Is it possible for start-ups to lease electric company cars?
As a start-up, you want to be able to get on the road quickly, but a major investment in a commercial vehicle isn’t always feasible. Leasing an electric commercial vehicle offers an attractive alternative: you can drive a modern electric van without having to pay the full purchase price up front. But is that really a realistic option when you’ve only just started your business?
In this article, we answer the most frequently asked questions about electric commercial vehicle leasing for start-ups. From how it works to how much it costs and how to go about applying. This way, you’ll know exactly where you stand and what steps you can take.
What is an electric company car lease and how does it work?
Electric commercial vehicle leasing is a form of finance whereby you pay a fixed monthly amount to use an electric commercial vehicle, without actually buying the vehicle itself. You drive an electric van or minibus, whilst the leasing company retains ownership of the vehicle.
There are two main types of lease that you will come across as an entrepreneur:
- Operating lease: You pay a fixed monthly amount that includes maintenance, insurance and road tax. At the end of the contract term, you return the car. This is the most popular option for business drivers.
- Finance lease: You finance the purchase of the company car through monthly instalments. At the end of the term, you become the owner of the vehicle.
The same principles apply to electric car leasing, but additional factors come into play. These include the charging network in your area, the vehicle’s range and any subsidies or tax benefits. The monthly lease payment depends on the value of the vehicle, the lease term, the expected annual mileage and the services included in the package.
An electric company car usually has a higher list price than a comparable petrol or diesel vehicle. This means that the monthly lease costs may also be slightly higher. On the other hand, there are lower fuel costs, less maintenance and, in some cases, tax benefits through the additional tax liability or the environmental investment allowance (MIA).
Can start-ups lease an electric company car?
Yes, start-ups can lease an electric company car, but the conditions are stricter than for established businesses. Leasing companies assess your application on the basis of creditworthiness and financial stability. As a start-up, you do not yet have a proven turnover history, which makes the process more difficult, but certainly not impossible.
What do leasing companies look for in start-ups?
When assessing a lease application from a first-time lessee, the leasing company looks at a number of specific points:
- How long your business has been in existence (registration with the Chamber of Commerce)
- Your personal credit history via the BKR
- A business plan or sales forecast
- Your financial position or savings
- The legal form of your business (sole trader, limited company, general partnership)
What can you do to improve your chances?
As a first-time lessee, you can strengthen your position by offering a security deposit, making a larger down payment or opting for a shorter lease term. Some leasing companies also require a personal guarantee from the director and majority shareholder of a private limited company. The better you can demonstrate your financial situation, the greater your chances of approval.
In addition, there are leasing companies that focus specifically on start-ups and the self-employed. They apply more flexible criteria and understand that a new business does not yet have years of financial statements. It is worth looking specifically for providers who have experience with start-up entrepreneurs.
What are the benefits of electric car leasing for first-time drivers?
Leasing an electric vehicle as a start-up offers several tangible advantages over buying or leasing a petrol or diesel vehicle. You keep your start-up capital free, benefit from lower running costs and immediately position your business as sustainable and forward-thinking.
Financial benefit: lower fixed costs
One of the biggest advantages of an operating lease is the predictability of costs. You pay a fixed amount each month and won’t be faced with any surprises in the form of high maintenance bills or repairs. This is particularly useful for start-ups, as you’ll want to keep a close eye on your cash flow in the early stages.
Electric vehicles also have fewer moving parts than vehicles with an internal combustion engine. This means less wear and tear, less maintenance and lower costs per kilometre. If you drive a lot, this difference can add up to a considerable amount over the course of a year.
Tax relief: MIA and KIA
As a business owner, when purchasing or leasing an electric commercial vehicle, you may be able to make use of the Environmental Investment Allowance (MIA) or the Small-Scale Investment Allowance (KIA). These schemes make it more financially attractive to opt for an electric vehicle. Always consult a tax adviser to determine which schemes apply to your situation.
Reputation and sustainability
As a start-up, you’re building your brand. An electric commercial vehicle demonstrates that you’re committed to sustainability. This is becoming increasingly important for customers in sectors such as healthcare, logistics and construction. Some clients even set requirements regarding their suppliers’ environmental performance.
Which electric commercial vehicles are suitable for start-ups?
The best electric commercial vehicle for start-ups is one that suits their day-to-day needs, has a sufficient range and fits within their available lease budget. For most start-up entrepreneurs, compact electric vans are the most practical choice.
Small electric vans
For many people starting out, buying or leasing a small van is the first step. Models in the compact segment offer sufficient load space for tradespeople, delivery drivers or service engineers, with a range suitable for regional work. These include vehicles with a load space of 4 to 6 cubic metres and a range of 200 to 300 kilometres on a full battery.
- Suitable for: couriers, fitters, cleaning companies, small contractors
- Advantage: lower lease price, easier parking in towns and cities
- Point to note: limited load capacity for heavy goods
Electric company minibus with a double cab
Do you have staff you’d like to take with you to the job? If so, a double-cab van a useful option. These vehicles combine extra seating with a load area or loading platform at the rear. They are popular in the construction, landscaping and installation sectors. The range of electric vehicles in this segment is growing rapidly, meaning there is an ever-increasing choice within a realistic lease budget.
Electric refrigerated lorry or specialised bodywork
For start-ups in the food sector or healthcare logistics, an electric refrigerated van may be an attractive option. This is a more specialised vehicle with a higher lease price, but it is perfectly suited to specific business activities. Always check whether the vehicle’s range is sufficient if the refrigeration system also draws power from the battery.
How much does it cost to lease an electric company car for a new driver?
The monthly lease costs for an electric company car for start-ups are usually between 400 and 900 euros per month, depending on the type of vehicle, the lease term, the mileage and the services selected. This is a wide range, as the market offers many different vehicles and lease packages.
Factors that determine the price
The lease payment is not a fixed amount. The following factors have a direct impact on your monthly payment:
- Vehicle type: A compact electric van is cheaper to lease than a heavy-duty electric commercial van or refrigerated van.
- Duration: Longer contracts (48 or 60 months) generally result in lower monthly payments than shorter contracts.
- Kilometres per year: The more you drive, the higher the lease price. Estimate your annual mileage realistically to avoid having to pay extra at the end of the contract.
- All-inclusive or basic: An all-inclusive operational lease agreement, covering maintenance, tyres and insurance, costs more than a basic finance lease agreement, but offers greater certainty.
- Deposit or security deposit: As a first-time buyer, making a larger deposit can reduce your monthly costs and strengthen your application.
Always compare several quotes
Leasing prices vary considerably from one provider to another. It’s worth requesting at least three quotes and comparing them side by side. Don’t just look at the monthly payment; also consider what is and isn’t included in the package. A low monthly payment with lots of extra costs is often more expensive than a slightly higher all-inclusive price.
How do you apply for an electric car lease as a first-time buyer?
As a first-time buyer, you apply for an electric car lease by first assessing your financial situation, then requesting quotes from leasing companies or dealers, and finally submitting the necessary documents for the credit assessment. The process takes, on average, a few working days to two weeks.
Step by step: applying for a lease as a first-time buyer
- Determine your needs: Which vehicle is best suited to your work? How much load space do you need? How many kilometres do you drive each year?
- Set your budget: What is the maximum you can spend on transport each month? Bear in mind insurance, charging and any personal contributions.
- Gather documents: Don’t forget your Chamber of Commerce extract, bank statements, a business plan or turnover forecast, and a copy of your ID.
- Request several quotes: Get in touch with leasing companies or dealers who have experience with start-ups and the self-employed.
- Compare the terms and conditions: Please note the contract term, the mileage allowance, what’s included in the package and any penalties for early termination.
- Sign the contract: Once the application has been approved and you have agreed to the terms and conditions, you will sign the lease agreement and the delivery will be scheduled.
What if your application is rejected?
A rejection doesn’t mean it’s the end. You can offer a higher deposit, choose a shorter lease term or select a cheaper vehicle. Sometimes it also helps to approach a different leasing company, as the criteria vary from provider to provider. Always ask for the reason for the rejection, so that you can make targeted improvements.
How we help start-ups with electric company car leasing
At Van den Hurk Commercial Vehicles, we understand that, as a start-up, you want to get things moving quickly and avoid getting bogged down in complicated procedures. We can provide you with practical assistance with the following matters:
- A wide range of electric commercial vehicles, including compact vans, double-cab commercial vans and refrigerated vans
- Personalised advice on which vehicle suits your work and budget
- Flexible leasing options, tailored to the needs of first-time buyers and the self-employed
- Transparent prices with no hidden costs
- Over 60 years’ regional experience in North Brabant and the surrounding area
Would you like to find out what options are available for your situation? Take a look at our full range of commercial vehicles or get in touch with us for a no-obligation chat. We’d be happy to work with you to find the best solution for your business, both now and in the future.
