Manufacturers of luxury cars are embracing hybrid technology to drive down CO2 emissions.
Technological developments surrounding hybrid vehicles, which combine an internal combustion engine with an electric motor, have resulted in the amount of CO2 produced tumbling.
And some of the world’s most prestigious marques are launching hybrid vehicles on Britain’s roads over the next 12 months.
But while many of these cars are likely to remain the preserve of director level staff due to their high price, they are nonetheless allowing the proportion of tax paid by employers and employees to be slashed.
Last month, Mercedes-Benz confirmed a new ultra-low emission version of the S-Class with official fuel consumption of 94.2mpg.
The S500 Plug-in Hybrid will be available in the UK from September 2014, with CO2 emissions of 69g/km.
It will also have an emission-free range of up to 18 miles which can be produced via a plug-in charge or charged by the engine when driving.
The new model has the potential to more than halve the benefit-in-kind costs currently paid by an employee for a Mercedes-Benz S-Class today.
The S-Class follows the unveiling in April this year at the Shanghai Motor Show of the Porsche Panamera Gran Turismo.
At the time, the manufacturer feted this vehicle as introducing plug-in hybrid technology to the executive segment for the first time.
In addition to being capable of accelerating from 0-62mph in 5.5 seconds, the Panamera hybrid has CO2 emissions of 71g/km and combined fuel economy of 91mpg.
Toby Poston, head of communications at the British Vehicle Rental and Leasing Association (BVRLA), said: “It’s my impression that many large fleets are waiting to see what real benefits some of these executive hybrid vehicles will bring.
“But I think that a major factor in their future success will depend on price – in short, they’ll be successful if manufacturers produce hybrid luxury cars with competitive prices.
“Otherwise, the prestige marques will simply remain the preserve of those running the businesses. The rental and leasing companies we represent will do a cost analysis to determine how effective these vehicles are.
“But I think that it’s great for the industry that the premium manufacturers are doing this.”
One of the companies that has led the way in the hybrid vehicle sector is Lexus.
The company is regarded to have pioneered hybrid vehicles and to date has sold more than 5.4 million of them worldwide.
Neil Broad, general manager of Toyota and Lexus fleet and remarketing, said: “Our ambition is to ensure that, by 2015, 50% of all the vehicles we sell are hybrids.
“That’s what we’re committed to achieving and the availability of hybrids across our entire range reflects this.
“In July this year, our IS300h went on sale which we regard as a critical car in the luxury sector.
“Not only does it have CO2 emissions of 99g/km but it also has combined fuel economy of 65.7mpg and is capable of accelerating from zero to 62mph in 8.3 seconds. We are witnessing an increasing amount of interest in this.”