Leasing electric cars for your business
With the UK Government committed to banning the sale of new petrol and diesel cars from 2035 onwards, fleet managers and business owners need to give serious consideration to electric car business leasing.
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If you’re a senior decision-maker in your business and thinking of switching from a conventional vehicle fleet to an electric one, there are several factors that need careful consideration before you do so. These include:
- Total outlay
- Charging costs
- Maintenance costs
- Tax benefits
- Insurance
- Practicality
- Sustainability goals of your business
Buying or leasing business electric cars and vans
Purchasing electric cars or vans is a serious investment with models often costing more than their petrol or diesel equivalents. Therefore, leasing electric cars or vans – or if you’re a business owner, leasing several of them with an electric car Business Contract Hire scheme (BCH) – makes sense in terms of cost savings and practicality. When you lease, there is no asset depreciation and the monthly fee is fixed for an agreed term. When the car reaches the end of its contract, you will hand it back and you can lease another one. Leasing can also mean significant tax savings for your business.
Range and charging infrastructure
You may, however, have concerns about the range of electric cars and where you’ll be able to charge them. Though some models with larger batteries have a range of over 300 miles, they’re often at the premium end of the market. However, many have a range of between 200 and 250 miles. According to the British Vehicle Rental and Leasing Association (BVRLA), most company cars in the UK drive between 12,000 and 16,000 per year – working out at about 54 miles at 260 working days. Obviously, this is just an average. Some journeys, by sales reps for instance, will be a lot longer.
This leads to the next question – where can electric cars be charged? For a business, the most obvious place is at the business premises or the employees’ home if they have off-street parking. ElectriX can help with the installation of Indra smart chargers for employees’ homes. But for those long-distance trips, charging may have to be done on the journey or on arrival. There are now more than 45,000 public charging points (as at August 2023) in the UK, which can be located on charge point apps, or our charge point map.
Other things to consider
Maintenance costs can be covered by the lease, though with fewer moving parts than petrol or diesel vehicles, electric cars tend to be cheaper in this regard. Insurance costs can be part of a package, too. Tax savings, meanwhile, can be quite significant for both businesses and their employees with Benefit-in-Kind (BIK) tax currently at 2% per year until 2025 when it will increase by 1% per year until 2028.
Last but not least, is the fact that using electric vehicles reduces the carbon footprint of your company and perhaps makes it a more attractive place to work for prospective employees, who will see the EV fleet as a sign of your company’s commitment to the future and the welfare of the planet.
Find out more about the range of electric cars available for Business Contract Hire with Electrix and CBVC.
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