Login
ISCOVER
Wholesale aggregator LMG has seen a 65 per cent increase in novated lease referrals in a year, as more brokers refer this business internally.
A spike in strong demand for electric vehicles (EVs) and plug-in hybrids (PHEVs) – driven by the federal government’s fringe benefits tax (FBT) exemption for zero or low-emission vehicles – has resulted in a surge in novated lease referrals, according to major aggregator LMG.
According to the group, there has been a 65 per cent year-on-year increase in novated lease referrals, with more LMG brokers referring these internally through the group’s new asset finance marketplace, Asset Finance Exchange (AFX).
Speaking of the spike, Jordan Mutton, general manager of AFX, said: “The introduction of the FBT exemption opened the door for more Australians to consider EVs and PHEVs, and brokers are now well-placed to help clients take advantage of these savings.”
Indeed, data from the Electric Vehicle Council and public sources revealed that about 114,000 new battery electric vehicles (BEV) and plug-in hybrid electric vehicles (PHEV) were sold in Australia in 2024, up on the previous record of more than 98,000 sales in 2023.
Around 23,000 of these were PHEVs, partly driven by the fact that PHEVs ceased to be considered as zero or low emissions vehicles under fringe benefits tax (FBT) law from 1 April 2025.
Data released by the Federal Chamber of Automotive Industries has also shown that 4,871 PHEVs were sold in February 2025 – a monthly record for the Australian market.
This represents a 346.1 per cent increase compared to February 2024, contributing to a 222.2 per cent overall rise in PHEV sales for 2025.
Simon Southwell, CEO of Positive Salary Packaging, said: “We’ve seen a broader range of EVs enter the Australian market, with more affordable options like BYD and MG EV boosting demand. While Tesla’s popularity dipped in 2024, the overall EV market has surged.
“As we approach the PHEV exemption deadline, we’re seeing a continued push in plug-in hybrid sales and expect a rise in EV demand to follow in the latter stages in 2025, supported by the ongoing FBT exemption for zero-emission vehicles.”
Similarly, Mutton said that the EV and novated leasing space would continue to be popular with consumers, highlighting that more than 40 new EV models are expected to hit Australian roads by the end of 2025.
LMG said that more brokers were referring on novated leasing business through AFX, enabling them to “expand their services and grow their businesses without adding complexity”.
More lenders looking at EV and car finance
The rising popularity of electric and hybrid vehicles has seen more lenders and groups ramp up novated leasing and asset finance offerings in the past year.
In September, CBA released small-business data showing a 553 per cent increase in demand for hybrid vehicles during the financial year ending June 2024, while finance for electric vehicles was up 254 per cent.
More lenders have also been moving into car finance, with Resimac Group Ltd (Resimac) in October agreeing to purchase the portfolio of auto loan receivables and leases from Westpac Banking Corporation in a deal worth up to $1.6 billion.
Non-bank lenders, such as Pepper Money, MONEYME, and Metro, have also worked to offer options that meet demand for “sustainable” asset finance products.
[Related: New EV sales roar to record high as car financing accelerates]
JOIN THE DISCUSSION