A new survey commissioned by Novated Lease Australia has revealed that while the cost of electric vehicles (EVs) is a major purchase barrier for 84% of Australians, 46% would consider switching to an EV if their employer offered a novated lease agreement.
Novated leases are a ‘salary sacrifice’ arrangement, where the cost of the car is paid for through pre-tax pay. This can cover repayments on the car itself, as well as fuel, servicing, insurance and other running costs. At the end of the lease term, employees can choose to pay the balance and own the car outright or upgrade the car.
The survey found that younger Australians are more likely to switch to an EV under a novated lease agreement to reduce costs: more than half (59 per cent) of under-30s indicated they would, compared with 32 per cent of over-51s.
In response to this, State and Federal Governments across Australia have made recent efforts to reduce EV costs at the lower price range. This includes introducing the Electric Car Discount Bill in November last year, which removes the fringe benefits tax on battery, hydrogen fuel cell or plug-in hybrid electic vehicles valued at under $84,916. The NSW Government is also offering a $3,000 rebate for new BEVs and hydrogen fuel cell vehicles worth under $68,750.
Shaun McGowan, Founder and Managing Director at Novated Lease Australia, said: “Our research highlights that novated leases are on the rise this year. Electric vehicle prices still have a long way to go to drop to a level that competes with petrol cars, yet an increasing proportion of the public and business sector are becoming more carbon conscious.” He added that organisations that are sustainability-minded should consider adding novated lease agreements for electric vehicles into their decarbonisation strategies.
FAQ
Q1: Are electric car batteries recyclable?
A1: Yes, electric car batteries are recyclable.
Q2: Are electric car chargers free?
A2: It depends on the charger and the location. Some electric car chargers are free, while others may require a fee.
Q3: Can electric car batteries be rebuilt?
A3: Yes, electric car batteries can be rebuilt with the right tools and knowledge.
