As the world continues to embrace sustainable transportation, New Zealand is seeing strong growth in hybrid and electric vehicles (EVs) on its roads. While government purchase rebates for EVs no longer exist in NZ, there are still practical and accessible ways for Kiwis to finance a hybrid or EV - and the lower running costs are often worth factoring in. In this article, we'll walk through the finance options available and what to think about before you commit.
Quick summary for financing a hybrid or EV in NZ
- • Standard vehicle loans apply to most hybrid and EV purchases
- • Fixed interest rates for vehicle loans in NZ range. For example, interest rates via Motor Vehicle Finance at the time of writing this range from 7.95% p.a. to 29.95% p.a. Note your actual rate will depend on your credit history, the vehicle, and the lender.
- • Some NZ banks offer green car loan rates for EVs - worth asking about when you enquire
- • Leasing and subscription options are available as an alternative to ownership
- • For used EVs - always run a PPSR check before purchase
- • Running costs for EVs are typically lower than petrol - factor this into your total cost of ownership calculation
- • The Motor Vehicle Finance team can assess your situation and work to match you with a suitable lender
What's changed for EV buyers in NZ
The NZ government's purchase incentives for EVs have wound back. The Clean Car Discount - which offered rebates for EV and hybrid purchases - was scrapped in December 2023 and has not been replaced. From April 2024, EVs also lost their road user charges (RUC) exemption.
What this means for buyers:
- Battery electric vehicles (BEVs) now pay $76 per 1,000km in road user charges
- Plug-in hybrids (PHEVs) pay a reduced rate of $38 per 1,000km - as they also pay fuel excise duty at the pump
- Standard petrol hybrids that don't plug in pay no road user charges
- There are no government purchase rebates currently available for private buyers
Rates are subject to change. Source: beehive.govt.nz
That said, EVs still typically have lower day-to-day running costs than petrol vehicles - lower fuel costs, lower servicing costs, and fewer moving parts. For many buyers it still makes sense, especially over a longer ownership period.
Green car loans from NZ banks
Some NZ banks offer preferential interest rates on loans for electric vehicles - sometimes called 'green car loans'. These are typically structured as home loan top-ups for existing mortgage holders, or as dedicated EV loans from select lenders. Promotional rates may revert to standard rates after an initial period, so it's worth understanding the full terms before applying. Worth asking about when you enquire.
Specialised Loans and Financing Packages:
Apart from bank-level green car initiatives, there are some financial institutions in New Zealand that offer specialised loans and financing packages designed specifically for hybrid and electric vehicles. These options make it easier for individuals to purchase an eco-friendly vehicle without straining their finances.
One such financing option is the dedicated electric vehicle (EV) loan, which can offer more favourable interest rates and flexible repayment terms. These loans can often come with additional benefits, such as discounted insurance rates and extended warranties. By tailoring the loan terms to the specific needs of EV owners, these financial institutions provide a streamlined and accessible financing solution.
Here's what to expect when financing a hybrid or EV through a standard vehicle loan in NZ:
- Fixed interest rates for vehicle loans in NZ range. For example, interest rates via Motor Vehicle Finance at the time of writing this range from 7.95% p.a. to 29.95% p.a. Note - your actual rate will depend on your credit history, the vehicle, and the lender.
- Loan terms typically run from 12 months to 84 months
- Fees apply - including an establishment fee of up to $350 and an introducer fee of up to $995
- A secured loan uses the vehicle as security - which can help you get a better rate
- For a $30,000 EV loan over 60 months at 12.95% p.a. - indicative repayments are around $682 per month. This is an example only - actual repayments will vary based on your circumstances and the lender
The Motor Vehicle Finance team assesses your situation and works to match you with a suitable lender from our panel. Subject to eligibility and lender criteria.
What to think about before financing an EV
EVs have some specific considerations that don't apply to standard petrol vehicle loans. It's worth thinking through these before you commit:
Battery condition and age
The battery is the most expensive component of an EV. For used EVs, check the battery health report if available - degraded batteries affect range and resale value. Some lenders factor battery age into their lending criteria for used EVs.
Resale value
EV resale values in NZ have softened since the removal of the Clean Car Discount. Factor this into your decision if you plan to sell or trade in before the loan is paid off - you don't want to end up in a negative equity position.
Charging infrastructure
Consider where you'll charge - at home, at work, or on public networks. Home charging requires a compatible charger installation which is an additional upfront cost. This doesn't affect your loan directly but is part of the total cost of ownership.
Road user charges
As noted above, EVs now pay road user charges. For average annual travel of around 14,000km, BEV owners are looking at approximately $1,064 per year in RUCs. Factor this into your running cost calculations.
Buying a used EV? Always check the PPSR first
The Personal Property Securities Register (PPSR) is the official NZ government register where lenders record their security interest in a vehicle. If a used EV has finance owing and the security interest hasn't been cleared, the lender can repossess the vehicle from you as the new owner.
Check at ppsr.companiesoffice.govt.nz for $3 before committing to any used vehicle purchase.
Leasing and subscription options
Leasing and subscription services could act as a flexible alternative to traditional car ownership. Several companies in New Zealand offer electric vehicle leasing and subscription options, allowing individuals to experience the benefits of driving an EV without the long-term commitment of ownership.
Leasing may suit you if:
- You want to drive a newer EV model without committing to ownership
- You prefer fixed monthly costs with maintenance included
- You're a business looking to electrify a fleet vehicle
- You're not sure about committing to EV ownership long-term
Keep in mind that leasing means you don't own the vehicle at the end of the term. If ownership is your goal, a standard vehicle loan is likely the better path. The Motor Vehicle Finance team can assess your situation and discuss your options. Subject to eligibility and lender criteria.
The bottom line
New Zealand's EV market has changed significantly since 2023. Government purchase incentives are gone, and road user charges now apply. But the fundamentals still work for many buyers - lower running costs, lower servicing, and a growing charging network make EVs a viable choice for a lot of Kiwis.
Whether you're an individual looking to purchase a hybrid or electric car, a business interested in transitioning your fleet, or someone seeking short-term sustainable mobility, there are various financing options tailored to your needs. The key is understanding the full cost of ownership - not just the purchase price - and finding a loan that fits your budget and timeline.
Frequently asked questions (FAQ)
Can I get a car loan for an electric vehicle in NZ?
Yes. Standard vehicle loans apply to most hybrid and EV purchases. Some lenders also offer dedicated green car loan rates for EVs which may be more favourable. The Motor Vehicle Finance team can assess your situation and work to match you with a suitable lender from our panel. Subject to eligibility and lender criteria.
Are there still government incentives for buying an EV in NZ?
No - not for private buyers. The Clean Car Discount was scrapped in December 2023 and has not been replaced. From April 2024, EVs also lost their road user charges exemption. Some banks offer preferential green car loan rates, and business fleet incentives may still apply.
What are road user charges for EVs in NZ?
From April 1, 2024, battery electric vehicles pay $76 per 1,000km in road user charges. Plug-in hybrids pay $53 per 1,000km. There is also an administration fee of around $12-$13 when purchasing RUCs.
Is it worth buying an EV in NZ without the Clean Car Discount?
It depends on your situation. EVs typically have lower running costs than petrol vehicles - lower fuel costs, lower servicing, and fewer mechanical components. For many buyers the savings over time offset the higher purchase price. It's worth adding up the full cost before you decide.
What should I check when buying a used EV in NZ?
Check the battery health report if available, run a PPSR check at ppsr.govt.nz to confirm no finance is owing, check the WoF and registration, and get an independent inspection. Battery condition is the most important factor specific to used EVs.
What interest rates apply to EV loans in NZ?
Fixed interest rates for vehicle loans in NZ range. For example, interest rates via Motor Vehicle Finance at the time of writing this range from 7.95% p.a. to 29.95% p.a. Note - your actual rate will depend on your credit history, the vehicle, and the lender.
Can I lease an electric vehicle in NZ?
Yes. Several NZ companies offer EV leasing and subscription options. Leasing gives you fixed monthly costs and no long-term ownership commitment, but you don't own the vehicle at the end of the term. It suits some buyers more than others depending on their goals.
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Disclaimer: Please note that the content provided in this article is intended as an overview and as general information only. While care is taken to ensure accuracy and reliability, the information provided is subject to continuous change and may not reflect current developments or address your situation. Before making any decisions based on the information provided in this article, please use your discretion, and seek independent guidance. Motor Vehicle Finance is a trading name of One Partner Limited (FSP403346), which holds a Class 2 Financial Advice Provider Licence issued by the Financial Markets Authority.
