Vast majority of businesses want to offer electric car salary sacrifice in 2024
New research by The Electric Car Scheme reveals 83% of companies plan to offer an electric car salary sacrifice scheme in 2024.
Concerns remain about cost and risk to business of implementing the scheme, with lots of misconceptions.
Employees at the majority of businesses in the UK should be able to access a salary sacrifice electric car from next year, new research has revealed.
The Electric Car Scheme recently released a survey of 250 managing directors, finance directors, and HR directors.
It revealed that:
• 83% of respondents plan to offer an electric car salary sacrifice scheme in 2024 for their employees.
• 47% plan to implement one in the first half of 2024.
• 16% already have one in place at their business.
This indicates that next year could see a significant jump in the number of employees taking advantage of this generous benefit. This is good news for employees wishing to make the switch to reduce their carbon emissions and make the most of the generous tax incentives available.
While awareness of the scheme, which allows employees to save 30-60% on an electric car lease, is high, there are a number of potential misconceptions which may be holding back uptake.
89% of directors believe it would cost them money to run an electric car scheme, as 90% believe there is significant risk to the company by having a scheme (i.e. if an employee leaves or is made redundant).
However, this is a misconception, as there is no direct cost to businesses to run an electric car scheme, and through The Electric Car Scheme, there is no risk to the company should an enrolled employee leave.
This perceived cost is key in the decisions of directors. When asked to rank the importance of four considerations when implementing an employee benefit, cost came out on top. This was followed by the benefit to the employee, the risk to the business and finally the effort it takes to set up.
Other key data points from the survey:
• 55% already have a cycle to work scheme.
• 89% believe it would cost them money to run an electric car scheme.
• 90% believe there is significant risk to the company (i.e. if an employee leaves or is made redundant).
• 74% believe it would take a considerable amount of work internally to implement an electric car scheme.
• Ranking of most important considerations when considering implementing a new employee benefit.
Cost to set up and run the scheme.
Benefits provided to employees.
Risk to the business when running the scheme.
Amount of work required to set up and run the scheme.
The Electric Car Scheme CEO and Co-Founder Thom Groot commented:
“There is tremendous demand for electric cars through salary sacrifice, which is rising all the time. It is no surprise to see that 2024 is set to be a landmark year for the scheme. This is a sought after benefit, and one that can make a big difference in both talent attraction and retention, and HR directors clearly realise this with plans to stay ahead of the curve in the works.”
“What is clear, however, is that decision makers still see it as a potentially risky, complex, and costly benefit to implement.
This is exactly why we set up The Electric Car Scheme, I was trying to set up a scheme for myself and found it far too complex. The Electric Car Scheme is free for employers to run, removes that complexity by taking the paperwork off stressed HR managers’ hands, and through our market-leading Complete Risk Protection means that there is no risk to the business.”
