The future of EV: Navigating economic and energy shifts in a mixed-fuel world

As 2025 starts to take shape, fleet operators around the world are grappling with both the opportunities and the challenges of transitioning to a mixed-energy fleet. This shift isn’t just about electrifying vehicles. It’s about balancing electric vehicles (EVs), hybrids, and traditional fuels. Balancing them in a way that optimizes costs, sustainability, and operational efficiency.

With the global economy trending downward, evolving regulations, and ongoing technological advancements, we are in a pivotal moment for the industry.

I was recently part of a LinkedIn Live panel where we discussed the future of fleet electrification and how companies are navigating the shift to mixed-energy fleets. I was joined on the stage by my colleague at WEX, Adam Woolway, VP, Global Energy Transition. Also in attendance were Dr. Jose Serras-Pereira, Director, Mobility Advisory, from Frost & Sullivan, and Nick Woolley, founder and CEO of a WEX partner, ev.energy. We discussed the future of mobility as the economy shifts and new technologies become available, starting with the basics. 

Why go electric?

While electrification is a necessary action to lower emissions and contribute to a sustainable earth for generations to come, the more compelling reason for your company may be the way a mixed-energy fleet can improve your bottom line. To understand the effect on your business, we investigated the total cost of ownership (TCO) of an electric vehicle versus that of a traditional internal combustion engine (ICE) vehicle.

What is the total cost of ownership for a commercial vehicle fleet?

Total cost of ownership for a commercial vehicle fleet includes all the little payments you might not pay close attention to, but that build up over time. Of course, there are the expenses associated with acquiring and fueling the vehicle. The hidden costs come with maintaining vehicles over their lifecycle. Repairs and insurance are a few more obvious costs. However, it’s also important to consider how the vehicles you choose affect depreciation and resale values. You also want to look at the affect on administrative costs, driver salaries, compliance fees, and potential downtime. Understanding TCO helps fleet managers make informed decisions to optimize costs, improve efficiency, and enhance profitability over time.

How does an EV TCO compare with an ICE TCO?

A typical electric vehicle might have a 100 kilowatt-hours battery size. That 100 kilowatt-hours when charged during a typical energy rate at peak times in the U.K. might cost approximately 30p per kilowatt-hour. That adds up to about £30 to recharge an electric vehicle. If you charge at the most optimum points in time, then you can significantly reduce that cost. Charging at an optimum time could bring the total cost to under £10 to recharge the full tank of an electric vehicle. With that fuel, you can travel 300 miles. This represents a dramatic shift in cost expectations for a fleet manager. 

During our panel, Dr. Jose Serras-Pereira discussed the potential of electric vehicles for fleet companies. “The big differential between diesel cost and electricity cost is a huge opportunity for fleets. The electricity costs can be 10 to 20% of the cost of diesel. This is a huge component of reducing the total cost of operation when building a mixed-energy fleet.”

One of the largest categories within the total cost of ownership of a vehicle is the cost of fuel. Serras-Pereira highlighted an important component of fleet managers’ decision-making: commercial vehicles using electricity are significantly more cost-effective than vehicles powered by diesel. 

New technology involves optimizing for supply chain, vehicle routing, and general fleet management

You may be wondering how to incorporate electric vehicles into your fleet gradually. You likely already rely on traditional ICE vehicles. It’s valuable to consider how to run a whole fleet effectively while adding EVs into the mix. 

It’s important to consider how to navigate the supply chain, now that you are bringing in electric vehicles. When you manage a fleet of delivery vehicles, deliveries need to be made on time. Executing delivery times as promised is crucial in this line of work. If a supply chain gets disrupted because the wrong vehicle is on the job it might mean the delivery doesn’t arrive on time. The result is a potential impact to that fleet manager’s revenue and key performance indicators (KPIs). 

With this in mind, you may wonder which vehicle should be assigned to which route. There are complex calculations involved. Fortunately, there is technology available that helps a fleet manager manage all the variables. 

Macro trends influencing the cost of electrification and decarbonization

When you’re running a global business, policy changes across various governments and nation states matter. EV incentives and policies differ depending on where your fleet operates. Whether you’re operating in the U.S., Europe, or elsewhere, the decisions you make about which vehicles to adopt will be different. Because of this, fleet managers need to be well-informed. In the U.S., incentives vary state-by-state, European incentives differ from Chinese incentives, and so on. Staying on top of it all might seem overwhelming. However, these incentives need to be a part of your analysis. They provide an opportunity to reduce upfront costs when adopting EVs into your fleet. As Serras-Pereira mentions, “This is where working with partners becomes increasingly important.” The resources, expertise, and insights that partners provide will take the complexity out of EV adoption for fleet managers.

Battery advancement and how the newest technology impacts EV adoption

EVs can’t run without batteries. Most EV batteries come from China, where manufacturers have worked to reduce the costs of batteries significantly in the last ten years. Nick Woolley, Founder and CEO of ev.energy noted the role of the market for electric vehicles in China: “China has had a really big influence on the EV marketplace over the last five to ten years. In 2024, 17 million EVs were sold and about 45% of those sales happened in China.” China’s focus on EV production has driven the volume of electric vehicles into the market. From this influx of electric vehicles come positive forces for change, adoption, and innovation for the EV market. 

The lowered battery price tag has significantly reduced the cost of electric vehicles, as EV batteries are typically 40% of the vehicle’s total cost. “Fleets have options. They have vehicles to choose from that are at price parity or near parity with the rest of their fleet with subsidies and the cost reduction in batteries playing a role,” Serras-Pereira said.

EV market support and advancement drives adoption

At the same time that Chinese battery manufacturers have made battery production more efficient and less expensive, solar technology has become more sophisticated and less expensive to develop. Solar energy supply manufacturers went through a technological learning curve in the last decade. From that learning these companies have adopted a more sophisticated approach. According to the World Economic Forum, “Today’s solar cells–which are typically silicon-based–can convert an average of around 22% of the sunshine they absorb into power. More efficient solar cells mean each solar panel can generate more electricity, saving on materials and the land needed.” This is compared to the 1-2% conversion rate of solar cells when they were first created. This increase happened over several decades, with major breakthroughs occurring due to space study technological advancements in the mid-20th century. 

These technological developments result in less expensive up-front costs for electric vehicles and cheaper EV operations. 

China’s role in EV innovation  

China has emerged as the current leader in EV production, and according to MIT Technology Review, the push to focus on electric vehicles came from the Chinese government. Starting in 2001 there was a strategic decision to shift from ICE to EV, when they realized their auto industry could never overtake traditional car manufacturers in places like the U.S. and Japan. From 2009 to 2022, the Ministry of Industry and Information Technology (MIIT) and the National Development and Reform Commission (NDRC) poured $29 billion in government subsidies and tax breaks into China’s economy for EV technology and infrastructure. There were procurement contracts, policy incentives, and governmental support on lithium battery development. These developments also contributing to the wide-spread embrace of EV innovation. As part of their focus on EVs, the Chinese auto industry created a wide range of EV types available with over 200 brands in China offering EVs.

Addressing data privacy concerns with EVs

As vehicle technology evolves, and with the advent of connected cars, it is increasingly easy to integrate data collection into the make-up of a vehicle. EVs have more advanced technology and sensors. This allows them to produce more data than their ICE counterparts. As a result, commercial vehicle fleet managers have expressed concern about data privacy when adopting EVs into their fleet. 

Electric vehicles generate richer data, and can be aggregated for better decision-making for fleet managers. Access to that data and the use of that data becomes an asset for a large fleet. The data collected by EVs can draw attention to excessive braking, speed, and idling, and can help assess which fueling and charging stops might improve the timeline of a driver’s route. Analysis of this data leads to useful and cost-saving measures.

In an ideal world, that data would be open source and shared with anyone with an interest in managing fleets. Understandably, business leaders may be weary of making their data public. During our LinkedIn live discussion, Woolley talked about how ev.energy is at the intersection of that friction point. “On the one side, we bring in data from telematics, from the vehicles, and from charging stations. At the same time, we are working with energy companies to get data on what’s happening in the energy system. We integrate fleet partner-mined data as well.” Woolley’s business mines that data and compiles it in one place, providing the most advanced data resource for fleet managers and energy managers alike.

Decarbonization in context: You can’t do it alone

In October of 2024, The European Commission reported the biggest reduction in carbon emissions in decades, amounting to an 8 percent drop in emissions from 2022 to 2023. Electric vehicles are rapidly changing too. To allow the fleet industry to capitalize on what it’s accomplished so far, collaboration is key. As Serras-Pereir put it during our LinkedIn Live event, “The innovation ecosystem has boomed over the last five to ten years and it’s time now to start connecting the dots where big partners and innovative start-ups can come together and offer real value to the market.” When small start-ups actively innovating collaborate with larger fleet card and fleet management providers, innovative technologies can be brought to scale.

The uncertainty around burgeoning technologies with the need for consolidation

There has been some uncertainty amongst fleet payments and technology companies with a lot of new businesses launching new decarbonization ideas. The phase we’re in now is one of consolidation where these transformative tech companies are joining forces and collaborating with more established brands. 

Constant change in the electric vehicle market is disconcerting for fleet managers. It’s understandable that as companies build their mixed-energy fleets they want to use technologies built by companies who will be in business for the foreseeable future. If you make changes to how to optimize your routes, how you use the data that’s flowing in from your fleet, and how your payments are processed based on partner recommendations, all of that takes time and resources to set up. Once you set something up in a B2B environment you then want to leverage that investment. When all the tools a partner provides become a part of how you operate, you understandably expect that partner to be around, continue to provide a service, and continue to innovate. When the business you’ve partnered with shuts down, the impact on your company is significant, and can be deeply frustrating. 

Data accessibility and the impact it has on running a mixed-energy fleet

When fleet managers partner with tech companies, the accessibility of data is one of the most important topics. As Serras-Pereir puts it, “Fleets run on tight margins and run complex operations. Any big transition like adopting EVs is going to create some doubts and concerns for them. Mixed-energy fleets will exist for many years for many fleets, and the question of how to optimize their operations, data, and technology will be the key to this transition.” Extracting the cost benefits of adding EVs to a fleet through data analysis will be a big part of that optimization. That data will be an important proof point when fleet managers want to come back to the business and share how EVs are saving the company money.

Electric vehicle technology presented new barriers: start-ups responded and solved those pain points

As EVs became more popular, and as incentives to work with EVs drove companies to purchase more, complications were inevitable. During our panel, Woolley spoke about the way tech companies responded. “The last five to ten years have been characterized by EV solution development to help the industry move forward with a rather nascent technology. We solved specific challenges like ‘How will my drivers charge their vehicles while at home?’ and ‘How do I connect depot charging back to my company’s payments technology?’” For each barrier, a technology company would emerge with a solution. In many cases, each solution was developed by a different start-up. Companies appeared, rushed to solve problems, and innovations materialized.

We’re no longer in the phase of rapid innovation, but instead, we’ve entered a new phase. To help commercial vehicle fleets scale up their EV usage, the start-ups that worked independently to generate solutions to one-off problems are now often incentivized to partner with larger, more seasoned organizations. These partnerships will create the infrastructure needed to allow ideas to reach commercial fleet companies. 

Mixed-energy fleets look pretty different from all-ICE operations. For example, when you introduce EVs into a fleet, a fleet manager needs to be able to account for and reimburse drivers charging at home––80% of a fleet’s charging happens at home. Fleet managers also need to be able to track depot and en route charging, which together make up the other 20% of the money spent on fuel. Fleet companies should be able to track the costs associated with both ICE and electric vehicles all on one platform. Even better: the platform should be connected to a business’s existing payments technology.

Differences between commercial and consumer EV adoption

Fleet managers have a lot of appetite for EV technology and for adopting electric vehicles into their fleets. They see the benefits of EV adoption including total cost of ownership, and meeting environmental challenges and goals. However, a lot of EV innovations started with the consumer in mind as opposed to considering a commercial use for the vehicles. As an afterthought, these innovations were then repurposed for the commercial vehicle consumer. This presents an adoption barrier because a commercial vehicle customer and a consumer have different needs.

In our conversation, Serras-Pereir elaborated, “Tesla started over ten years ago changing the public’s perception of what an EV could do and what it would mean for a consumer. The technology has vastly improved over the last ten years. Originally EVs weren’t really built for fleets because they didn’t yet have what a business needed: the vehicles weren’t there, and the battery technology wasn’t able to deliver the ranges that a business would need. But with all the technological advancement that’s taken place in the last decade, that has changed.” 

While a lot has changed, commercial vehicle fleet managers still harbor reservations about the costs associated with EV adoption. This is why it’s crucial to consider the total cost of ownership, rather than the sticker price on a vehicle. “All the considerations businesses have, need to be put through the lens of total cost of ownership.” Serras-Pereir said. When you take in the bigger picture, the upfront vehicle cost becomes less important, as the cost of maintenance, fueling, and all the other variables already mentioned transform the financial analysis. 

Commercial versus consumer: managing a fleet is a lot more complicated than managing a personal vehicle

When you’re just one person, the calculations of a purchase are far more simple. A consumer can quickly calculate and see the value of an EV when optimizing for cost. For fleet managers, the variables seem endless; the calculation becomes difficult to manage and therefore risky. You’re dealing with multiple vehicles and multiple routes, affected by changing traffic conditions or changing weather patterns. For the fleet manager, the consolidation of data leads to a far simpler calculation. Once the data is accessible, fleet managers can use it to make decisions that will set their business apart.

With a mixed-energy fleet, some vehicles will continue to go to the pump and load up on diesel, while other drivers will need data and direction on charging. Businesses are not going to change the make-up of their fleets to 100% electric overnight, so adjusting to this reality is necessary. 

Digital innovation trends in the electric vehicle market

Fleet managers have had to deal with a lot of complexity as EVs have taken hold. At the same time, businesses have a keen interest in saving money, which they know is a real possibility if they successfully build a mixed-energy fleet. 

Fleet managers are already using telematics to optimize operations, track fuel costs, manage warranties, and preemptively manage vehicle servicing needs. With electrification, the data multiplies. Where should your drivers charge? How much will it cost? How long will it take? With the right software collecting all of that data and more into one central location, difficult or complicated questions become simple and highly efficient. Who to entrust with this responsibility? Making the right investment in a partner is an important step in the process.

What is EV digital technology?

In electric vehicle charging the term “digital” refers to the technology used to optimize the charging process. Digital includes features like intelligent load balancing, real-time charge status monitoring, user authentication, and communication between the charging station and the vehicle. For the charging experience, digital can play a role in concurrently simplifying and optimizing the experience for users. Both telematics and the data used to optimize for the energy grid are part of the EV technological experience. As Wooley describes it, “With digital technology, we can link that all automatically and ensure that those electric vehicles are charging at the right times for the energy system. This will allow refueling using the cheapest and greenest energy that’s available on the grid.” 

What is vehicle-to-grid technology?

Digital technologies like “vehicle-to-grid (V2G)” are currently being developed which connect vehicles to the power grid. While connecting EVs to the power grid, V2G technology at the same time allows EVs to return electricity back to the grid. This will create a new value for the entire global energy system and help us unlock faster decarbonization globally. 

This vehicle-to-grid technology also brings with it energy optimization for the business as a whole, not just for the vehicle. Here’s an example of how that might work. If you have a depot for charging onsite at your facility, you can lower overall energy costs for your business and at the same time monetize the energy you’d be contributing to the grid. Fleet managers and the financial branch of the company will need to communicate about this process, and to collaborate with other branches of the business to best capitalize on the grid’s capabilities.

Can the grid handle an influx of EVs?

The short answer is yes. When we refer to “the grid,” what we’re talking about is a complex network of power plants, transmission lines, and distribution lines. They deliver electricity to consumers. The grid is managed by regional entities called “grid operators.” Grid operators monitor and control the flow of electricity across the system and ensure a stable supply to homes and businesses. In the U.S. the grid is overseen by the Federal Energy Regulatory Commission. 

While there is a lot of concern and debate on the topic, if introduced thoughtfully, the grid can handle more EVs. This is because there are other innovations occurring concurrently that will help the grid keep up with EV adoption. We are decarbonizing our energy system at the same time that EVs are becoming more prevalent. We’re replacing coal and gas-powered generation with wind and solar energy. We’re adopting more wind generation, and creating energy from that and from more solar generation as well. More batteries are also being used to generate energy. Wooley elaborates, ”The fundamental challenge with wind and solar energy is that that kind of power is only available when the wind is blowing and the sun is shining.” Grid operators cannot rely on just wind and solar. The potential that needs to be explored and adopted is for fleets to use energy demand flexibly and match EV charging with the availability of wind power and solar energy. This will allow us to balance the grid, and allow us to accelerate EV adoption and the decarbonization of transportation and of the energy system all at the same time.

Not all energy powering the energy transition is green: should we be concerned?

Serras-Pereir points out that a criticism of electrification remains that “Unless the charging energy is 100% renewable, then you have lifecycle emissions that are still not worth the effort.” Lifecycle emissions are the total emissions associated with a product or service from its raw materials extraction to its end-of-life disposal. Many studies including research from the International Council on Clean Transportation (ICCT), the Union of Concerned Scientists, and various universities have been conducted on the topic. The consensus now is that even if you had a coal-fired grid and you charged electric vehicles there you would still be in a better place than were you to drive ICE vehicles. 

EVs are still far better for the environment than ICE vehicles are. One reason is that the electric motor runs at 90% efficiency. Its ability to transform electricity into power is much higher than a combustion engine. The efficiency of an ICE vehicle sits at around 30-40%. The technology powering an EV is much more efficient than that of an ICE vehicle. 

Wooley adds, “We’re decarbonizing fleets while at the same time the electricity industry is also decarbonizing.” He points out that because we’re doing those two things in parallel we can consider when charging should happen and ensure that we charge when it is best for the grid and for the environment. We should do the most charging when wind and solar are at an optimum level so we can charge using the greenest form of energy on the grid. The long-term trend, as a result, is that we’re going to put more and more energy into the grid. This kind of symmetry and thoughtfulness, if it can be agreed upon and carried out, provides hope for the future of EVs and for the future of decarbonization.

Conclusion

The transition to a mixed-energy fleet is no longer a distant future—it’s happening now. As fleet managers navigate economic shifts, evolving regulations, and rapid technological advancements, the key to success lies in strategic planning, collaboration, and leveraging data-driven insights. It is not a simple process, but it is one that will keep your business competitive long-term.  By partnering with experts and embracing innovation, businesses can future-proof their fleets, reduce operational costs, and contribute to a more sustainable transportation industry. Now is the time to prepare for the future.

WEX speaks the language of small business operators. Whether you’re looking to modernize your insight and reporting efforts, save on fuel costs or take advantage of the latest GPS tracking technologies, WEX offers solutions to simplify the business of running a business. To learn more about WEX, a dynamic and nimble global organization, please visit our About WEX page.

To learn more about EV solutions and mixed fleets, visit:

• EV: Everything you need to know for your commercial vehicle fleet
• EV adoption: 4 global trends in transition to mixed-energy fleets
• EV FAQs
• How to best incorporate EVs into your fleet
• EV at-home charging

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Resources:
World Economic Forum
MIT Technology Review
Electronic Frontier Foundation
New York Times
McKinsey
EV Connect
Environmental Protection Agency
Forbes
Science Direct
U.S. Energy Information Association
Just Energy
Recurrent
Renault Group
Canary Media