Electric Vehicles: Why They Should be Your Next Employee Benefit
Thinking about your next employee benefit? If you’re looking to retain talent, enhance your brand, and help the environment, electric vehicles (EVs) could be the answer.
The UK plans to ban the manufacture of all new petrol or diesel cars by 2040, making EVs the future of transport. Under new salary sacrifice rules, you can help prepare your employees for these changes while saving them money on a new car.
What are electric vehicles?
The main difference between an electric vehicle (EV) and a standard one is how it creates power. A non-EV creates power through the internal combustion of fossil fuel, such as diesel or petrol. An EV, on the other hand, creates power through electricity stored in a battery.
Not all electric vehicles are created equal, however – some use 100% electricity while others use a mixture of electricity and fossil fuel. The government’s salary sacrifice scheme favours those where the battery is the only or primary source of power:
- Zero emission EV – this vehicle is 100% electric. No internal combustion engine, so emits 0g/km of CO2. Examples include the Nissan Leaf, Tesla Model 3, and Renault Zoe.
- Extended range EV (E-REV) – the battery drives the wheels, but an internal combustion engine recharges it as necessary. Emits around 20g/km CO2, so is included in the salary sacrifice scheme. An example is the BMW i3 with range extender.
- Plug-in hybrid EV (PHEV) – this EV has an internal combustion engine, but only uses it to extend range and improve efficiency. Emits 40-75g/km CO2. Depending on the make/model, it’s also included in the government’s salary sacrifice scheme. Examples include the Toyota Prius and Audi A3.
Depending on which EV type you buy, and how you buy energy at home, electric vehicles are an environmentally-friendly alternative to standard cars. They don’t emit pollution and, if you charge them using renewable electricity, they’re carbon neutral (excluding anything emitted in the manufacturing process).
Given the technology involved, you might think EVs are a new invention. In reality, they’ve been around for almost two hundred years. They lost the battle for dominance after the invention of the self-starting motor, but battery technology and drive-train efficiency has greatly improved since. Today’s EVs aren’t just for golfing or doing the morning milk round, but for the serious, everyday commuter.
Range anxiety – the fear of running out of charge before reaching your destination – is all but unfounded in the latest models. Not only can you drive from London to Manchester on a single charge, but there are almost 20,000 EV charging stations around the UK where you can top up and be on the road again within the hour (and the government plans to invest £400m on more).
Why your employees want electric vehicles
The government’s salary sacrifice scheme changed in April 2017. Your employees no longer enjoy tax breaks on new petrol or diesel cars. However, they do on Ultra Low Emission Vehicles (ULEVs), meaning you could help them make attractive savings on a new electric car.
Electric vehicles are also extremely cheap to run. There are fewer moving parts, so fewer things to break, which will mean less maintenance. You also pay a lot less for electricity than you do for fuel. The BMW i3, for example, will cost around £0.03 per mile, but the petrol version will cost around £0.13. That’s a saving of around 75% on fuel costs. Electric vehicles costing less than £30,000 are exempt from road tax, too.
If your employees choose to participate in demand-side response schemes like Vehicle-to-Grid, they will also be able earn money by leasing their charged batteries to local power networks. They can charge their EVs at off-peak times to take advantage of cheaper prices, and then resell spare electricity during peak demand. The infrastructure isn’t quite ready for this yet, but it’s coming soon.
How an EV scheme benefits your business
With so much emphasis on environmental issues today, helping others “go green” is a bonus to corporate social responsibility. Many of your present and future customers or employees will be environmentally conscious. Ignoring their needs is a missed opportunity – one that could cost you profits or talent.
Recruiting the best minds in your industry demands a leading benefits package. This is the perfect time to take advantage of generous tax breaks and incentive grants to recruit and retain the best talent and reduce your environmental impact at the same time. As a cost-effective way to boost your green credentials, an EV benefit scheme is tough to beat.
We can help
As experts in employee benefit cars, we’d love to help you arrange the best salary sacrifice scheme for your employees. We can help you choose the right vehicle, arrange insurance, assist with salary sacrifice policy, and much more, leaving you time to get on with running your business.
So don’t delay – get in touch now and find out how easy it is to make EVs your next employee benefit.