Is the Electric Car Dream wrecked?

The Electric Vehicle Plan

Over the past years, we have moved our entire company fleet to electric vehicles.  This ticks the box in terms of sustainability and the reduction in Benefit in Kind means that our drivers gain a “free” pay rise (about £,500 per year on average) without costing the company any more!

We have also introduced a Electric Vehicle Salary Sacrifice Scheme which means that our non-company car team members can also gain up to 40% reduction on the cost of leasing an Electric Car.  

Again, this is a benefit to the employee which costs the company nothing.

As Electricity prices begin to soar even higher as an employer we need to see how we can help our employees more.

We have been applying pay reviews to keep our team in line with or ahead of inflation, but this adds to our costs and means we have to review our prices.  

We are fully committed to improving sustainability as well.  

Does the cost of Electricity wreck the case for Electric Cars

Much commentary at the moment is discussion the comparison of running an electric car with the cost of fuel.

The math goes as follows  

Petrol at £1.50 per litre on a car that will do 50mpg. The cost per mile in fuel is 13p  

An typical EV will do 4 miles per kWH of electricity – at a rate of 60p per kWh this works out at 15p per mile.  

It looks like the argument for Electric Vehicles doesn’t work!

However, this argument is not an apples with apples comparison. It compares largely the best case for petrol with the worst case for Electric Vehicles.  

The key here is that the cost of electricity is wildly variable.    In reality the cost of a kWh can range from 0p (if you have solar or maybe use free public charging -it still exists!) through to 5-7.5p for night time overnight rates (which anyone with a home charger can easily make use of) through to daytime and public rates which look like being the headline 50+p per unit!

For drivers that do less than 200 miles per day (most!) who have the ability to charge at home (many) the typical costs will be under 10p per kWh.

At this rate, the cost per mile for an Electric Car in “fuel” is under 2p per mile.

The math is logically still in favour of Electric Vehicles.  

We can help to reduce these costs further

We are always searching for ways of giving our employees benefits.

Ones that cost the company nothing and help to improve sustainability are gold!  We can give our employees an increase in disposable income without us having to charger our customers more whilst also adding to our aim to improve our sustainability.  

We’ve found another one which we have launched to our team this week!

So what did we do ?  

The new scheme we’ve launched works on the basis that Electricity to charge a car is not legally a “Fuel” – so paying to charge an car is not a Benefit in Kind.  

So… if we can somehow pay for the electricity our employees company owned (either fleet or salary sacrifice) vehicle and deduct this from the employees pay the net cost to the company is Zero!

BUT! The cost to the employee reduces by 40% or more, as there is now no PAYE or National Insurance to pay on the income used to charge the car!

How did we do it ?

Simple!

We teamed up with a local Sheffield based company called MINA (https://mina.co.uk).

Mina is magic!

It pays for our drivers electricity costs – both at home and on the road - directly.  

By linking to their home charger and electricity bill, they work out how much the car has cost to car and pay this directly to our employees electricity bills – so the don’t have to.  

They also supply an Electric Charging card which works with most on-the-road charger companies so our team don’t pay when charging whilst travelling.

Then they bill us for this cost with a small admin fee.  

All we do is reduce this from our employee’s payslips.  

Very low maintenance, and everyone is happy.

Every £1 of electricity used to charge their cars costs 60p or less.  

A FREE PAY RISE FOR OUR TEAM, WITHOUT US NEEDING TO CHARGE OUR CUSTOMERS MORE!

This could be a massive benefit for our customers!

It strikes me that this is a massive benefit for our customers who are selling Electric Cars to Fleet customers.  By adding MINA into the equation it ticks a number of boxes :-

1. It can add extra benefit to their company car drivers as it does for us

2. It allows them to fully cost and pay for the electricity used in the cars.

If you’re a car dealer, and you sell electric cars to fleets – then adding MINA into the mix may just help you to both differentiate your offering and add more benefits to your vehicle offering!

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