CAP urges Renault to abandon ‘battery not included’ policy

Automotive industry analysts CAP has reaffirmed its decision not to forecast used values for Renault electric vehicles until the battery is included, rather than leased separately.

New Benefit In Kind tax rules for company car drivers will see the Renault Zoe’s battery replacement cost added to the car’s list price for P11D purposes. According to Fleet News, CAP has been in discussion with Renault over the issue of forecasting used values for a vehicle for which the battery is leased separately from the car.

CAP’s forecasters have maintained that it is not possible to forecast the value of a vehicle with no intrinsic source of power, likening it to forecasting the value of a conventional car with no engine.

Under the rules, which come into force in 2015, a company car driver choosing a Renault ZOE would pay BIK tax on the full list price
of the car before the government’s £5K plug-in grant is deducted. The driver would also pay BIK on the value of the battery, which Fleet News understands to be currently £7,392 including VAT for the model in Renault’s ZOE.

CAP believes HMRC has made a fair decision by including the battery in the BIK equation and argues that Renault should reconsider its position.

CAP’s manufacturer relationship manager Martin Ward, said: “HMRC’s decision to base the BIK on the total is only fair, otherwise Ford, for example, could deflate the P11D value of a Mondeo by excluding the engine.

“Our frustration with Renault’s approach is based on the fact that we believe the ZOE is a very good car that isn’t getting a chance in the all-important fleet market.”

“We have every confidence in the quality and reliability of the ZOE. We have seen it, driven it, lived with it and its 90 mile range means it definitely has a place in fleets for shorter range driving purposes. But until Renault removes the layer of complexity caused by treating the battery as a separate entity to the car, CAP will be unable to forecast its used values. And now it has emerged that HMRC is including the battery for BIK purposes the Zoe no longer has such an attractive P11D value for potential company car drivers.

“In our opinion it is now time for Renault to give some great electric vehicles they have worked hard to develop and refine a real chance in the company car market by abandoning its ‘battery not included’ policy.”

However, Dr Ben Lane, managing editor of Next Green Car, has welcomed Renault’s battery leasing approach as it effectively reduces the additional capital costs of EVs and spreads the costs across the lifetime of the vehicle. He stated: “Any system of vehicle financing that brings the up-front price of EVs closer to the costs of conventional cars should be applauded and used to help drive EV sales.

“The real issue here is not that the battery price forms part of the P11D price, its that HMRC has decided to remove the zero BIK rating for battery electric cars from 2015, at a time when the market will still be fragile. “If the Government wants to see significant numbers of EVs on UK roads in years to come, it needs to reinstate 0 per cent BIK rate for
EVs until at least 2020 to give company car and fleet EV sales a chance to grow beyond the ultra-early adopters.”

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