Driving the change in improved air quality with low-emission vehicles

Martyn Bellis, Sales Manager, Transportation, Siemens Financial Services in the UK, examines how finance solutions can help commercial vehicle operators to access the very latest technology

There is a pressing need for cities to clean up air quality, and commercial vehicles (CVs), including buses and coaches, have been identified as major contributors to air pollution. Citizens, however, rely greatly on CVs – recent research from the Society of Motor Manufacturers and Traders (SMMT) reveals that restricted or reduced services from CV-driven services would significantly affect the quality of life of the majority (88 per cent) of consumers.[1]

This is evidenced, in part, by the popularity of bus services, the most popular mode of public transport in the country.[2]Services in England and Wales are facing a period of substantial change – bus use is declining (a 1.4 per cent decrease compared to a year earlier)[3]. Many bus routes have been reduced or withdrawn, particularly in rural areas,[4]often as a result of reduced spending by local authorities.

One way in which CVs can continue to support citizens despite cuts is through improving motor technology to enhance air quality. Of course, pollution caused by tyre wear and brake dust is also to be tackled by a new government clean-air strategy, but the reduction of tailpipe emissions nevertheless forms a key step towards air quality improvement. North East England bus fleet Go North East, for example, trialled the region’s first fully electric, zero-emissions-attail-pipe bus in order to progress towards its aim of operating the greenest bus fleet in the UK. The vehicle is quieter than traditional diesel buses and boasts low battery and energy usage.[5]

Upgrading to the latest technology vehicles shouldn’t be a daunting prospect to SME CV operators. Working with a specialist finance partner with experience in this sector, such as Siemens Financial Services (SFS), will offer confidence. SFS has developed innovative finance solutions to enable CV operators to sustainably invest in low-emission technology. SFS’s finance models can, for instance, look at the Total Cost of Ownership (TCO) of a fleet, rather than the cost of an individual vehicle, and analyse fleets on the basis of cost per kilometre. In this way, financial solutions can be directly compared and incorporate the full range of costs, including capital expenditure, operating expenditure and any financing cost. Similarly, low carbon, as well as hybrid and electric buses and CVs, can be funded using customised hire purchase and fixed-term lease-finance solutions. With hire purchase, the vehicle is acquired by paying an initial instalment, for example 10 per cent of the total price, and the remaining balance is repaid as agreed monthly instalments to cover the full purchase cost. These bespoke, consultative models are built around the capital needs of the customer, designed to be long-term and offer the flexibility to accommodate future changes to technology. SFS is also able to offer interest-free finance for Siemens retrofits.

This sort of approach is only available from a financier with direct expertise in the field. Generalist financiers and banks are unlikely to understand the application of the technology and the benefits it can bring. Instead, working with an established company that not only has a long history in the sector, but is also part of the same company that developed the technology has obvious benefits.

CV operators are facing a unique set of challenges in an environment that is changing quickly, often in response to the needs of local residents and meeting air quality targets. By taking a fresh approach to investment, however, and by integrating finance and cutting-edge technology, a far more intelligent solution can be reached. Instead of viewing the costs of vehicles in isolation, operators can work with financiers which analyse the whole fleet, building a collaborative, consultative approach towards energy-efficient technology as it continues to develop.

If you would like to talk to Martyn Bellis about commercial vehicle finance, contact him at martyn.bellis@siemens.com

[1] SMMT News, Brits’ dependence on commercial vehicles revealed as new research shows 9 in 10 would be worse off without them (24 April 2018)

[2] Department for Transport, Transport Statistics 2017

[3] Department for Transport, Quarterly Bus Statistics, England Q1 (January to March) 2018

[4] BBC News, 2 July 2018, Buses in ‘crisis’ as 3,000 routes reduced or scrapped. 

[5] Intelligent Transport, 23 April 2018, North-east England’s first fully electric bus trial underway


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