Leasing vs buying an electric car
For anyone looking to get behind the wheel of a new electric car, one of the biggest hurdles to face is choosing the best financing method that aligns with the individual circumstances. From leasing to hire purchase or traditional PCP, there are a few different routes to take.
Leasing is becoming one of the most popular financing methods, particularly with drivers who like to change their vehicles every two or three years, enjoying the latest technology and safety equipment. With benefits for both personal customers and those buying through their business, in this article we’ll explore why electric car lease deals are so in-demand.
What are the benefits of leasing an electric car?
- Avoid higher purchase costs
Electric cars are more expensive to purchase outright when compared to their combustion engine competitors. The higher manufacturing and battery costs that come with building an electric car result in higher On The Road (OTR) prices.
The increased costs that come with an EV have resulted in a common myth that they are unattainable for many. However, by leasing an electric car one can spread the cost of the vehicle over a set term period. Although drivers are not committing to owning the vehicle at the end of their lease term, they can drive away in a brand-new EV for a fraction of the cost.
- Avoid the risk of depreciation
When one leases an electric car, the monthly rental paid covers the depreciation that occurs during the user’s time with the vehicle. Just like combustion engine vehicles, EVs are also at risk of depreciation and are expected to lose around 50% of their value after three years. However, when choosing to lease, that risk sits with the leaseholder, not the user.
- Rapid emergence of new vehicles and new technologies
New electric cars are hitting the market all the time and, quite frankly, it can be hard to keep up. Electric battery technology is developing at such a pace, there is a small risk that the cars available today could become quickly outdated in two or three years’ time. Leasing gives the flexibility to change vehicle every few years in line with these new releases, allowing drivers to experience the latest models and the best technology available.
Ultimately, a person’s chosen payment methods have to work for them and their individual circumstances. Leasing is not without its risks and there can be perks that come with buying outright, including having ownership terms, which can be important to some. The convenience and flexibility that comes with leasing, however, cannot be ignored. The flexibility of upgrading to the latest electric models every few years, coupled with lower monthly payments and minimal maintenance costs, ensures leasing can be a savvy financial move.
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