Ride-to-work program hits the sweet spot

New ride-to-work program hits the spot

The quest to get more New Zealanders on bikes is gaining momentum, thanks to new ride-to-work programme, the Wheel Deal, which makes it simple for employers, passes on huge savings to staff, all the while ensuring retailers don’t lose out in the process.

The Wheel Deal enables employers to support their staff to buy a bike, e-bike or e-scooter through pre-tax salary sacrifice. This, coupled with the removal of Fringe Benefit Tax, reduces the cost of a $5000 e-bike to around $3,500.

Co-founder Michael Titt is pleased with the response to date, with dozens of workplaces already on board. He is glad that salary sacrifice arrangements, common in Europe, are now gaining traction in New Zealand workplaces. He says, “Removing the barriers to buying a bike or scooter is a great way for a business to make good on their sustainability and wellbeing goals and be known as a workplace that walks the talk.”

While the Wheel Deal does charge a handling fee to dealers to cover costs, compared to other schemes the scheme has much less impact on retailers' margins, so there is a lot of goodwill as a result. Michael says, “We’re here to support New Zealand's entire cycling ecosystem and bike retailers play a crucial role in that.

Unsurprisingly, they’ve had a tough few years, with many forced to close their doors as Kiwis have tightened their belts on discretionary spending.”

Wellington-based businessman Aaron Rama recently purchased an electric commuter bike through the scheme. He chose a bike through the retailer Electrify and uses it to commute to and from his CBD office from his Ngaio home.

Aaron says “The savings passed onto the consumer through the Wheel Deal were almost too good to be true but what really blew me away was the service that followed - the guys at Electrify regularly check in and make sure I’m on top of any

maintenance issues. It’s early days but they may well have made a lifelong bike rider out of me!”

“I’m a big fan. There’s a lot of initiatives out there aimed at fostering wellbeing and active lifestyles in workplaces, but a lot of them fall flat. This one delivers the goods in quite a tangible way.”

“I’m now encouraging my staff to get on board, so they can reap the benefits too.”

When it comes to rolling the scheme out to large teams, Michael says, ‘We make it really simple. There’s only one purchasing option and it’s a 12-month salary sacrifice. Our paperwork has been developed by experts and there’s no ambiguity as to who owns the bike at any point. The ownership of the bike is transferred to the employee from day one.

Many other bike purchasing schemes opt for a leasehold arrangement, where the scheme provider ‘owns’ the bike until it’s fully paid off. “Our job is very much focused on reducing risk for employers, in both the short and long term.”

While each employer is different, the Wheel Deal helps employers tailor the programme in accordance with their cashflow situation, often in a phased way with a cap on the purchase price of a bike or scooter.

Co-Founder Dan Wallace says the response has been quite overwhelming. “An individual is free to choose a bike through any retailer in New Zealand via the Wheel Deal – they’re not limited to a specific brand or store which often surprises

people. We're also completely transparent about our business model. This is key. We’re here to nurture the whole cycling eco-system and make it more affordable for more Kiwis to get on bikes, taking advantage of the generous provisions already in place.”

“When someone buys a bike through the Wheel Deal, they also get a free service package. It might seem like a small gesture, but it’ key to building enduring relationships with local bike retailers.”

Looking ahead, Michael sees bike/scooter purchasing schemes via salary sacrifice being a standard employee benefit, like it is already in many other parts of Europe. He says, “It’s taken a bit for Kiwis to get their head around an employee benefit of this sort, but it’s certainly a concept gaining momentum, and early adopters will reap the biggest rewards.”

More information:

Co-founders Michael Tritt (Auckland) and Dan Wallace (Tauranga) are both available for interviews.

More information about the tax and bike purchasing in New Zealand can be found at:

https://www.deloitte.com/nz/en/services/tax/perspectives/july-2024-fbt-and-the-bike-exemption.html