Austria: A fleet market in development

In 2015, commercial vehicle registrations in Austria reached a new record level of 184,410 vehicles, 59.75% of total registrations, and stood 6,500 units (9.5%) above the 2014 figures.

However, the main share of commercial registrations was for short registrations of up to 120 days, followed by company registration and car rental.

The Volkswagen Group is the clear market leader among the brands with a market share of 34%. The VW brand tops the brand ranking at 17.3%, far ahead of Opel with 7.1% and Škoda with 6.8%

The total vehicle stock in Austria amounted to 6,545,818 units in December 2015. Of these, 4,748,048 were accounted for by passenger cars and approximately 400,000 related to commercial vehicles up to 12 tonnes.

Overall, new registrations in Austria have declined significantly in recent years. In 2015, 308,555 vehicles were newly registered, which represents a decline of 13.4% compared to the record year of 2011. In 2015, a slight upturn of 1.7% was recorded compared with 2014. The private car market has thus seen considerably weaker growth than the fleet market. The fleet market is therefore an important driver of the automotive trade in Austria too.

The diesel engine is still the most widespread engine in Austria and notched up growth of 0.8% in the first quarter of 2016, from 59% to 59.8%. This is in marked contrast to the European trend, where the diesel share decreased from 52.5% to 50.2%. In the fleet sector, the diesel engine accounts for 80% of all vehicles. This is due in particular to the tax incentives the diesel engine enjoys over the petrol engine.

New registrations of vehicles with alternative drive systems amounted to 5,901 vehicles in 2015, which translates into a share of 1.9% of total registrations. This represents an increase of 1,467 units compared to 2014, or 33.1%. The share of electric vehicles stood at 1,677 vehicles.

FLEET LEASING SECTOR

Leasing represents the most popular form of financing for Austrian companies. In 2015, 165,664 new leases with a volume of € 3,980 million were concluded, representing an increase of 10%. The total portfolio thus increased by 7.2% to 500,304 contracts with a volume of € 8,427 million. 

In Austria, outsourcing is not yet as popular as in many other European countries. Nevertheless, in recent years, the trend towards outsourcing fleet management has increased and recorded growth rates. LeasePlan and Porsche Bank are the biggest providers of fleet leasing, each with more than 30,000 vehicles, followed by Raiffeisen Fuhrparkmanagement with more than 10,000 company cars. The other providers have a vehicle stock of around 5,000 vehicles. As a provider of fleet management services, Fleet Logistics also has a subsidiary in Austria.

Due to the low market penetration, providers have also withdrawn from the Austrian market. Most of the time, they have gone on to service their Austrian customers from Germany. However, this is not an easy task due to the specifics listed below.

DIFFERENCES BETWEEN AUSTRIA AND THE REST OF EUROPE

A special tax in Austria is the standardised consumption tax (called NoVa for short). This is based on the fuel consumption of the vehicle. The basis for the calculation is the CO2 emission value in grams of CO2 /km, which is the combined consumption minus 90 grams. This value is divided by five. The result is the tax rate used to calculate the NoVa. The maximum tax rate is 32%. As in the UK, Austria also has a system that provides an incentive for low fuel consumption in company vehicles.

With the 2016 tax reform, the Austrian government has set further benchmarks for low-emission vehicles: vehicles with no CO2 emissions (purely electric vehicles) are generally entitled to deduct input tax, even if the vehicle is made available to the employee for private use. They are also exempted from engine-related insurance tax (road tax). This only applies to vehicles with zero grams of CO2 emissions, not to hybrids or other alternative engines.

In addition to this, the driver, even if allowed to use the vehicle privately, is not subject to any kind of benefit in kind (countervailing benefit). Given that there is no benefit in kind, the employer also does not have to pay the associated additional remuneration costs. This aspect and the saving made on the engine-related insurance tax, plus the general input tax deduction, offer clear advantages for the employer as well as the employee, and can amount to 20 - 30,000 euros over the service life of a company car.

CO2 emissions play a decisive role in the taxation of the so-called "countervailing" benefit for private use of the company car in the wake of the tax reform. If emissions are under 130g/km, the employee is taxed 1.5% of the acquisition cost, instead of 2%. However, this limit is set to drop steadily to 118g/km by 2020.

TRENDS IN THE AUSTRIAN FLEET MARKET

Henning Heise, Managing Director of heise fleet consulting, is observing a clear trend towards the environmental friendliness and sustainability of the vehicle fleet in his market. In 2015, this was given a further push through the implementation of the Energy Efficiency Act, on the one hand, and the 2016 tax reform, on the other. In a survey conducted by him among fleet operators, just under 75% of companies stated that environmental friendliness plays an important role in the vehicle fleet.

 

Authored by Thilo von Ulmenstein, fleetcompetence europe GmbH