Ethias gets EU’s green light for stepping into EV leasing market (update)

Belgium’s fourth biggest insurer, Ethias, announced in June it is entering the volatile market of leasing electric cars with a helping hand from Spanish specialist Banco Santander.

The European Competition Authority now gives the green light for the merger with the Dutch daughter of the Spanish bank, Santander Consumer Leasing BV, as it sees no objections. Its structural impact will be limited in an already crowded leasing market.

With a new business model based on EVs exclusively with more extended contracts of up to six years, it wants to be a price breaker and offer cheaper formulas.

From September, the new Ethias Lease Corporation plans to start its commercial activities, aiming at a fleet of 8 000 leased EVs by 2027. Erwin Ollivier, the former CEO of Mercedes’ Athlon Lease, is the man who gets three years to accomplish that.

Crowded market place

It won’t be a walk in the park, though, as the Belgian leasing market is already quite crowded with 15 players, among which some really big ones, who joined forces recently to become dominant. Like the LeasePlan take-over by ALD Automotive, becoming a force to reckon with, managing a global fleet of 3,3 million vehicles across 59 countries.

Ethias is anticipating the changes from July 1st in the Belgian tax deduction incentives for electric vehicles, where plug-in hybrid company cars will no longer be 100% deductible. Full electric cars, though, remain fully deductible until 2028 at least, and the leasing market for BEVs is expected to boom even more in the coming years.

New business model

To make a difference with the competition, Ethias Lease counts on a new business model starting from a blank paper, based on EVs only, as Erwin Ollivier explains in De Tijd. Traditional leasing is based on ICE cars with a life expectancy of four years or 100.000 km on average.

EVs are expected to require less maintenance and easily go beyond that 100 000 km boundary, even though questions are often raised about the life expectancy of the batteries used.

According to Ethias, by focusing on EVs only, six-year contracts offer the possibility to lower total cost and offer attractive lower prices of 50 to 100 euros per month compared to the current competition.


But even 100 euros less per month might be an underestimation. The uncertainty on battery degradation is used by traditional lease companies as an excuse to ‘overcharge’ electric cars systematically.

The ten biggest leasing companies in Europe, managing today a fleet of 12 million vehicles, overcharge on average by 57% or €233 per month, and €8 370 over 36 months, compared to a similar vehicle on gasoline. The latter was denounced by the environmental lobbying group Transport & Environment (T&E) in March in a new report.

Leasing companies claim lower resale values based on uncertainty about battery degradation and rapid technical evolutions in the sector. But in practice, these batteries prove to last longer than expected. On top of that, an analysis of 2,7 million used car prices in Europeʼs five most significant markets by Transport & Environment proves them wrong.

Even reports by lease companies like LeasePlan show EVs are primarily on par in TCO with their ICE siblings or cheaper. So how do they justify the overcharging?

EV cheaper in TCO

As the Total Cost of Ownership (TCO) best reflects the actual cost for the leasing companies rather than the higher EV list prices the general public takes for granted, one can assume the latter is used to mask substantially higher profit margins. And that hinders EV uptake, especially for private owners.

T&E isn’t saying this so boldly but questions the lease companies’ claim of environmental leadership and calls on them for more transparency in price setting and EV uptake. But that might fall on deaf ears as nearly all top leasing companies are owned by banks (3) or car manufacturers (6) themselves.

The lease market for company cars systematically drives new car uptake in Europe, particularly in Belgium. Here 60% of employers say a company car is a main factor in attracting new employees, and company car registrations make up 61,9% of total new cars sold.

Price breaker needed?

Ethias Lease might be the price breaker the Belgian market needs to get things moving. By 2027 it wants to manage a fleet of 8 000 EVs and offer 6 000 home charging solutions. But eight thousand vehicles are peanuts compared to the fleets of tens of thousands of other big players. Ethias will target, in the first place, the insurer’s traditional clients, government instances, and SMEs.

It will get the help – in expertise and software – of Spanish Banco Santander, the ‘house leasing company’ for the Stellantis group, among others. This way, Santander gets an entry into the Belgian lease market too.




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