Written evidence from Turo (ELV0113)

Turo Submission to House of Lords Environment and Climate Change Committee Electric Vehicle Consultation

Turo strongly welcomes the House of Lords Environment and Climate Change Committee’s inquiry into electric vehicles (EVs) and is grateful to have the opportunity to provide evidence.  

By way of background, Turo is the world’s largest car sharing marketplace, with a mission of putting the world’s 1.5 billion cars to better use. Turo unlocks the hidden value in idle and underutilised assets, empowering anyone to get in the driver’s seat. Users can book any car they want, wherever they want it, from a vibrant community of trusted hosts. Turo allows car owners to share their own cars to generate extra income.

Smarter, more efficient use of resources is at the very core of the Turo marketplace. Turo is proud to be the first carbon neutral certified car sharing marketplace to commit to carbon neutrality. We’ve seen our platform help to reduce car ownership and encourage electric vehicle adoption, and by investing in carbon offsetting, we are helping to further promote a positive environmental impact while empowering our community with the confidence to travel and share their cars responsibly.

On the Turo marketplace, as of June 30, 2023, electric vehicles represented 8% of Turo vehicle listings. Specific to the UK, as of December 2022, 10% of the unique makes and models on the UK platform are EVs.

We have answered a number of questions within the consultation that we as a businesses feel qualified to respond to, but a summary of key policy considerations we believe are vital to improving the take-up of Evs and experience of consumers is included below:

•          Introduction of a national “shared mobility week”, where people are encouraged to use shared forms of transport. Cost, health, climate and congestion benefits can be promoted.

•          Introduction of a national scrappage scheme for vehicles to encourage reduced car ownership and better use of remaining cars. Scrappage credits can be awarded which can be used towards shared mobility platforms.

•          A “rent-a-room scheme” type allowance should be created for sharing personal vehicles to provide an incentive to encourage people to put cars to better use. The Rent a Room Scheme lets those letting furnished rooms earn up to a threshold of£7,500 per year tax-free.

Government approaches

3. What specific national policies, regulations or initiatives have been successful, or have hindered, EV adoption to date? Are these policies or initiatives fit for purpose?

Efforts to expand the public charging infrastructure network have been successful in mitigating one of the key barriers to EV adoption - range anxiety. Continued investment in charging infrastructure, particularly in rural and less densely populated areas, is crucial to maintain momentum in EV adoption. 

However, the existence of multiple charging standards and connectors has created               confusion               and               inconvenience               for               EV               owners. Standardisation in charging infrastructure is necessary to simplify the user experience and facilitate faster adoption.

Our data at Turo shows that electric vehicles accounted for 14% of the company’s overall gross booking value in 2022 illustrating that there is public demand for the use of EVs and we feel strongly that Government should utilise this and incentivise the adoption of EVs. 

4. Given that the Government should apply a behavioural lens to policy—which involves

people making changes to their everyday lives, such as what they purchase and use—is there a role for clearer communication of the case for EVs from the Government? If so, who should take the lead on delivering that?

There is certainly a need for clearer communication from policymakers regarding the benefits of switching to an EV in the UK. EV adoption involves not only a shift to improve infrastructure, such as charger rollouts and the standardisation of chargers, but also a significant change in consumer behavior. 

Many consumers may have misconceptions, concerns, or simply a lack of awareness about the benefits of EVs. Clear and persuasive communication from Government can dispel misconceptions, highlight the benefits of EV usage and provide information about inventives or charging rollouts. 

One of the benefits of guests using an EV for the first time on Turo’s platform is that they can experience using and ‘owning’ an EV without the cost of purchasing one, allowing them to ask the host questions on how to use the car, find their nearest charging station and decide on whether the move is right for them. 

If the Department for Transport can highlight and showcase electric vehicles on peer-to-peer car sharing marketplaces through a ‘shared mobility week’, more people can be encouraged to make the transition.  

7. What are the likely costs that will be faced by consumers as a result of the

Government’s

phase-out dates for non-zero emissions vehicles? Are there policies or initiatives that the Government could use to specifically target barriers arising from unpredictable costs to the consumer, for example significant fluctuations in the cost of electricity, changes to road taxes, or the introduction of low emission zones?

As we transition to an EV-focused market, it is essential that Government protects consumers from unpredictable costs resulting from such a move. 

We believe that one way of off-setting finanical risk for consumers during the transition period is via the introduction of a national scrappage scheme for vehicles to encourage reduced car ownership and the better use of remaining cars. These

scrappage credits can be awarded which could be used towards shared mobility platforms such as Turo or other peer-to-peer car sharing or shared mobility services.

EV Market and Acquiring an EV

8.   What are the main routes for acquiring an EV? Which aspects of these routes are working well, which aspects could be improved?

A key route of EV acquisition that we believe is often forgotten is that of peer-to-peer car sharing. Platforms like Turo allow consumers to test drive EVs in real-world conditions before making a high-cost purchase decision. Consumers can assess how an EV fits their needs and lifestyle, overcome range anxiety perceptions, assess the cost of ownership and gather insights and ask questions of EV owners who host the vehicles.

Peer-to-peer car sharing is the secret weapon for EV expansion by providing an opportunity for extended test drives. Turo over-indexes on alternative energy vehicles, with 11% of active vehicles on our UK platform being run on alternative energy (through the year 2022), as opposed to the 3% of the total vehicles on the UK roads.

All this can be done whilst providing the consumer with a flexible, convenient and accessible route of EV acquisition, whilst also encouraging resource-sharing and overall EV vehicle ownership. 

9.   What are the main consumer barriers to acquiring an EV, either through purchasing, leasing, or other routes?

We believe there are three main barriers to the growth of the EV market, all of which can be addressed through our platform. 

1)      High cost of EVs

New EVs often have a high upfront purchase cost compared to traditional internal combustion engine vehicles, even when taking incentives into account. Turo provides consumers with the ability to test EVs prior to purchase, ensuring they are happy with the decision they make. Consumers can then offset the cost of their EV by listing it on the Turo marketplace, generate income from sharing it, and reap the economic benefits of peer-topeer car sharing. Turo has actively participated in efforts to provide additional economic incentives for UK residents to share their EV.

2)      Range anxiety and perceived concerns

With EVs still seen as a novel technology, many consumers have misconceptions and concerns around running out of charge, the lifespan of EVs or the cost of upkeep. By educating people on the traditionally lower operating costs, the reduction in emissions and the incentives available, Government can reduce a key consumer barrier to EV acquisition. Peer-topeer car sharing platforms such as Turo are then able to provide a hands-on experience to complement this education campaign, by providing consumers with a low-cost alternative to EV ownership. 

3)      Charging infrastructure

The UK’s relative lack of convenient and reliable charging stations outside of urban areas is a massive barrier to mass EV consumption. By standardising the network and building an efficient and extensive charging network throughout the country, consumers will be more likely to purchase an EV, or if renting a vehicle, more likely to try an EV. Currently, it is our assumption that this would not likely be the case if someone lived or was travelling rurally. 

10.            How is the Government helping to ensure that EVs are affordable and accessible for consumers, and are these approaches fit for purpose?

It is clear that incentivisation is the best way of encouraging a transition in the market. Efforts such as plug-in car grants, the EV chargepoint grant and tax incentives for company cars all contribute to making a transition more affordable and accessible.

We would recommend that Government expands and builds on schemes such as these to promote EV adoption to consumers. By continuing to monitor and adjust policies and incentives based on consumer data, Government can support the growth of EVs in the UK as the market evolves.

11.            Do you think the range of EVs on offer in the UK is sufficient to meet market needs? Which segments are under-served and why? Why is the UK market not seeing low cost EVs, particularly in comparison to China?

For a full transition to an EV-dominated market, there needs to be a range of offerings and extensive variety of what EVs are on offer in the UK market. This will most likely happen with time and further innovation, but we would like to see affordable entry-level EVs and smaller EVs more suitable for urban environments enter the market. 

The UK is most likely not seeing low cost EVs in comparison to China mainly due to economies of scale. China already has a huge domestic battery production sector, so the domestic market is significantly cheaper. When coupled with grants and better urban charging infrastructure, it’s clear to see why the Chinese market has boomed as much as it has.

15.            What barriers are there to achieving a sufficient supply of second-hand EVs, mindful that second-hand vehicles make up a high proportion of all vehicles purchased?

The main barrier to achieving a sufficient second-hand EV market right now is the outdated nature of older EV models, with lower ranges and archaic technology limiting their appeal to consumers. As we progress throughout the decade and the EV market matures, we should see a much better EV penetration of the second-hand vehicle market, but Government action to accelerate this would be welcomed.

16.            What is the value and role of alternative transport models such as car clubs and micro mobility vehicles in the Government achieving the 2030 phase out date, and how should the Government consider their roles and opportunities for use in transport decarbonisation?

Alternative transport models such as Turo help to put the world’s current cars to better use and help to promote EV adoption so future cars are sustainable. 

As focus increasingly shifts to more sustainable methods of transport, peer-to-peer car sharing provides an exciting opportunity to decrease congestion in city centres and provide flexible methods of transport, moving away from a focus on car ownership. We feel that significant opportunities exist for this sharing economy model to support a decarbonisation agenda and would be keen to collaborate with Government on this.

Experience of using an EV

18.   What are the main challenges that UK consumers face in their use of EVs?

Despite having a plethora of benefits and exponential growth in the sector, implementing EV adoption is still extremely challenging. 

Primarily the upfront high initial cost of EVs is a substantial obstacle. Coupled with battery anxiety, charging infrastructure, and unfamiliar systems, there are obstacles that need to be addressed by Government in order for the public to begin transitioning to EVs en masse.

19.   What are the main benefits that UK consumers could realise from using an EV?

Outside of the obvious environmental benefits such as reducing our reliance on oil (and thus improving our energy security), a shift towards EVs will bring multiple benefits to UK consumers. 

EVs are far cheaper to operate than traditonal vehicles, with low fueling and maintenance costs a key bonus for consumers, plus cheaper vehicle tax. Often EVs can access free parking, don’t have to pay congestion or low emission zone charges, and hold their resale value far better than normal cars, offering a better investment to a consumer. 

By listing EVs on Turo’s platform, consumers can also realise further financial benefits, enabling them  to generate a passive second income and better utilise an expensive asset.

National and regional issues

32.            What are the issues facing rural residents, urban residents, and sub-urban residents and how do they differ?

The high cost of EVs remains a critical issue facing rural, ubran and sub-urban residents. Through offsetting the high cost of an EV by sharing it on peer-to-peer car sharing platforms, this obstacle is largely removed.  Additionally, the main concern seen by all groups is that of charging infrastructure and battery anxiety. To fully

transition the UK car market towards EVs, these issues need to be addressed through investment and resource allocation. 

Each group will have separate issues around parking availability, commuting distances etc, but the overall indication is that to encourage EV adoption across any and all regions, targeted policies need to be introduced alongside extensive investment in charging infrastructure. 

33.            What role do you see local authorities playing in the delivering the 2030 phase out target, particularly in relation to planning regulations, charge points and working with District Network Operators? How can government best support local authorities in their roles?

Our experience in this area indicates the need for local transport plans to go beyond the traditional model of provisioning EV infrastructure to redesigning the way we use cars in the first place. 

If peer-to-peer car sharing is recognised and implemented by local authorities into local transport plans, they can push to reduce vehicle ownership, reduce emissions, reduce congestion and improve vehicle utilisation; all key targets of local authorities as we push towards the 2030 phase out date with more and more sustainability goals rightly bestowed upon councils.

International perspectives

34.            What are the successful approaches to the rollout and uptake of EVs in other countries, and what can the UK learn from these cases?

Tasmania offered a credit of $1,000 by the state government to individuals who share their private vehicle, including electric vehicles, through a Hire and Drive Reimbursement Program. The $1 million scheme enabled car owners to cover their vehicle registration costs while also reducing the costs of hiring a holiday car and increased mobility options for residents and tourists alike.

In the United States, the federal government’s tax credits for the purchase of such vehicles have the most significant effect on vehicle ownership because they have the biggest impact on the price that consumers pay.  Additionally, vehicle demonstration projects aimed at helping to educate consumers about the viability of electric vehicles, have a significant impact as they stimulate consumer demand.

Norway provides generous tax and credit incentives for the purchase of EVs. In December 2022, more than 80 percent of new cars purchased in Norway were electric. However, there is concern regards to the strains of the rapid growth of EVs without having corresponding investments in EV charging infrastructure. Following such an approach of rapid EV adoption should be met with additional investments in EV charging, including public charging and charging at residences.