Why Luxury EVs will still be popular in 2026

2026 - Why Luxury EV's will still be popular

In what has been a mixed few weeks for electric vehicles, with the “pay per mile” sticking as the most talked about piece, there seems to be some resoundingly great news for the cheaper EVs in the UK.

As at 3 December 2025 there was a significant update in the EV industry with the Government announcing some big grant changes as “four more EV models qualify for £3,750 discount …” under the Electric Car Grant . As you can read in the article, there are some great ECG additions with the following models to be offered the Band 1 support:

• Alpine A290
• Mini Countryman
• Renault 4 ; and 
• Renault 5 52kWh

In effect, this means that the vehicles noted above will receive an additional £2,250 under the ECG  bringing the list to 8. With the Citroen e-C5, Ford Puma EC and Nissan Leaf already receiving this robust support, this is excellent news for the personal and SME customers we operate within the cheaper / cost-effective EV segment.

Under the recent Autumn budget, the Government confirmed a £1.3 billion investment into the ECG and a commitment to extend this for another year. A further £200 million has been confirmed for ChargePoint rollouts across the UK to enable more customers make the transition too.

Since July 2025, over 40,000 drivers have benefitted from the ECG which is enabling more UK customers make the move into BEV technology. With some resounding statistics on the new car front, with some months resulting in over 25% of the registrations being zero-emission, there is evidence that the political and economic impact is having a positive outcome.

However, in noting the charging conundrum, the Government are also aware that one of the key incentives behind the BEV transition is the lower running costs especially with fuel. With some overnight tariffs now well below 10 pence per kWh, this means a cost of around 1 - 2 pence per mile. When you compare this to the 15 pence for a petrol or diesel equivalent, the economic realities soon focus your attention. In addition, a move by the government to address energy prices in our domestic households and in the public domain are very much the boost we need for 2026 and beyond in the electric car industry!

On the other side of this debate is the luxury and performance EVs which are still being produced and innovated with consistency by many brands. As we have been writing about recently, the upcoming Porsche Cayenne EV is the epitome of design, engineering and technology, making more PCH and BCH customers even more excited about the future of this tech.

The beautiful EV shown here, the Polestar 4, is another great example of what a vehicle can offer you or your business. It is the latter entity which still remains the backbone of the UK’s zero-emission economy via SME, fleets and salary sacrifice schemes.

As the Government continue to offer many benefits for a company going electric, the popularity of luxury options will continue. With Corporation Tax set at 25%, businesses need to employ tax efficient practices. As the lease rental is 100% allowable against this tax or 100% write down allowable until 31 March 2026 (Hire Purchase and Contract Purchase), the use of company funds makes complete sense.

When you add the VAT saving, with 50% on finance element and 100% on the maintenance aspect, this only increases the reward. Charge points at home or work are completely allowable against tax (under full expense rules) and electricity is not considered a fuel for tax.

While some may say there are drawbacks or cons to business leasing with an EV, it is difficult to legitimise this argument. For the driver of the car, director or employee, the amount of tax they pay for the benefit - Benefit in Kind (BiK) - remains relatively nominal.

From 2022 - 2025 this was set at 2% with 2025-2026 increasing to 3%. While the rate of BiK will increase to 9% by 2029 - 2030, this is some margin away from a traditional petrol or diesel option which will incur 25% - 39% BiK.

To calculate your car tax exposure, simply utilise the vehicle value (P11d), your income tax threshold (20, 40 or 45%) and apply the BiK rate. Road fund licence is another area which is useful on costs, with just a £10 first year cost for 0g/km vehicles, this offers a big saving against other luxury options which can incur up to £5,490 in their first year tax!

To encourage the sale of EVs even further, the Expensive Car Supplement of £425 which starts from the second year of the car's registration, now only applies to an EV which costs beyond £50,000. While this means many of the elite EVs will incur it, some robust options may just avoid it.

The Polestar 4 electric car lease

The Polestar 4 is a great example of what manufacturers can do with their vehicles. The model shown here, which we enjoyed at a recent Fleet Procure conference, is their top specification - the 400kW 100kWh LR DM Prime [Performance] 5dr Auto. A new breed of EV, this is a sleek aerodynamic coupe SUV which offers both practicality and functionality but with that dynamic twist.

As standard, the car includes hill hold and descent control, rain sensor, wireless smartphone charging, wireless apple carplay, exterior cameras, 12 ultrasonic sensors, adaptive cruise, front/rear park assist, power-operated tailgate, 10.2” LCD display, HUD, 15” central display, electrically adjustable and folding door mirrors, automated headlights, heat pump, front memory seats, alarm with interior sensor and trailer stability.

You can add the Prem Pack which includes both the Pilot and Plus Packs, along with the privacy glass. The Pilot Pack adds Pilot Assist and Lane change assist. The Plus Pack includes Harmon Kardon, HUD, Pixel LED lights, 12-way adjustable seats, heated steering wheel, 3-zone climate control, air filtration and 22kW AC charging. The Performance pack adds 22” alloys, engineered chassis, Brembo brakes and Swedish gold accents. In terms of other options, consider the fully electrically retractable towbar.

Configure your bespoke Polestar 4 option 

How will the new Polestar 4 perform?

• Long Range Dual Motor - this AWD SUV will have a 94 kWh usable battery which will offer 0 – 62 times of 3.8 seconds,124 mph top speeds and 400kW (or 536hp). Expect a combined winter range of 255 miles with warmer weather allowing for 340 miles – a 300 mile combined. On charging, the 22kW AC max will allow 5 hour and 15 min 0 – 100% charging times with the 200 kW DC maximum allowing 31 minute 10 – 80% times. A cargo volume of 365L is available with this car. It has a vehicle fuel equivalent of 129mpg. You can tow 750kg (Unbraked) and 2000kg (Braked). The new Polestar 4 has Bidirectional Charging. The Heat Pump is available as a standard option.

Want to know more about going into the Polestar? Head to our dedicated special offers section or speak to our experts directly on 01942 910 001 or by emailing us at [email protected]