Leading Motoring Journalist Toby Hagon shares his thoughts on Electric Cars for INSIDE EDGE
Toby has more than 30 years experience as a Motoring Journalist and recently ran an Information Session for INSIDE EDGE clients on Electric Cars. The session was so popular we wanted to share his thoughts in more detail.
Electric cars are fast going from a niche offering to the main game in the car industry. With Tesla leading the charge (sorry…) every car brand in the world is now making or soon-to-make an Electric Vehicle (EV) of some persuasion. All of which is creating opportunities and a smorgasbord of choices for those ready to trade up to a new car.
Buyers are embracing EVs
Key to the EV surge is an influx of drivers prepared to trade petrol for electrons. Whether it’s to lower running costs, help the environment or unleash some very real performance benefits, many buyers are realising that EVs make a thoroughly viable alternative. It’s a point not lost on Inside Edge, which is embracing the EV movement.
“This shift towards EVs is consumer driven, it is technology driven and it is government driven,” says Mark Telfer, Inside Edge Finance and Operations Director. Mark believes the new breed of EVs are about plenty more than transport, describing Tesla as “the most integrated piece of technology in the automotive world in terms of how that car interacts with you”.
From remote monitoring and smartphone activation of functions such as door locks and ventilation (no more coming back to a steamy car!) to integrated games and calendars, Telfer believes EVs have a lot more to offer than just never having to refuel again.
Step away from the bowser and unlock the tax breaks
Ditching petrol stations is, however, a big part of the appeal for many. “What you’ve got with EVs is a whole lot more flexibility,” Mark says.
Leaving home every morning with a full battery means no disruptions during the day and the ability to avoid the upsell to a Mars Bar at the local service station. And with electricity costs around half those of petrol, it can in time offset the price premium attached to some EVs, making a lease an attractive proposition for those looking at EV’s.
Telfer agrees some aren’t ready for the full EV plunge, and instead pointing to the growing hybrid options that provide a stepping stone to electrification. Telfer thinks they will continue to play an important role as the new car market evolves.
“The conversations that we are often having with people are to at a minimum consider a hybrid as one of the options we are looking at for them”
EV experience counts
All of which creates opportunities in the leasing space. “The running costs [of a novated lease] are pre-tax … with an EV you’ve got lower running costs, so we always take that into account in planning the client’s package to get the maximum benefit,” says Telfer.
He points to buying and installing a home charger as one area the tax benefits come back into play. There are other components that factor in, too.
The additional weight and performance of an EV can lead to higher tyre wear, something Telfer says “we have built into the leasing package of the average EV”. Telfer believes the extensive experience Inside Edge has on leasing EVs gives it an advantage over competitors.
Inside Edge’s Sales and Marketing Director, Andrew Kerr, says taking a novated lease on an EV gives easy access to new technology.
“If employees have a supportive and informed employer, and when interest rates are low, a well structured Novated Lease provides the tax effective way to buy,” he says.
The choice is yours
Telfer believes some of the bigger leasing companies discourage people from taking the EV plunge because it potentially impacts their revenue.
“They clip the ticket when you spend money on fuel and servicing,” he explains, pointing out about the discrete revenue deals you may not realise are taking place. “Our business model is a bit different to our competitors.”
Thats one reason Inside Edge is more than happy to direct people to an EV. And if you end up with Mark Telfer on the phone his passion for the influx of EV tech and the growing options – he’s got a Tesla Model 3 in the garage – will come through.
“Our percentage of EVs would be 10 times higher than our competitors,” he says, adding that EVs are changing peoples’ perception of cars. “And EVs have given people the ability to feel good about what they drive and can potentially influence perceptions”.
Telfer even allows demonstrationsof his Tesla so people can experience the tech first-hand. It’s all about the personalised approach and ensuring the lease suits the person signingthe forms rather than the company packaging it up.
“Inside Edge is a different operation, and we tend to be more of a consultative basis,” says Kerr. “That’s how we approach it.”
Pocket the profit
Kerr also says there’s a potential unexpected win at the end of a lease period. With residual values of EVs strengthening – the Tesla Model 3 currently has among the strongest resale values of any new car – there could be a surprise in store come changeover time.
“If you tax effectively set up your novated lease …and if you then make a profit over and above your residual value, that profit is tax free as well,” he says.
So smart car ownership can lead to a bonus at the end of the lease… by which time there will be plenty more choices in the growing EV market.