“It is not the right time to switch to EVs in some countries yet”
Electrification is definitely a trend in the fleet industry and for ISS World Services. However, the approach must be taken with caution, advises Patrik Havranek, Head of Group Fleet Management ISS World Services. His company recently announced that it will electrify its global fleet of approx. 20,000 vehicles with the support of LeasePlan by 2030.
"It's not only about the price and the related incentives, it is part of our overall responsibility as a company to address and prioritize actions that reduce our carbon footprint, supporting climate change and our Net Zero ambitions. We need to take into consideration the maturity of the markets, countries, availbility of charging stations and importantly what fuel source the countries use to power up their charging infrastructure", says Patrik Havraek. Under the global policy of facility service giant ISS, Havranek has a clear strategy towards accelerating electrification, taking into account all the aspects, including the volatile prices, delivery times and driver training.
Could you tell us about your role at ISS World Services?
“I'm managing the global fleet of ISS, responsible for all kinds of vehicles belonging to the fleet. Globally we have approx. 20,000 vehicles with 14.000 of them in Europe.”
What are the key elements of your strategy?
“The most important rule is that the car we choose has to suit our operational needs. 60% of our fleet consists of functional cars and vans. When choosing our vehicles, we have a set of criteria that are required to take into consideration:
- ensure that they have a low CO2 emission level. CO2 reduction is a big topic for us, but it is not just about the right vehicle, we look at other possibilities to reduce CO2 as well. Reducing scope 1 fleet emissions plays an important role for the company, and we have just issued a global policy with ambitious reduction targets.
- Choose EV’s if and when possible. As electrification is the most important lever, we ask the countries to accelerate the roll-out of BEV’s. We aim to become net zero on scope 1 emissions in fleet by 2030. This is the first global policy of ISS that tackles CO2 reduction and electrification, which will be launched soon.
Are there differences between countries in terms of going electric?
We assess each country individually together with our partner LeasePlan, which issues an “EV Readiness Index” every year, that we take as a basis. Nordic countries, Benelux and countries like Germany have more ambitious targets because they have incentives ready and/or the infrastructure is better prepared. We can't say this for all countries.”
How do you engage with countries in the process of electrification?
“Buy-in from the countries is key. As soon as we have the global policy approved, we will discuss with each country individually, as their insights and collaboration is key to the success of the implementation. We are OneISS and if we want to be successul in reaching our targets, we need to pull at the same side of the rope.”
Do you see any resistance in the electrification process?
“Electric mobility is welcomed in all of our countries, but we face different maturity levels especially in regards of recharging infrastructure. It is key, that the we roll out BEV’s in a clever way and create good stories. This will then create more appetite to go electric and reduce reservation and resistance. We aim to reach our targets on TCO cost neutrality, that's why have teamed up with LeasePlan to align on the actions we need to take in order to achieve our collective targets. We are not unrealistic: in some countries, you may have to invest more in infrastructure, but these investments will last at least two or three vehicle leasing cycles. So, we can amortize them over a much longer period and thus reducing the monthly impact.”
Do you already have EVs in your fleets?
“We have EVs in almost every European country, but it is still on a modest level. In 2022 we gave a directive to the countries to speed up the electrification process and work on the infrastructure and identify the cars that can be electrified first. Vehicles with a low yearly mileage and/or those that can easily be recharged during the night will be the first ones to be replaced. The EV’s that we have purchased years ago, are already outdated and the development of the technology is progressing with high speed. This and the further development and investments in public infrastructure will help us to successfully turn our ambitions into reality.”
Do you aim to use only BEVs or choose vehicles according to the driver profiles?
“We absolutely need to take the user profile into account. It is not our aim to make the operational work more difficult. At least for now, there is not always a suitable EV option available and also internal combustion engines see further improvements to boost their efficiency and lower their emissions. And let’s not forget PHEV’s. If they are used for the right driving profile (e.g. communting with less than 20 km one way and possibility to recharge them frequently), they can be a good alternative and can act as a bridge technology. But the consumption needs to be closely monitored. If they are not being used properly, they will possibly emit more than a good petrol or diesel vehicle.”
Do you have a plan to cope with the chip shortage?
“First of all, we have asked our countries to bulk buy as early as possible. It’s a fact that delivery lead times are significantly longer than they used to be two years ago. So by ordering early, we increase the likelihood to receive the cars in the same year. Secondly, by ordering EV’s we also match the need of most OEM’s, to lower their CO2 footprint. We can see that electrified vehicles tend to have a shorter delivery lead time. Thirdly, we look into contract extensions where it’s possible and financially attractive.”
How do you approach the volatile fuel and energy price situation?
“Currently, the higher fuel prices accelerate the transition towards electric mobility. Also, compared to five years ago, the resale value for electrified vehicles are significantly higher. So the high energy prices actually “fuel” our strategy. But the most efficient way to reduce the impact of sky rocketing energy prices is to drive less. In this respect, every country is asked to assess their savings potential. Because the increases will not stop with fossile fuels, we will or already see higher prices for electricity as well.”
The main photo shows Patrik Havranek, Head of Group Fleet Management ISS World Services,
The in-article photo shows a vehicle of the ISS fleet, courtesy of ISS.