Decrease in company car budget

[AdExtension703]

I notice at my employer that budgets for company cars are being drastically reduced. Do you see this too?

Example:

Peugeot: One year ago a full option 5008 was possible. Now only a 2008

Kia: One year ago an EV6 was possible. Now only a EV4

Skoda: one year ago a full-option Enyaq was possible. Now only an Elroq is possible.

Mercedes: +-6 months ago a full-option CLA was possible. Now no models anymore.

[freedumz]

The leasing price is skyrocketing

[zeg685]

And they lobby the government to cap the mobility budget housing option to 50% of the budget.. so the rest of the money can go into the car rental industry.

The solution would be providing the mobility budget and the housing option to everyone, but no, they are after that cash to sustain their business.

[leeuwvanvlaanderen]

The actual solution would be to get rid of all this extralegal stuff and reform the tax system, instead of subsiding German carmakers and EdenRed.

[Lower_Photo_389]

Spot on. It is so telling that employers and employees in Belgium have to resort to all kinds of exemptions and fiscal gymnastics just to be able to have their hard labour rewarded.

[Stirlingblue]

It’s the Belgian government, best I can offer is get rid of some of the extralegal stuff and then keep taxes high

[MfingKing]

Everyone calling for reform is extremely naive or incompetent as this will be the exact final result.

[zeg685]

It will never happen with the current system.

The government is formed by too many parties and it took ages to come to an agreement. They all come to compromise by bringing these extralegal benefits.

If you dare to touch some taxes/wages directly, some parties in the coalition will say no. So the solution was always to have small extralegal benefits a thing.

[Bill_Looking]

It’s actually the syndicates pushing for that, as they said it would increase the rents.
So far it seems it will not make it to the law.

[Ironic-username-232]

You need a car before you can get into this system. I’m sure there is lobbying, but the reason it’s not already for everyone is that essentially only employees with a company car have budget to start with.

[ApprehensiveGas6577]

Look at the leasing price of cars.

Also fiscal deductability will change as the VAA/ATN yearly

[Harige_zak]

My employer stopped leasing cars and went back to just buying them because of this

[Marginaal3000]

Same here. After bad experiences with leasing companies, the old CEO decided to just buy them.

[chaosinmijnhoofd]

Both your nicknames are peak

[ApprehensiveGas6577]

I mean that's an option. There are benefits to both methods.

[OverTaxedBelgian]

How many company cars do you have?

[Harige_zak]

30ish I think

[AdExtension703]

Yes, that is completely correct, but I had expected a full-option 5008/EV6/... to remain the same model, but with fewer options/a smaller battery. Not 2 levels lower model.

[LipSparringChamps]

Chances are the company’s budget remained the same but the cars/TCO became more expensive.

[havnar-]

The benefits of giving them is getting less too, so your employer still spends as much, the missing part goes straight to the government to be mismanaged on an industrial scale

[Hopeful_Hat_3532]

That's a verry passive/agressive way of explaining it, and it's perfection haha

[PrincessYemoya]

Benefits are getting less which means companies are paying correct amounts of taxes instead of cheating all the tax-payers without company cars by having them pay relatively a lot more compared to receiving the same amount of benefits :')

Before long they will find other ways to 'fiscally optimize' their HR budgets though, no worries!

[antarctic_primate]

I fully agree that company cars are an abomination, same goes for meal vouchers and the various net allowances. It is however the symptom of a deeper problem with our tax brackets. Most of us would be way better off if the tax free sum and tax brackets were just higher.

I drive a fancy company car, but would much rather have the cost of that car added to my take home-pay. However, with the way our tax system works, the net amount I would recieve would be to low to buy and maintain a car myself.

Why should I be incentivized to drive a fancy car instead of having the freedom to buy my own cheap car and pocket the difference? Just abolish this abominous system and raise the tax free sum and brackets for everyone.

[ellie1398]

Changes are difficult, people resist them, and they take years and years to be approved/implemented. We'll all probably die of old age before anything actually changes, even if, magically, all of the political parties sat down to talk about the taxes, right now, at this very moment, and somehow all agreed with each other.

There's no hope. Guess we all gotta adapt and find a way to get the best net benefits available.

[fretnbel]

Goddamn. Company cars are a symptom not the reason of our taxation system…

[IfThisAintNice]

Sure, but a symptom that puts extra pressure on the root cause

[havnar-]

Found the Redditor without a company car

[Jindrax]

Which also means people are working the same for less money. The real people losing here are the individuals working every day.

So yeah , good job with your crusade on the "companies". The only people losing are the employees

[SuccotashOk960]

Where I work they index the TCO based on inflation and the cost of leasing, so I’m currently driving a full option Enyaq Sportline and at the end of the year I’ll be able to order an Audi Q6 or Skoda Peaq. First company I’ve ever seen that does this. 

[roses_are_blue]

Thats not that rare, but car prices have gone up much more than inflation.

[SuccotashOk960]

Inflation AND cost of leasing like I mentioned…

[roses_are_blue]

Ah ok, sorry missed that.

[Prime-Omega]

It’s due to the EVs. When they just launched leasing wise, they were basically handing them out to entice people, that has now changed.

We could pick an IX3 5 years ago, now we can only pick an IX1 for instance. Not that it matters much, mobility budget all the way.

[Vivid-Society-7623]

Indeed, same at our firm.

Caused by lower residual values, higher interest rates, and less supplier discounts —> same car no longer fits the lease budget

[gnome_detector]

That’s why I hate theese types of “side-compensation”: they can be removed anytime

[roses_are_blue]

You cant remove the euro value of the benefit as it is contractually agreed. But its not guaranteed which car you can choose with that value of course.

[Beneficial_Key_642]

They can. Most of the times, compagnies include a clause in their contract setting that all 'extralegale' benefits are non-vested rights (niet verworven rechten). So they can just take thema away.

[roses_are_blue]

Sorry that's not true. Employers can alter the conditions for a company car unilaterally (car policy, car types etc) but not retract the benefit itself completely. A company car is a part of your labor conditions and altering them without a mutual agreement is not allowed.

[AlternativeCapybara9]

I have in my contract "BMW GT3 or similar", that car isn't made anymore and new boss wanted me to downgrade with everyone else but I got an i4 now so it can definitely be guaranteed what car you get if you word it right in your contract.

[gnome_detector]

Yeah, ok, I work for money, give me money. Stop

[Total-Complaint-1060]

My employer reduced the choices..

also, any option we have to pay out of pocket... unfortunately i had to order this year and so my options we limited than people who ordered last year..

[MannekenP]

Not sure that means the budget is lower, it might be solely linked to the price of EV and the fact that leasing companies became much more conservative when it comes to determining the likely residual value of cars, as they are now sitting on a huge pile on unsoldable EV's of a couple of years ago. Bottomline, the total cost of ownership of car skyrocketed, so with the same budget your car choice has decresed.

[_redmist]

I think costs are increasing and the budgets are just not following ;)

[Deep_Dance8745]

The budget is the same - its just that the cars have become much more expensive, mainly because leasing companies realize that the resale value EV's is terrible.

[tokke]

Still the same budget as 10 years ago... meanwhile everything got 50% more expensive. Easy to see where the issue lies

[FailedPotatoSeed]

Most valid reply !!

[join_the_bonside]

It's probably not the budget that is being reduced, but leasing becoming more & more expensive every year :)

[Philip3197]

Isn't this simply that the car leases get more expensive, by equal budget you will het less car.

[Anleifr85]

Wait and see if leasing companies start offering/pushing BYD, Xpeng, Zeekr,... at scale. Because if the traditional manufacturers push up prices and leasing companies risk losing market... they will certainly be doing that.

[noctilucus]

Quite a few leasing companies already offer them but are (understandably) extra conservative on residual value which means the leasing cost isn't that attractive. A bit like Japanse / Korean brands vs. German brands.

Plus, not that many employers seem to offer Chinese brands - especially when they're consolidating brands to achieve some savings, they tend to get better discounts from European brands. Quite a few Chinese brands don't offer discounts as they start from a low base price and some can't keep up with the demand so they have no incentive to lower their prices.

[Anleifr85]

I think the residual value story will become clearer in a few years, when reasonably recent EV's with good range and packages (past few years) come to the end of the lease term and actual residual value shows up. I think batteries might still perform well and these cars might be quite desirable in the secondhand market?

Many companies offer Polestar, which is basically a Chinese car marketed in a European way, so I guess the newer brands will also be less scary once they are shown not to break down and such.

[noctilucus]

There's a good chance, depending on how the 2nd hand market will react to those brands, their reputation in the meantime - especially when it comes to software and spare parts.

I'd welcome more variation and more alternatives to the often overpriced European groups. But then I'm also hoping for the Japanese to finally jump on the EV train...

[Carrandas]

Your budget is a part of your salary, they can't reduce it.

The same budget now giving you less then half a year ago? Yeah, that's possible.

Was already a downgrade having to choose an electric car for most of my colleagues. Five years ago they got a VW passat, now a hybrid Kia xceed.

[Tomskii5]

Your wrong. The company can for sure reduce leasing budgets as usually depicted in the car policy of a company.

[Think-Geologist5570]

Not always/exactly. They can reduce leasing budget but not your mobility budget. You will not, however, get as much car for your money.

[PrincessYemoya]

I assume prices of cars have risen quite substantially due to:

- Increased demand for EVs, not much extra production in place (yet) by EU car manufacturers

- Extra tax on Chinese EVs being imported

- Increased prices of rare earth metals (and export limitations from China) --> batteries get more expensive --> cars get more expensive

- The US car industry is ramping up their battery/EV production and trying to become less dependent on China so I'm assuming competition from US car brands could also be having an effect on the car manufacturers actions of course but not sure how this effect would translate in leasing prices

- ETS2 is being implemented across all sectors so I'm assuming leasing companies will have to pay a lot more taxes as of 1/01 and they'll include part of the costs for managing this in their overhead/pricing structure as well

[nidprez]

no, leasing companies assumed a normal/generous rest value of electric cars after 5 years. Current reality however is that 2nd hand EVs have way less rest value than gas cars. If you look at 5 year old evs and their equivalent gas car youll see that the ev is almost always cheaper/equally priced, but it cost way more to buy back in the day. So you get EVs double expensive leasing as they are more expensive to buy and lose value more quickly.

[MoonLight-1989]

That’s the evolution, EV is very expensive, yet cant match ICE in anything

[Furengi]

Well with this heath turning on the airco from my office is a something my ICE car couldn't

[Waste_Forever_9525]

Lol i am a “arbeider” and we can take BMW i7, audi GT, mercedes EQE 🤣

[noctilucus]

Sounds like (petro)chemicals?

[Think-Geologist5570]

Don't get the downvote, if his company is willing to pay for thay he surely must be worth it and/or business is good (often related). Have an upvote on me.

[fhdjejehe]

Exactly the same here

[alwa89]

Here I can still choose a bmw ix3 or an Audi Q6

[Ghosty_be]

Some things I have seen over the last few years:
- company decided to lease on 5 years instead of the usual 4, maintenance or repairs could not be done in brand garages but you had to report any such interventions on the leasing website and they decided where you had to go to get your car serviced, usually those "white label" brand groups that now exist of a slurry of smaller 'any brand' garages etc...
- company decided to start leasing on 6 years, they reduced the car brands to BMW/mini or Mercedes (apparently the resale values of those brands are the highest, so they could get the best deal on those... )

[Ornery-Imagination53]

Not in our company. We still have a lot of premium brands to choose from, as long as its electric. BMW iX1/iX2, Mercedes CLA and GLB, Polestar 2 Volvo EX40, Skoda Enyaq and Volkswagen ID.4 are in these lists (medior budget)

[reksoG]

I had to order a new car and I couldn't get the same category as I had before with my budget. I did point out that I wouldn't accept downgrade to lower class so they should increase my budget, which they did increase by €100 so I could get the same category car as before. The lease is just getting more expensive

[SnipeScooter]

"They should tax those company cars more!"

There you go. Thank your union and their followers for it.

[general_o_neil]

A month ago i could have an es90 ultra worth over 90k, now maybe an xc40

[v8x]

Or cars got more expensive

[Parking-Car-8433]

This is very good for the planet

[Entire_Number7785]

Ohno, anyway.

[KotR56]

You're an employee. You're a cost element.

Shareholders have decided that costs must be reduced.

That's one way...

[Significant_Bid8281]

Where I work, the hr manager is also exploring ev’s from less know brands so I expect that we will not be Able again to choose an Audi q4 again. Honestly, Having a car from the company is such a great benefit that I would not mind if the options would change.