The UAE is renowned for its car-centric culture. But it is steadily carving a niche as a green mobility leader. According to estimates, the nation already boasts around 100,000 electric and hybrid vehicles on its roads, with a government target to ensure 10% of all vehicles are electric by 2030. But while progress is evident, the pace of adoption varies significantly between fleet operators and individual car owners.
Carlos Montenegro from Al-Futtaim Automotive explains that fleet owners, particularly companies and government entities, are taking the lead in electrification. Meanwhile, individual car buyers are adapting at a slower pace.
Fleet Operators at the Forefront of Change
The numbers tell the story. As of mid-2024, 11% of all vehicles sold in the UAE are classified as New Energy Vehicles (NEVs), which include electric and hybrid models.
At Al-Futtaim Automotive, NEVs already represent a more impressive 23% of total sales. Yet, 70% of these sales cater to fleet customers, underscoring their pivotal role in driving the EV transition.
Why are fleets leading the charge? Government mandates play a significant role. Public entities are increasingly required to adopt greener mobility solutions as part of the UAE Net Zero 2050 Strategy and Dubai’s Green Mobility Strategy 2030. At the same time, private corporations with ambitious sustainability targets are turning to fleet electrification to meet these goals.
Fleet managers understand the long-term cost benefits, according to Montenegro. Electric vehicles, with their lower maintenance and fuel costs, present a compelling economic case over time. For high-mileage fleets, the savings are even more pronounced, making EVs a practical choice for businesses.
Fleet operators are also better equipped to navigate challenges like planning for charging infrastructure. For them, the transition is a strategic decision, looking at both financial advantages and alignment with sustainability goals.
Carlos Montenegro explains: “These large organizations are also better positioned to calculate the total cost of ownership (TCO) of electric vehicles, which is more favourable over time compared to internal combustion engine (ICE) vehicles. Fleet managers are looking at long-term savings, and the economic advantage of EVs becomes more apparent the more they are used.”
He continued: “Fleet operators also benefit from having an integrated end-to-end ecosystem at their disposal through distributors like Al-Futtaim Automotive, where we offer not only the vehicles but also the accompanying charging solution, aftersales packages, and de-fleeting (buyback) options.”
Carlos Montenegro from Al-Futtaim.
Barriers Slowing Individual Adoption
While fleet electrification is accelerating, individual adoption remains more gradual.
Challenges such as charging accessibility, difficulties in installing home chargers, and the upfront cost of electric vehicles continue to be hurdles – whether these are actually real or largely perceived.
However, progress is being made. According to a recent report by Roland Berger, the UAE leads the region in availability of public EV charging infrastructure, and DEWA plans to expand the network to 1,000 public chargers by 2025.
Concerns around range anxiety and charging infrastructure are easing, as the same report indicates that 50% of respondents believe public charging has become easier over the past six months. As infrastructure improves and prices become more competitive, the transition for individual buyers is expected to gain momentum.
A Balanced Future for Green Mobility
Looking ahead, the UAE’s electrification journey must strike a balance. Fleet operators have laid a strong foundation, but achieving the nation’s sustainability targets will require greater individual participation. Efforts to address barriers—such as expanding charging networks and offering more affordable EV models—will be critical.
“Electrification isn’t just about selling cars,” Carlos Montenegro concludes. “It’s about creating an ecosystem that makes greener mobility a practical, smarter and delightful choice for everyone, be they individual car owners or fleet managers.”
As the UAE accelerates its drive towards net-zero, the combined efforts of fleet managers, individuals, and policymakers will shape a future where green vehicles are the norm, not the exception.
