Westpac offers lower rates for auto loans for electric and hybrid vehicles
“We expect demand for these vehicles to continue to grow, with many Australians already planning to make the switch.”
Non-bank lenders Plenti and Pepper Money have targeted the EV space, with the latter offering a comparison rate of 3.99%.
Although Westpac research showed more than two-thirds of Australians were put off by the cost of electric vehicles, Plenti released a report in March that showed electric vehicles could be cost-effective against internal combustion engines in 15 years when are associated with renewable energy sources.
Easing Household Fiscal Pressures
“We know that the majority of Australians are now actively considering an electric vehicle as their next car and this initiative will help them make the switch. Given that an average Australian household currently spends $3700 a year on petrol and diesel, the Purchasing an electric vehicle would ease the real pressure on the monthly budget,” said Electric Vehicle Council Director General Behyad Jafari.
Plenti’s research has shown that electricity bills could be as low as $230 per year when electric vehicles and green energy are bundled together. The emerging non-bank lender announced on Wednesday that it has reached a financing agreement with an electric vehicle manufacturer, after reporting its first positive result in cash, supported by growth in auto loans.
Its auto loan originations increased 177% to $639 million from a year ago, resulting in full-year net cash income of $500,000 and loan originations of $1.1 billion up 134% year over year. In the second half of this year, the cash profit was $2.7 million.
“Automotive remains the largest and highest growing vertical and is poised for accelerated near-term growth with the launch of commercial auto loans, financing deals in the electric vehicle market and the launch of a dealer point-of-sale program,” said Wilsons analyst John Hynds. .
Mr. Hynds warned that funding cost increases would take time to be passed on to lending customers, limiting projected cash profit for the first half of 2023 to $3.4 million.
“In the second half of 2023, expectations are for improved net interest margin and therefore stronger loan book growth and expected net income of $9.2 million,” he said.