-forward a decade or two, however, and with growing urbanisation, “many people won’t even want a car – it’ll be a monthly travel allowance and a system that can book end-to-end travel, from train to e-scooter or ride hail”.

This mobility evolution will begin within the next two-to-three years, with added impetus coming from councils under pressure to improve local air quality. It will be a fundamental shift, but with the greatest impact on user-choosers rather than vans and high mileage business drivers.

Siemens has a couple of MaaS pilots underway in Germany and Belgium, both countries more suited to a mass roll-out of mobility services than the UK: Belgium because of its train network and high bicycle ownership; Germany due to the proliferation of car hire companies offering solutions.

The double whammy of Covid and Brexit has stifled progress in the UK, but Warburton hopes to launch his own trial later this year with a small number of employees. He predicts MaaS will be more of a localised and location-based service than a national offering.

“I don’t see MaaS being offered carte blanche,” he says. “It will be offered to select individuals and linked to certain cities, such as London and Manchester, which have e-bikes and so on.

“There’s no point in giving people a mobility package if all they can do is book a train. It will be location-dependent.”

Warburton on...

…electric cars 

Wayne Warburton was one of the first in the business to run a plug-in hybrid car in 2016, using it as a stepping-stone to switch to a full electric Mercedes-Benz EQC four years later.

The EQC’s stated range is 259 miles; Warburton has been typically getting 220 miles during summer. He advises other EV drivers against using the heater during winter – it can sap another 20 miles of range.

“They say put the electric seats on, not the heating, because it uses less charge,” he says. “Of course, you can also pre-heat the car via the app while it’s still on the charger.”

He charges via a home charger and uses Zap-Map to track down public charge points, typically using the Ionity network’s 350kW units which can fill from 10% to 80% in 20 minutes. Concerns over the public network are largely unfounded, he believes.

Regenerative braking helps to preserve charge, as does running the car in Range Max, the most efficient mode. However, even running it in eco, Warburton is comfortably exceeding 200 milesof range.

“I learned so much having my car, so I can provide advice to others,” he says.

…‘for every £1 of cost, we save £5’

Wayne Warburton has been with Siemens for 25 years, the past seven as category manager of Mobility Services. 

He sits within the central department for all indirect spend, including fleet, travel, temporary labour, PPE, logistics and office supplies. It pools the demand across Siemens’ UK businesses to get the best deals, consolidate suppliers and build strategic relationships. 

The core financial KPI is that “for every £1 of cost, we save £5 of money – that’s the return on investment that our department brings”, Warburton says.

He is responsible for fleet and travel.

The vehicle fleet accounts for the majority of Warburton’s time, around 80%, although that increased after three parts of the business – Healthcare, Energy and Spain-based Siemens Gamesa Renewable Energy (SGRE) – were separated from the main plc. Each now has its own sustainability manager, increasing the number of stakeholders in fleet.