Friday, September 12, 2014

Bicycle Leasing in Germany

A number of major German companies have latched onto the concept of offering their employees a company bicycle rather than a company car. The employees can use the bicycle as though it is their own, keep it at home, commute to work and use it for shorter trips for the company. This has been made possible by changes in German taxation law in 2012. The company leases the bicycles from dealer or from an agency that sources the bicycles from one or more dealers. The employee pays a monthly leasing rate, which is taken from his salary before he or she pays tax, unemployment or health insurance, i.e. he pays less tax and social insurance. After three years he or she can buy the bike for 10% of its original price. Over three years this yields a saving of over 40% of the original price of the bike.
The advantages for the employer are:
    • It has been found in studies in the Netherlands, that employees who cycle to work enjoy better health than those who commute by car or public transport.
    • It improves the green image of the company.
    • It is cheaper than a company car, but at the same time it makes for a cool image, especially these days where employees who live in city centres have difficulty parking cars.
    • There is less need to provide car parking which can be expensive to provide and maintain.
    • In cities a bicycle is fast, if not faster than a car up to about 5km, because there is no need to find a parking slot at the end of the journey which cuts down wasted time.
Over 400 German companies some of which are blue chip companies offer their employees subsidised bicycles:
    • DHL, logistics
    • Bayer, chemical industry
    • Deutsche Telekom
    • Allianz, insurance
    • Weleda, a multinational company that produces both beauty products and naturopathic medicines. Both branches design their products based on anthroposophic principles.
    • LBS, building society
    • Commerzbank
In addition many local utilities, town councils and tradesmen take advantage of the schemes.

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