Dealers could benefit from a massive spurt of interest in salary sacrifice for cars schemes, which make new cars available to employees who do not qualify for company cars in exchange for a monthly payment from their salary.
Four of the country’s largest company car providers will all launch salary sacrifice schemes to their customers this year. Their move into the sector could potentially bring hundreds of thousands of new buyers into the new car market for the first time.
The benefits for employees are significant as the payments for their new car are taken from their salary before tax and National Insurance.
Tusker, an established salary sacrifice provider says dealers stand to benefit.
“Tusker has gone to considerable lengths to source cars for its salary sacrifice schemes from local dealers, and has struck up relationships with supplying dealers local to many of its salary sacrifice contracts,” explained Tusker managing director David Hosking.
“Take the example of an engineering company in Aberdeen which went live with a scheme in January – Tusker has struck up a relationship with a local multi-franchise dealer group to supply all the cars.”
The arrival of the major lease companies, who between them already have well over 540,000 vehicles on their books, is a result of the growing interest in providing salary sacrifice benefits from HR departments.
Lombard, which launched its salary sacrifice offering last spring, is also reporting growing interest.
“We are experiencing a very large increase in interest - a year ago almost no-one was talking about them but probably 50% of our major customers are now,” said Lombard’s Paulo Larkman.