Sales of battery electric and plug-in hybrid electric vehicles are beginning to take a greater share of new novated leases, reflecting continued interest in electrified vehicles across Australia.
New figures from Australia’s National Automotive Leasing and Salary Packaging Association (NALSPA) show that electric vehicles are beginning to make up between 35% and 40% of all new novated leases.
The latest figures from the Federal Chamber of Automotive Industries show that sales of EVs accounted for 9.6 per cent of total new car sales in Australia in February, a record high, but the share of EVs in the novated leasing market is even higher.
“The continual easing of vehicle supply constraints and government discounts on new zero and low emissions vehicles are making it easier and more affordable for everyday Australians to purchase a new car,” said Rohan Martin, NALSPA CEO.
“Our members are reporting robust growth in novated lease sales, particularly as a result of the Government’s EV FBT exemption and greater EV model availability. This discount is making EVs more affordable to purchase which is driving new interest from a range of Australians across the country.
“As many Australians navigate cost-of-living challenges, they’re looking for ways to help them save on their transport related costs – and a way they are achieving this is by turning to novated leasing.”
A novated lease is a finance arrangement between the customer, their employer, and a novated leasing company which lets you pay a monthly bundled cost out of your salary package through a combination of pre-tax and post-tax salary deductions.
In addition to avoiding the need for a significant up-front lump sum, novated leasing offers overall savings on the purchase price and running costs of a new or used car.
“The family car is one of the biggest investments for Australian households and with the benefit of salary packaging they are able to reduce their income tax, potentially helping to save them thousands of dollars,” said Martin.
“Selecting an EV can save motorists even more when factoring in the EV FBT discount and their reduced running costs.
“These latest figures also underscore the important role that PHEVs are making as Australia transitions to a lower emissions future with sales up 126 per cent in January and February 2024 compared with the same period last year.”
Joshua S. Hill is a Melbourne-based journalist who has been writing about climate change, clean technology, and electric vehicles for over 15 years. He has been reporting on electric vehicles and clean technologies for Renew Economy and The Driven since 2012. His preferred mode of transport is his feet.