As the Federal Government reviews the Electric Car Discount and the Fringe Benefits Tax (FBT) exemption for eligible electric vehicles, the fleet sector is watching closely.
For organisations planning multi-year fleet replacement programs, sudden policy shifts can materially alter total cost of ownership modelling and salary packaging demand. Kristian Handberg, General Manager – Future Business and Origination at JET Charge, says the key risk isn’t necessarily reform — it’s how reform is delivered.
“We obviously have a vested interest, since it’s going to be good if it continues,” Handberg said. “But I do appreciate the reasons for why it’s being put under review.”
The Risk of a Sudden Shift
Handberg’s concern centres on the potential for abrupt change.
“My hope would be, if they’re going to change it, they’ll change it in a way that allows us to manage that through, as opposed to it just being a cold shower,” he said.
For Fleet Managers and Finance Managers, the implications are significant. The FBT exemption has been a major driver of novated lease EV uptake, particularly in medium SUV segments. If withdrawn suddenly, demand patterns could shift quickly.
Handberg points to previous experience in adjacent industries as a cautionary example.
“I’ve certainly lived through it with solar, for instance, around feed-in tariff changes,” he said. “They do result in a massive surge in interest in the lead-up to it being withdrawn, and then it just completely drops out of the market.”
Surge, Then Stall?
A similar pattern in the EV sector could create volatility for fleets and suppliers alike.
“There’s a massive surge in interest in the lead-up to something changing,” Handberg explained. “And then you’ve got to manage through the change in your situation as a result of the customers just drying up.”
For fleets, that volatility complicates planning cycles. A rush of novated lease orders ahead of a policy deadline could distort procurement schedules and infrastructure planning. A post-withdrawal slowdown could then stall momentum in electrification programs.
From a supplier perspective, the challenge is balancing capacity with unpredictable demand swings. But for fleet operators, the concern is strategic consistency.
Broader Decarbonisation Objectives
Handberg emphasises that the FBT exemption should be viewed within a wider policy framework.
“There is a higher-level policy objective around trying to decarbonise the economy,” he said.
Fleet decarbonisation strategies typically span three to five years, aligning with lease cycles and asset replacement schedules. Abrupt changes can disrupt those pathways, particularly for organisations still building internal maturity in whole-of-life cost modelling.
“If they’re going to change something, can you change it gradually and view that holistically,” Handberg said.
What Happens Next?
Handberg suggests that if the exemption were withdrawn entirely, growth in EV uptake may not collapse — but it could plateau.
“I don’t know whether the EV market growth will be sustained if it’s withdrawn,” he said. “It might just plateau, I think. But we’ll just wait and see.”
For Fleet Managers and Sustainability Managers, the message is clear: policy settings remain a material variable in electrification planning.
While the total cost of ownership case for EVs has strengthened — particularly as purchase price gaps narrow — salary packaging incentives have accelerated adoption in specific segments. Any adjustment to those incentives should be factored into 2026–2028 fleet modelling scenarios.
The sector does not necessarily require permanent subsidies. But stable, predictable policy settings allow organisations to build capability, update fleet policies, and implement infrastructure strategies without reactive disruption.
As Handberg’s experience suggests, the difference between reform and shock is often timing.
For fleets, avoiding a policy “cold shower” may be just as important as the incentive itself.
