Road to net zero emissions by 2030 1 Welcome Join in the - - PowerPoint PPT Presentation

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Road to net zero emissions by 2030

Welcome

Join in the conversation!

#EV2030

Any car Anytime Anywhere

What’s next is our inspiration and aspiration

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What’s next in the automotive industry? What’s next in technology? What’s next in mobility? What’s next in lower emission vehicles?

Our ambition is to provide what’s next for our industry

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950,000 3 million 5.3 million

Key megatrends are changing the mobility landscape

LeasePlan has a clear focus on sustainability Our objective:

Achieve net zero emissions from our total fleet by 2030

Tex Gunning:

“You don’t have to change your strategy, you just have to say: We’ll go electric.”

EV100 will use companies’ collective buying power and influence on employees and customers to build demand and cut costs. Members see the business logic in leading a faster transition.

Helen Clarkson, CEO The Climate Group

Over half the cars on the road today belong to

• companies. Making the

transition to an electric fleet is one of the easiest ways for businesses to help tackle climate change.

Tex Gunning, Chief Executive Officer LeasePlan

• Major global initiative designed to fast-track EV

uptake among corporates

• Members commit to transition to electric vehicle

fleets by 2030

• Announced around UN General Assembly in New

York on September 19 2017

• EV100 partners: Unilever, Baidu, IKEA Group, HP

Inc., Vattenfall, PG&E, Deutsche Post, DHL and Metro AG

• LeasePlan is the only automotive company to join

the initiative

EV100 initiative from The Climate Group

• Providing education on what’s next in

low-emission vehicles

• Facilitating in making the switch with our

electric vehicle proposition

• Advocating zero emission mobility
• Leading by example - LeasePlan’s own fleet

will be fully electric by 2021

How are we going to do that?

Today’s agenda

What’s driving the need for increasing fleet sustainability? Matt Dyer, LeasePlan UK Managing Director What are the latest developments in technology related to lowering emissions? Nicolas Meilhan, Frost and Sullivan Principal Consultant How can you lower the emissions of your fleet? Matthew Walters, LeasePlan UK Head of Consultancy Services

Matt Dyer, LeasePlan UK Managing Director

What is driving the need for increasing fleet sustainability?

• Carbon Emissions
• Reducing Air Pollution
• Cost of Fuel
• Government Action
• CSR

.. and it’s not going away.

The pressure on businesses to reduce emissions is growing

Industry 21% Transportation 14% Buildings 6% Agriculture, forestry and other land use 24% Electricity and heat production 25% Other energy 10%

20% in the EU

(only CO2)

30% in the US

(only CO2) Sources: EPA, IPCC, EU statistics, Boden, T.A., Marland, G., and Andres, R.J. (2017)

Transport is the fastest growing contributor to climate change

Impact of UK transport on the environment

38 million vehicles

• n the

road

324 billion miles

driven a year

112 million tonnes

GHG emissions

Source: Department for Transport

Evolving Powertrain split

Source: Society of Motor Manufacturers and Traders

Potential miss on EU 2021 CO2 targets?

If consumers, with no option of transitioning to hybrid or EVs, switch to petrol the environmental impact is clear – their CO2 emissions would likely rise between 3% and 23% according to model.”

CAP HPI

EU 2021 CO2 Targets: Manufacturer rankings

Rank* Carmaker 2016 2018 2021 2021 Target Deviation 1 Volvo 119,2 110,0 73,1 103,5

• 30,4

2 Toyota 105,5 91,7 83,5 94,3

• 10,8

3 Renault-Nissan 109,7 106,5 91,4 92,1

• 0,7

4 Hyundai-Kia 124,4 115,3 94,9 91,7 3,2 5 PSA (Peugeot Citroen) + Opel 110,3 104,4 95,6 92,6 3,0 6 Ford 120,0 110,8 96,1 93,0 3,1 7 Volkswagen 120,0 115,7 100,3 96,3 4,0 8 FCA (Fiat Chrysler) 120,0 116,6 101,2 91,1 10,1 9 Daimler 124,7 117,2 102,1 100,7 1,4 10 BMW 121,4 119,3 104,7 100,3 4,4 11 JLR (Jaguar Land Rover) 150,0 142,3 130,9 132,0

• 1,1

Volvo looks to lead… electric by 2019

• 2021 CO2 targets are unachievable without diesel powered vehicles
• Diesel engines remain a viable option, especially for large cars and CVs
• New cleaner diesels offer better fuel economy and lower emissions
• Real Driving Emissions Test applies to all models from September 2017 and all new

registrations from September 2019

• New Euro 7 standards currently under development & due to be introduced in 2021
• The newest, cleanest diesels will be exempt from ULEZ and CAZ fees, higher VED

rates and the CCT diesel supplement

• The smaller vehicle segment will be dominated by petrol in the mid term
• The powertrain mix in 2030 will be heavily determined by the capability of charging

infrastructure – especially for Hybrids versus Battery Electric Vehicles

The Powertrain Mix

Pump Prices

Source: Department for Business, Energy & Industrial Strategy

2008 – Climate Change Act 2008 – London’s Low Emission Zone 2010 – Air Quality Regulations (NOx) 2015 – Emissions Testing Scandal 2017 – Air Quality Plan published (NOx) 2017 – Clean Growth Strategy (CO2) 2018 – 29 councils to introduce Air Quality Plans 2019 – 5 cities to implement Clean Air Zones 2019 – London’s Ultra Low Emission Zone comes into effect

Government In Action

Regulations

• ULEZ
• Clean Air Zones
• New emissions standards RDE 2

Taxation

• Higher VED rates for diesel
• Diesel Supplement for CCT
• VED and CCT linked to CO2 emissions

Carrot and Stick

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Low Emission London

London has been the main site of recent action against diesel emissions: October 2017: T-Charge introduced

• T-Charge £10 per day on vehicles not meeting Euro IV emissions standards

April 2019: ULEZ introduced Meet Euro VI (diesel) or Euro IV (petrol) emissions standards – or pay a fee

• £12.50 per day for cars, vans and motorbikes
• £100 per day for lorries, buses and coaches

TfL is currently consulting on expanding the ULEZ in 2020 and 2021

England’s Clean Air Zones

Birmingham, Derby, Leeds, Nottingham, Southampton are all due to introduce Clean Air Zones in 2019 In London the ULEZ builds on an existing system of Congestion Charge, but these cities do not have similar infrastructure (cameras, etc) Nor do they have the charging infrastructure for electric alternatives The Government has set aside some money to help:

• £255m Implementation Fund
• £220m Clean Air Fund

What about LCVs operating in these zones?

“Commercial vehicles make 280,000 journeys

• n a typical weekday, travelling a total

distance of eight million miles. Vans represent 75% of peak traffic, with over 7,000 vehicles per hour driving at peak times in Central London alone.”

Ford & London Initiative

Summary

The automotive and leasing industries are pushing and governments are pulling to make transportation more sustainable

Government Automotive and leasing industries

Supporting fiscal structure Clean Air Zones Emissions standards Clean Diesel Electric Vehicle / Plug-in Hybrid New usage models

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Road to net zero emissions by 2030

Nicolas Meilhan, Frost and Sullivan Principal Consultant

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What are the latest developments in technology related to lowering emissions?

What are the latest developments in technology related to lowering emissions?

Lithium Ion Battery Pack* Cost Estimates ($/kWh)

Source: Frost & Sullivan

Expected decline in battery prices drove vehicle manufacturers to develop Battery Electric Vehicles with larger batteries

OEM Model Technical Specifications

• Battery size – 79 kWh
• Power – 300 kW
• Torque – 700 Nm
• Range – 500 km (NEDC)
• Charging Capacity – 350kW
• Launch year – 2019
• Battery Size – 95 kWh
• Power – 300 kW
• Torque – 800 Nm
• Range – 500 km (NEDC)
• Charging Capacity – 350kW
• Launch year – 2018

EQ e-Tron Quattro

Vexed by Tesla, Audi and Mercedes plan to launch EVs with 60 kWh+ batteries and ultra fast charging capability to compete with Tesla on range as well as charging time

2018 2019 2020 2021 2022 2023 2024 2025 Tesla targets annual sales of 500k JLR will electrify all models Tesla targets annual sales of 1mn units Volvo targets 1mn cumulative sales of electrified cars Daimler plans 15-25% of production to be electric VOLVO will no longer sell cars solely powered by ICEs Daimler targets annual sales of 100,000 units Porsche plans 50% of cars to be electric BMW plans 15-25% of sales to be electric VW plans to have 30 new EVs accounting for up to 25%

• f sales

(2-3mn units)

Electric Vehicle Announcements by Vehicle Manufacturers

• 2018 to 2025 -

Renault targets 20% of the cars to be electrified (8 BEVs) full cost profit expected

More than 25 models for almost every OEM are expected to have a 300km+ in the next 5 years. OEMs have a 500km range benchmark to match the performance of the EV to an ICE.

With the future launch of those EVs with 200+ miles range, the industry is wondering whether PHEVs is only a short term solution or whether it is expected to contribute significantly to the future of the electric mobility Vehicles & End-Users Targeted Risks BEVs

• Weight < 1.5 tons
• Segment A & B
• Urban
• Commuting
• 2nd vehicle
• Requires the deployment of a fast charging network
• Electricity grid constrains at local level as well as on highway corridors
• Limits on cobalt and lithium availability if deployed in large scale
• Limited range in highway driving conditions

PHEVs

• Weight > 1.5 tons
• Segment D & Higher
• Suburban & Rural
• Unique vehicles
• Limited incentives compared to BEV as not 100% electric
• Electricity grid constrains at local level
• More complex architecture as embarking 2 powertrains
• Some end-users don’t charge it
• NEDC cycle too optimistic on fuel consumption & CO2 emissions

FCEVs

• Weight > 1.5 tons
• Segment D & Higher
• Suburban & Rural
• Unique vehicles
• Needs renewable electricity to produce clean hydrogen & increase well

to wheel energy efficiency

• Expensive fuelling infrastructure to be deployed
• Limits on platinum availability if deployed in large scale

• 1 kWh LCA battery = 800 gr of Lithium Carbonate Equivalent =

150 gr of Lithium = $12 lithium BoM*

• 80 kWh LCA battery = 64 kg of Lithium Carbonate Equivalent = 12

kg of Lithium = $960 lithium BoM*

• Tesla Gigafactory producing 500,000 batteries would require 2015

global lithium production for batteries (40% of global lithium production)

• LCE prices were multiplied 2 fold in 6 months but are expected to

stay below $15k/ton in the long term  No issue in the short/medium term with lithium

• 1 kWh Li-ion battery = 200 gr of Cobalt
• 80 kWh Li-ion battery = 16 kg of Cobalt = $1,200
• Cobalt was in supply deficit in 2017
• Cobalt is a by-product of copper & nickel mining hence limited

possibility to increase supply

• Cobalt in rechargeable battery chemicals already represents

about 45% of total cobalt demand

• 65% of mined cobalt comes from RDC & 50% of the world's

refined cobalt from China  Potential supply constrain & geopolitical risks for cobalt sourcing

*Bill of Material

Lithium Cobalt

Prices in $/ton

Metal Independence Shifting the resource availability issue from oil to metals do not address it – it only moves it

2010 2015 2020 Battery Capacity 20-30kWh 30-60kWh 60-90kWh NEDC Range Up to 200 km 200-400 km +400 km

• Even if BEVs are expected to reach 500km

driving range, it is in city driving conditions

• When driving on highways at 130 km/h,

driving range is 50 to 60% of the NEDC range

• At 130 km/h, the energy consumption more

than double compared to 90 km/h with aerodynamic forces tripling to account for 80% of friction forces BEV battery capacity, NEDC & highway range roadmap Power required to balance mechanic & aerodynamic friction forces

80% Power to balance mechanical losses Power to balance aerodynamic losses

Speed (km/h) Power (kW)

20% 73% 27% 65% 35%

Source: Gregory Launay

22 kW 9 kW 15 kW

Highway Range Up to 100 km 100-200 km +200 km

Highway Range When driving on highways at 130 km/h, driving range is only 50 to 60% of the NEDC range for a BEV

Local distribution grid

“If two EV customers on the same transformer plugged in a 6.6 kW charger each during a peak time, their load could exceed the emergency rating of roughly 40% of distribution transformers in the US” Silver Spring Networks

• Since 6,6 kW chargers draw an electricity load equivalent to a

house (7 kW for a typical residence), utilities will need to invest in updating distribution networks and potentially add generation and transmission capacity.

• Smart grid allowing load shifting will be critical to ensure

smooth charging of multiple electric vehicle in the same neighbourhood

• The impact on the local grid is expected to be equivalent

between a PHEV and a BEV as they are likely to charge an equivalent “amount” of energy – what they used to commute

• Charging power is expected to have the strongest impact on the

local grid

Fast charging on highways

• Fast charging station in fuel stations will have to connect to

the medium voltage grid which could represent significant installation cost

• Project under development do not plan to install more than

two ultra-fast charger (150kW) to be compared with 10+ gasoline/diesel “chargers”

• With an ultra-fast charging 10 times as slow as regular fuelling

(10 min for 200 km vs. 3 min for 600km) and 5 times less “fuelling” points, availability for “refuelling” large BEVs will be 50 times more limited than for regular car

• As most of the drivers tend to travel long distance at the same

moment (week-end, holidays), a charging infrastructure 50 less dense won’t be able to address this peak demand

• Fast charging network is not needed for PHEVs as they are

able to drive on ICE for long distances and use the existing ultra fast charging infrastructure

Charging Infrastructure Availability Electric Vehicles will require significant investment to upgrade the local distribution grid and be able to charge everyday as well as to deploy a fast charging network on highways

25,500 electric vehicles were sold in Japan in 2015 out of 5 million passenger car (0.5%) Contrary to what the industry believe, BEVs sales might not surge even with large scale deployment of fast charging infrastructure Charging Infrastructure Availability Even with a very dense network of fast chargers, BEVs sales might not follow. In Japan, fast charging infrastructure already reached saturation levels but EV sales are declining

• With 80% of electricity coming from thermal plants, FCEV well-to-wheel energy efficiency

is currently more than twice as low as ICE vehicles at less than 10%

• Clean hydrogen produced from fatal electricity from intermittent renewables is required to

make FCEV an energy efficient alternative

• Renewable energies are only expected to reach 8% of primary energy mix by 2035 hence

availability of hydrogen from their fatal electricity production will be in the % scale

Source: BP Energy Outlook 2035

Mtoe

Evolution of world primary energy consumption

• Million tons of oil equivalent & % , 1965 to 2035 -

Energy Efficiency With 80% of electricity coming from thermal plants, FCEV well-to-wheel energy efficiency is currently twice as low as ICE vehicles at less than 10%

World all liquids production & forecast

• Million barrels per day, 1900 to 2020 -

Source: Jean Laherrere, ASPO France, June 2016

Production Mb/d

Oil Independence Reducing the 97% oil dependence for transportation is critical as we will face an oil availability constrain by 2020 following the lack of investment in oil E&P since the oil price collapse in 2014

Sources: Frost & Sullivan analysis

Affordability Metal Independence Highway Range Charging Infrastructure Availability Energy efficiency* Oil Independence ICE Most cost competitive alternative 5 Platine in catalytic converters 4 More than 500 km 5 Infrastructure existing 5 18% Gasoline 22% Diesel 3 100%

• il

1 23 BEV High cost of 60kWh battery 3 Lithium and cobalt for 60 kWh battery 2 Up to 300 km 3 Fast charger network & local grid upgrade 2 20% 3 100% electric 5 18 PHEV 20kWh battery 4 Lithium and cobalt for 20 kWh battery 3 More than 500 km 5 Local grid upgrade 4 20% 3 80% electric 20% oil 4 23 FCEV High cost of fuel cell stack 2 Platinum in the fuel cell stack 2 More than 500 km 5 Network of hydrogen station 1 8% 1 100% electric 5 16

* Well to wheel

PHEVs do not need an expensive fast charging infrastructure deployment, can reduce oil consumption by as much as 80% and uses four times as less supply-constrained cobalt than BEVs

Sources: Frost & Sullivan analysis

Plug-in hybrids represent the best trade-off for a sustainable vehicle at a global scale in the short to medium term - up to 2030

• ICE will represent the majority of vehicle sales for another 15 years until it is ban in 2040
• BEV still faces too many challenges – cost, cobalt availability, highway range, fast charging infrastructure – to have a

chance to replace ICE at a global scale

• Hydrogen is not likely to reach mass market before 2030 : no significant advantage over a PHEV while it requires high

investment to set up a “charging” infrastructure

Source: Ricardo analysis

2030 Powertrain mix in developed market

• Limited charging infrastructure scenario -

Electrification of vehicles will take place progressively starting with plug-in hybrids whose electric driving range will increases as battery prices decreases until they can cover 80% of all trips in electric mode

Source: Frost & Sullivan Analysis

Stuttgart 2018: Ad-hoc Ban of Diesel <Euro 6 Athens: 2025: All diesel ban Madrid 2025: Ban Diesel < Euro 6 and Gasoline < Euro 2 2025: All diesel ban Norway 2025: All ICE ban Paris 2016: Ban of Diesel < Euro 2 2017: Ban of Diesel < Euro 3 2024: All Diesel ban 2030: All ICE ban London 2017: £10 charge for ICE < Euro 4 2019: £12.5 charge for Diesel < Euro 6 and Gasoline < Euro4 Brussels 2018: Ban of Diesel < Euro 2 2020: Ban of Diesel < Euro 4 2022: Ban of Diesel < Euro 5 2025: Ban of Diesel < Euro 6 Oxford 2020: All ICE ban in city center Amsterdam 2017: Ban of Diesel < Euro 3 2018: Ban of Diesel taxi built < 2009 Oslo 2017: Ban on diesel when high pollution 2019: Ban on private cars in city center Netherlands 2030: All ICE ban France 2040: All ICE ban India 2030: All ICE ban South Korea 2030: All diesel ban Announcement not confirmed /planned Measure confirmed / planned UK 2040: All ICE ban

France and UK announced in 2017 their willingness to ban ICE sales in 2040, on top of local authorities who also developed plan to meet pollution norms with the ban of the most polluting vehicles strengthening year over year

Barcelona announces ban from 2019

30% 40% 50% 60% 70%

France Germany Italy Spain United Kingdom

Diesel car penetration

• %, September 2014 to December 2017-

Paris & Madrid announce 2025 ban Stuttgart announces diesel ban in 2018

VW Dieselgate

Paris announces 2020 ban Munich, Cologne and Berlin considering diesel ban Source: CCFA, KBA, SMMT, Faconauto, ANFIA Germany plans emission stickers Hamburg proposes diesel ban Oxford announces ICE ban from city centre in 2020

Announcement of local diesel ban already impacted diesel market share across Europe and are likely to be a strong driver for Electric Vehicle sales

Berlin  Diesel = 98% of LCV London  Diesel = 97% of LCV Milan  Diesel = 91% of LCV Paris  Diesel = 92% of LCV

If PC drivers have many alternative to diesel – gasoline, HEV, LPG, BEV, PHEV - the choice is much more limited for LCV drivers where diesel represent more than 90% of fuel mix with BEV & NCG being the only alternatives

Electric Vehicle Demand Range Sensitivity

• Interview of 50 Fleet Managers conducted in 2009 -

0% 20% 40% 60% 80% 100% 200 km 150 km 100 km

EV Fleet Penetration

• Typical range demand of a Small & Basic PC or LCV is around 150 km.
• As the new Kangoo ZE currently offers 120 to 200 km real driving range depending on

driving conditions, 20 to 60% of fleet drivers could be interested by a Kangoo PHEV

Driving Range on a Single Full Charge

Source: Frost & Sullivan 2009

120 km

Fleet managers are very sensitive to driving range as the potential EV penetration drops from 80 to 40% when the driving range drops from 200 to 120 km, which are the current real driving range boundaries for the Kangoo ZE

More Roads Smaller Cars Less Cars More People per Car

Electrification is only one part of the answer to our mobility challenges Reducing car size and weight, filing them with more people and sharing them are the other part

Evolution of Corporate Mobility Business Models Fuel Card Payment Card Mobility Card Mobility Budget Integrated Mobility Private Ownership Shared Mobility Use Based Allowance

Source: Frost & Sullivan

Will Business Users Adopting Shared Mobility? Although company car is still “king” in the short term, there is an increasingly higher levels of interest amongst businesses for corporate car sharing and car pooling

Nicolas Meilhan

Principal Consultant Energy & Transportation Practices (+33) 1 42 81 23 24 nicolas .meilhan@frost.com

Thank you for your attention!

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Road to net zero emissions by 2030

Matthew Walters, LeasePlan UK Head of Consultancy Services

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How can you lower the emissions of your fleet?

Top 7 findings that are expected to influence EV passenger car market

Over 80 BEVs (50+% from China) and 100+ PHEVs are either announced or speculated to be launched in the next 3 years Emergence of New and Modular platforms for EVs that comes with connected and autonomous architectures. Ex: MEB -VW; SPA

• Volvo; EVA – Mercedes, etc

Battery Price to potentially go down to $200/kWh in the next 1 year and to $130$/kWh (or less) by 2020 Rapid reduction in price of the battery making a 300 mile BEV a standard? About 25 BEVs with minimum 200 miles range announced or speculated in the next 4 years Ultra-fast Charging is the next wave: about 400 ultra fast chargers planned in Europe that can juice 200 miles of electricity in 10

• minutes. About 220,000 charging point network expected in Europe by 2020 (from ~110,000 points right now)

Most Automakers have made announcements of going electric. GM plans to introduce 20 all electric vehicles by 2023, Ford with 13 models, JLR by 2020, Volvo 5 models between 2019 to 21 and palns to electrify all the models, VW group with vision 2030 Global market of xEV (incl. hybrids) have a potential to reach 20 million by 2025 in a baseline scenario. BEV+PHEV sales for the first time expected to hit 1 million in 2017

GLOBAL ELECTRIC VEHICLE OUTLOOK: KEY FINDINGS, GLOBAL, 2017

Source: Frost & Sullivan

Convergence

Exciting New Business Models

Electric Vehicle

Step Up Value EV1 Step Up Value EV2 Step Up Value “n”

Cost Affordability

Connectivity

Step Up Value C1 Step Up Value C2

Technology Increasing need to be autonomous

Autonomous

Step Up Value A1 Step Up Value A2 Step Up Value “n”

Flexibility On-demand

Connectivity

Power Net Safe E/E Architecture P/F Strategy Evolution

Electric

Mega Trends Influence on drivetrain

Autonomous

Influence on self- driving features on vehicle Interior / Exterior

Source: Frost & Sullivan

xEV BREAKDOWN BY REGION (BASELINE SCENARIO ESTIMATES), 2025

xEV Breakdown by Region – 2025

48V mild hybrids and PHEVs is likely to be key technologies adopted in EU, while government in China is pushing electrification of vehicles. Full hybrids are likely to be standardized across model in Japan by 2025 24% 37% 23% 16% 32% 20% 23% 25% 13% 68% 16% 3% 12% 5% 69% 14% 38% 11% 27% 24% PHEV FHEV MHEV BEV NORTH AMERICA 4-6M? EUROPE 6-9M CHINA 7-11M SOUTH KOREA 0.4-0.8M JAPAN 3-4M

Note :All figures are rounded. The base year is 2015. Source: Frost & Sullivan

Serious alternative solutions are at the horizon

Electric vehicles show improvements in:

• Range
• Charging infrastructure
• Vehicle choice

Electric vehicles are well positioned

• No tail pipe emissions
• Dust-to-dust comparison Electric/ICE show 26% - 43%

less CO2 in favour of the electric vehicle ‐ With conventional electricity production (coal)

• Sales figures are expected to increase to 20 million

vehicles globally by 2020

• It’s one of the main strategic directions from OEMs

Source: IEA, Global EV Outlook 2017 & TNO 2015 R10386

Global EV Market Overview

Top 10 PHEV and BEV

Source: Frost & Sullivan

50,277 43,700 43,401 31,898 25,659 18,667 18,375 17,296 16,488 15,467

BEV PHEV Tesla Model S Nissan Leaf Mitsubishi Outlander BYD Qin PHEV BMW i3 Renault Zoe BYD Tang VW Golf GTE BAIC E-Series Zoyte Z100

2016 2017 2018 2019 2020 2021

Total no. of Launches

Source: Frost & Sullivan

16 6 7 4 2 3 21

BMW Daimler PSA Ford Geely GM VW Group

Rolls-Royce Phantom 5 Series PHEV 7 Series PHEV Mini Clubman 740 Le Xdrive Mini Countryman Bentley Bentayga i8 roadster i9 1 series Mini Spacebox BMW X series PHEV BMW M3 PHEV 3 series GT 4 series I6 (Autonomous) AMG GT E Class ML GLC CLA C Class Citroen DS5 Peugeot 308R C-Compact A-Basic D-Midsize Unknown Unknown Aston Martin Electrique Raipide Linkoln MKZ Ford Kuga Ford Mondeo Volvo S90 Volvo V60 Cadillac CT6 Chevrolet Orlando Opel Insignia Audi A3 etron Porsche Cayenne 7 Series PHEV VW Passat Seat Leon Audi Q7 VW Tiguan GTE VW Polo Audi Q1 Porsche Macan VW Touran VW Jetta Audi R4 Roadster Seat Ibiza Audi Q7 etron Audi R8 VW Passat Bentley Bentayga Skoda Superb Audi A3 Porsche 911 Seat Leon

Global xEV market overview

xEV-SUV Market: Key Models Launch Roadmap, Global, 2013-2025

Note: The above list is indicative rather than exhaustive Source: Frost & Sullivan

2013-2015 2016-2018 2019-2025

2013 - 2015 2016 - 2018 2019 - 2025 Electric Plug-in Hybrid Mild & Full Hybrid

BYD Tang Mitsubishi Outlander Volvo XC 90 T8 Hybrid Mercedes GLE 550e BMW X5 eDrive Porsche Cayenne SE Hybrid KIA Soul EV Toyota RAV4-EV Range Rover Hybrid Lexus RX450H Audi Q5 Hybrid Infiniti QX60 Hybrid Subaru Crosstrek Hybrid Nissan X-Trail Hybrid Tesla Model X Range Rover Concept EV Audi Q6 e-tron Bentley Bentayga Hybrid KIA Sorrento Hybrid Volkswagen Tiguan GTE Mercedes GLC 350e Volvo XC60 Audi Q7 e-Tron Ford S-Max Hybrid BYD Song Toyota RAV4 Hybrid Lexus NX Hybrid KIA Niro Hybrid Nissan Murano/ Rouge Hybrid Jeep Wrangler Hybrid Range Rover Concept PHEV Rolls Royce Cullinan

Range enhancement from OEMs

Range enhancement from OEMs

New Technology, New Performance

New Technology, New Performance

Wireless Charging (AWC)

Majority of the drivers is likely to choose a low emission vehicle as next car

Source: LeasePlan, Mobility Monitor 2017

• 52% of respondents is ready to make a green move
• N = 5.994

VW Golf TSI VW Golf GTE

EV growth

500,000 1,000,000 1,500,000 2,000,000 2,500,000 3,000,000 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 ICE EV Shared Platform EV Specific

xEVs to reach 50% of new car registrations by 2027 Still a predominance of shared platform models – ICE/Hybrid/PHEV/EV

Source: LeasePlan Consultancy Services

Pure EV attributes

Aerodynamics Distinctive styling Safety structure Charging capability Weight distribution Weight reduction Battery conditioning

Product evolution

2nd Generation EVs

Limited range means products aren’t comparable Rapid change in technology, especially battery life Heavy discounting on early schemes Complicated ownership models – battery leases etc

1st Generation EVs

Big brands announcing and launching products Low discounts improve short-cycle RVs Increasing clarity on city centre pollution zones Battery ranges closer to customer expectations

Whole Life Costs

EVs Total Cost of Ownership is starting to become attractive

 Hybrid  Petrol  Diesel  Electric

TCO in certain markets already lower than diesel equivalent Norway: Strong fiscal incentive investment value Netherlands: Strong Benefit in kind incentive Other markets expected to follow; this is the right moment to consider EVs in the fleet

Source: LeasePlan Consultancy Services

Comparison of indexed monthly costs including fuel of C-segment vehicles in The Netherlands (48 months / 30,000 km) Comparison of indexed monthly costs including fuel of LCV-medium segment vehicles in Norway (48 months / 30,000 km)

Fleet Balance

Whole Life Costs - A lot to think about

The rise of EV & PHEV requires new thinking on Total Cost of Ownership / Whole Life Costs

£84 £104 £34 £63 £0 £100 £200 £300 £400 £500 £600

Diesel EV PHEV - 45 mpg PHEV - 140 mpg Rentals RMT Insurance Employer's tax on benefit Business fuel Electricity

£447 £483 £514 £444

General TCO Specific to EV/PHEV Absolute cost or NPV VAT recovery rate Fuel cost (YoY) Private use contribution Business/private fuel split Insurance cost Tax relief Electricity costs (YoY) Pence per mile Miles/kWh PHEV fuel cost calculation Average fuel economy Split electric/ICE Fuel efficiency Reimbursement for electricity Source: LeasePlan UK Consultancy services

Real examples

Diesel

BMW 320d

£639

BMW 120d

£569

VW Golf 2.0d

£529

VW Golf 1.6d

£461

EV

BMW i3

£551

VW e-Golf

£520

Renault Zoe

£517

Nissan Leaf

£461

Comparative whole life cost

BMW 120d VW e-Golf Whole Life Cost £569.44 £519.97 Monthly Rental £430.69 £478.06 Sum of VAT recoverable (total)

• £71.78
• £79.67

Sum of VAT blocked £35.89 £39.83 Sum of Tax relief (total)

• £73.61
• £81.72

Sum of Maintenance cost £87.39 £69.39 Sum of VAT recovered on maintenance

• £14.56
• £11.56

Sum of Tax relief on maintenance

• £13.58
• £10.78

Sum of Insurance cost £41.67 £41.67 Sum of Tax relief on insurance

• £7.78
• £7.78

Sum of Class 1A NIC on car benefit £84.17 £42.50 Sum of Tax relief on NIC

• £15.69
• £7.92

Sum of Cost of business fuel reimbursed £127.81 £0.00 Sum of VAT recovered on fuel cost to company

• £21.31

£0.00 Sum of Tax relief on business mileage cost (and AL)

• £19.86
• £11.00

Sum of Electric charging for business mileage reimbursed £0.00 £58.94

The Electric Vehicle Proposition is no more about just driving range although this is still a prime concern. Manufacturers are investing in a wide range of vehicles Long term evolution is a certainty xEV Whole Life Costs are starting to make sense Part of a sustainable fleet policy with a mix of the right vehicles

1 2 3 4 5

Making the switch

79

Ultimately, all that’s required for most companies to adopt low-emission fleets is a decision from the top. So what’s next? The executives attending Davos simply need to say “we will make the switch”. No change of strategy is required. It can be done with the stroke of a pen.

How to make the switch to a 100% clean fleet

High level process flow to implement an EV fleet Ongoing communication

• 1. Prepare
• 2. Plan
• 3. Business case
• 4. Solution
• 5. Implement
• 6. Monitor

Are you ready and is your organisation ready to transition to EV/AV?

Align to the overall strategy of the organisation Stakeholder involvement & alignment Baseline, emission footprint & benchmark Sense of urgency – business continuity because

• f city bans / diesel blocks

Market readiness, vehicles, services, fiscal structure

Ongoing communication

• 1. Prepare

Plan Business case Solution Implement Monitor

preparation

A clean fleet requires cooperation and an aligned strategy

Fleet sustainability

The business HR C-level Fleet manage- ment HSE

Corporate strategy CSR strategy Fleet strategy

Fleet & safety Sustainability

Reduce CO2 emissions Introduce an EV approach Ensure driver mobility

Growth Leadership

Through benchmarking you know where you stand and what other possibilities are next

• Industry peers are all global IT service

companies

• Scope: AT, BE, CH, DE, DK, ES, FI,

FR, IT, NL, NO, SE, UK

• Total distribution of the industry

peers are:

77% Diesel 20% Petrol 3% Electric

Industry peers include petrol and electric in their fleet

Benchmark fuel distribution, client compared with industry peers

Benchmark client 3 Benchmark client 2 Benchmark client 1 Client

Source: LeasePlan Consultancy Services

Government policy on low emission fuels will strongly influence the ability to introduce an EV fleet

• Reduction on employer NIC tax (benefit of the car)
• Depending upon EV/PHEV ranges government grants of up to £4500 are available
• A grant of up to £500 towards a home charger installation
• London congestion charging exemption
• A number of cities are in line for LEZ and ZEZ by 2025
• Free/subsidised parking;
• Removal/Reduction in Residential and business parking permit charges

Ensure clear objectives and an informative decision making process

Ongoing communication

Prepare

• 2. Plan
• 3. Business case

Solution Implement Monitor Agreed project plan Objectives, scope, timing, resources Informative business case EV options, charging infrastructure & invoicing, change management Impact on: Organization, CO2, Cost, Employee satisfaction Stakeholder meetings

Plan and deliver insight

Make sure the solution is tailored to your

• rganisation and vehicle use

Tailored recommendation fit to your fleet Benefit fleet Tool fleet

Ensure a tailored solution

Leader

• EV focused policy
• Introduce flexible

solutions to be ready when suited EV’s arrive

• Engage your drivers
• Realise charging

facilities at work locations

Transformer

• Include EV mobility

in the car policy

• Introduce flexible

fleet solutions to be ready when suited EV’s arrive

• Engage your drivers
• Realise charging

facilities at work locations

Starter

• Include EV sharing in

the car policy

• Realise charging

facilities on work locations

• Engage your drivers

to EV sharing

Ongoing communication

Prepare Plan Business case

• 4. Solution

Implement Monitor

Take sufficient time to implement and involve stakeholders for support

Communication, benefit statement, driver engagement Realise charging facilities at work locations Select a hassle free e-Mobility service Vehicle delivery, charging infrastructure, EV management Adjust company car policy

Implement

Ongoing communication

Prepare Plan Business case Solution

• 5. Implement

Monitor

As a ‘clean’ fleet is part of your strategy, you better monitor and report on results

Emission footprint development EV penetration, results for your Annual report, CSR reports Monthly driver pulse checks Satisfaction rates & issue tackling

Ongoing communication

Prepare Plan Business case Solution Implement

• 6. Monitor

Monitor

Barriers to Adoption

Rapid development in technology Charging infrastructure, at home, work or public Pre-occupation with occasional high mileage journeys Concern over future used values Lack of used vehicle outlets Battery longevity Reliance on main dealer servicing Potential cost of components Vehicle Availability

Smart leader: Adapt to electric mobility

Transform the car policy to an EV focused policy Introduce flexible fleet solutions to be ready when suited EV’s arrive Engage your drivers to EV mobility Realize charging facilities at work locations Monitor that your EV goals are met Show policy improvements based on market developments Day to day advice on the best EV and best charge solution Charge everywhere hassle free Connect the EV mobility future to your strategic goals Show impact of low emission legislation on your business Match your current fleet to EV counterparts Consult on business changes to speed up EV transition Your future Get ready Lets travel LeasePlan’s end to end EV solution Start Decision 1 2 3

How can LeasePlan help lower the emissions of your fleet?

Our clear focus helps you in achieving your sustainability target

• EV Center of Excellence, providing advice to our

customers on what’s next in low-emission vehicles

• End-to-end EV proposition for corporates, making it

easier for customers to make the switch

• Corporate Net Zero Scan, helping our customers

understand their emissions performance vs global benchmark

• Founding partner EV100 initiative, supporting leading

global corporates who want to switch to EVs

LeasePlan Electric Mobility All-inclusive e-driving at your convenience

• Providing an e-mobility solution instead of

just vehicles, taking into account your strategic and operational goals

• Take away hurdles and concerns with

regard to driving an EV

• Provide active support to fleet managers

for replacing ICE cars with EV’s

• Compelling TCO results

LeasePlan’s new solution in delivering e-mobility

All-inclusive e-driving at your convenience includes

End-to-end solution Driver tools Services for clients

LeasePlan Driving Electric

EV proposition

Our EV packages

Office Charging Pack Office Charging Plaza Shared e-fleet LP e-mobility card Vehicles Home charger

6.7 -11kw (3 ph) 22 kw 75- 150 kw

Nissan LEAF 2018 Source: Faraday Keys

Charge cable mode 2 charging AC wall box 6.7 – 11kw (3ph) DC wall box 22kw AC DC charging station 75 – 150 kw Home smart AC 4-6 hrs Office load-balanced 4-6 hrs Home DC 2 hrs Fast on the road 160 km in 24 min Nissan Leaf 2018

It’s all in the charging

• Ordering
• Installation
• Driver support (e.g. reimbursement)
• Mileage and electricity reporting

Supported via an e-mobility portal

Roll-out

2 2018 Q1

Germany, UK, France & NL 2018 Q2 Norway, Belgium, Portugal 2018 Q2.5 Spain, Italy, Sweden

White papers

10 3

Road to net zero emissions by 2030

Wrap-up

105

What we know…

Sustainability and improving air quality are dominant themes Business mobility has an important role to play There are now alternatives to the internal combustion engine EVs Total Cost of Ownership is starting to become more attractive Most drivers are likely to consider a low emission vehicle as their next vehicle

106

What’s next?

Take a serious look at EVs for your business Review your fleet policy and whole life cost Establish which segments are ready for a change Make the first step

107

How can LeasePlan help?

EV Proposition EV on LeasePlan Flexible Specific EV Event / Conversations Further Schedule of EV Events Net Zero Scan 360 Formula Policy Support Guidance & Expertise