Car markers rush to capitalise on popular EV perk amid new model launches
This World EV Day we look at new models targeting government discounts intended to make people switch to electric cars.
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Car makers are rushing new models to market that take advantage of a lucrative electric vehicle lease perk, the Fringe Benefits Tax (FBT) exemption.
This tax concession, originally designed to encourage more Australians to switch to electric cars, has turned into a major driver of sales, far beyond government expectations.
Recent data from the National Automotive Leading and Salary Packaging Association (NALSPA) reveals that the exemption has significantly boosted demand, especially in outer suburb areas like Werribee, Victoria, Beaumont Hills in New South Wales, and Duffy in the ACT.
The lease body also reveals that a staggering number of Australians are taking advantage of the exemption with a surge in novated leases for battery electric vehicles (BEVs) and plug-in hybrid electric vehicles (PHEVs).
Given this rising interest, many automakers are strategically launching new models that fall under the Luxury Car Tax (LCT) and FBT cut-offs.
For instance, Volkswagen is reintroducing the iconic Kombi in a fully electric version—the ID. Buzz.
Priced from $79,990 for the cargo variant and $87,990 for the people mover, the ID. Buzz stays below the LCT threshold, making it an attractive option.
Similarly, Audi is offering the Q4 e-tron as a premium yet affordable entry into the EV market, with prices starting from $84,900.
The Q4 e-tron, expected in December, will also come with an enticing launch offer: a year of complementary Chargefox public charging.
The updated MY25 Polestar 2 range, starting at $62,400 and the Polestar 4 SUV coupe, starting at $78,500 for the single motor, will also be available under the LCT threshold.
Head of Polestar Australia, Scott Maynard, said the pricing realignment was an important step to continue to drive electric (EV) uptake in Australia.
“Polestar Australia now has six variants under the Luxury Car Tax threshold, more than we have ever had before, which is great news for Australian consumers,” he said.
Then you have new brands like Smart, and Chinese automakers Zeekr and XPeng who are also set to capitalise on the FBT and LCT cut-offs.
These brands are offering stylish designs, advanced technology and competitive pricing.
These new car brands are designed to undercut established players, all while staying under the tax threshold.
With major EV barriers like pricing, tax concessions are helping potential EV buyers.
A range of electric vehicles will also be on offer as new brands plan to broaden their range.
Head of Smart Australia Michael Low said they have big plans for the brand.
“Smart will keep on expanding its product family to offer a variety of cars that optimally suit different customer groups and lifestyles,” he said.
However, as more new brands enter the market and EV adoption rate climbs, the long-term strategy of these tax perks may come under scrutiny.
Already, the increased uptake has seen the government’s forecast costs ballooning from $260 million to $1.15 billion over four years.
Originally published as Car markers rush to capitalise on popular EV perk amid new model launches
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