Low benefit in kind tax rates remain a central driver of electric vehicle adoption in the company car market, according to new data from British Vehicle Rental and Leasing Association. Its latest Leasing Outlook Report shows salary sacrifice drivers are four times more likely to choose a fully electric car than personal contract hire customers.
Three quarters of lease cars on the BVRLA fleet are now capable of zero emission driving, with battery electric models leading uptake. Penetration remains uneven, however, ranging from 83% of salary sacrifice fleets to 47% of business contract hire vehicles and just 18% of PCH. Without the BIK incentive, almost two thirds of PCH drivers still opt for petrol or diesel.
Overall leased vehicle volumes rose 8% year on year to 1.98 million, although the BVRLA warns growth is coming at the expense of margins. Toby Poston said progress on decarbonisation is being tempered by compliance costs and EV depreciation, calling for closer partnership with Government.
Growth continues to be led by business contract hire and salary sacrifice, while vans remain dominated by diesel powertrains.
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