Novated leases shift to favour EVs

A SIGNIFICANT change in the types of vehicles leased as part of Australian’s salaries is underway, influenced largely by the Electric Car Discount Bill.

Resulting in a Top 10 list that looks “dramatically different” to previous years, Fleet News Group says lessors are voting with their wallets, moving away from once-popular models like the Ford Ranger and into battery electric models like the Tesla Model Y.

Citing the introduction of the Electric Car Discount Bill in 2022 as the key to such rapid change, Fleet News Group says the shift in buyer habits was almost instantaneous.

“2023 was a year of great change and big swings in the pendulum between energy efficient EVs and the traditional big selling dual-cab utes and SUVs,” said Inside Edge Novated Leasing sales and marketing director Andrew Kerr.

“At Inside Edge, we were quick to implement the government’s electric discount legislation which provided our clients with the opportunity to enjoy huge tax savings on EVs under the (FBT) threshold.

“While the traditional dual-cab utes and SUVs still held their own, what has been very interesting is the enquiry level and the variation to the types of vehicles our clients wanted to discuss and learn more about.

“So, while we saw a huge take up of EVs those who may have settled on a traditional petrol-based car were very open to learning more about EVs both battery and PHEV and remarked how their next purchase will be very different to their current car.

“We see the trend to EVs continuing over the current years given the amount of energy efficient vehicles coming on to the car market.”

As the popularity of electric vehicles increases so too has the number of novated lessors opting to trial the new technology.

Many newly introduced EVs have made the Top 10 novated vehicle list for the first time, with survey results for 2023 showing an electric vehicle taking first, second and third place.

“The Tesla Model Y is hands down the most popular Origin subscription vehicle for 2023, followed by the Tesla Model 3,” explained Origin general manager of e-mobility Chau Le.

“Excitingly, with new or updated models scheduled for release this year, Origin EV subscribers will have more EV options – we have an EV employee benefits or salary sacrifice package to suit every taste, budget or lifestyle.”

Interestingly, there are some novated leasing providers that say dual-cab utes are “almost disappearing” from their portfolio as electric vehicle importers make their presence in the market known.

“We have found that there has been an increase of approximately 40 per cent in enquiries for novated EVs and this is translating into Tesla Model Y vehicle sales as the leading EV,” said Summit Fleet Leasing and Management national novated manager Philip Owen.

“Dual-cab utes have really fallen away in our novated lease enquiries now as EVs have taken the lead.

“We are seeing a big increase in BYD and GWM enquiries but, as yet, this has not translated into major sales numbers.”

2023 Top 10 novated lease vehicles: