Dutch VZR: ‘Lease car in its current form to disappear’
Dutch business drivers fear the lease car they got from their employer could be the last one, due to the paradigm shift the corona pandemic caused. In its current form, the lease car is to disappear, their organization, Vereniging Zakelijke Rijders (VZR), representing 1,3 million of them, states in newspaper AD.
Many of them are worried that teleworking and video conferencing instead of ‘live’ business meetings will mitigate the need for traveling. Business kilometers will still have to be made to an extent, but employers will likely ask to do this with the private car. Figures like 30 000 fewer leasing cars registered in the first eight months than in the same period last year feed the concern.
“That the lease car in its current form is to disappear is a near-certainty for us,” says VZR President Jan van Delft in AD. “We hear from our members working at smaller companies that lease cars are dumped in favor of pool cars. But also in bigger companies, this has become an issue at the employees’ council.”
Mobility budget of €800?
Van Delft wants the government to do something about the current ‘bijtelling’, the value added to the taxable income for people having a company car. According to VZR, this represents, on average, 8% of the net wage of an employee.
“We want a mobility budget for business traffic. For example, 800 euros per month, the employer gives his employee to spend freely. This has to be regulated fiscally. Then the Dutchman gets smart. One time, he will rent a car, the other time he’ll take public transport or decide to work from home.”
Old-fashioned lease contract
The era of the old-fashioned lease contract is over, Van Delft believes. “A lot of people don’t even work for four years for the same employer anymore. Being an employer, you get stuck with the lease car as most contracts are for four years or more.”
The most popular lease cars (above €40 000) in the Netherlands are the Tesla Model 3, the BMW 3 Series, and the Volvo V60. The rest of the top 10 are also German (premium) cars, except for the Volvo XC60.
In the category from 20 to 40 000 euros, the Kia Niro (hybrid, PHEV and BEV), the Ford Focus, and VW Golf are most popular, with the Hyundai Kona coming in fourth in both electric variants.
Bovag, the Dutch federation of car dealers and garages, expects the leasing companies to come with alternatives in the near future. Like mobility products that are a mix of public transport, bicycle, and cars. In Belgium, the government tries to push companies to such a mobility budget, but the appetite remains low so far.
No success in Belgium
Between April and December 2019, only 242 Belgian employees subscribed to the mobility budget, according to figures quoted in September by then Finance Minister Alexander De Croo (Open Vld). The system was introduced in April 2019 to encourage people not always to go to work by car and hence reduce traffic jams.
Belgian workers entitled to a company car can exchange their vehicle for a smaller and greener one, with a budget for the train, a shared bicycle, or other sustainable means of transport. But so far, Belgians aren’t dying to make the switch and prefer the classic leased car as a convenience.
The new Belgian government, lead now by Alexander De Croo as Prime Minister, states in its coalition agreement it is going to broaden the mobility budget. It wants to expand it to every worker, also when he or she has no access to a company car. Of course, this goal is acclaimed by all providers of new mobility services, but experts warn for the huge financial impact this could have.