Should you buy or lease an electric car?
ElectriX takes you through some of the differences
With plenty of gleaming brand-new models in the showrooms, you might wonder why you or your business should lease an electric vehicle (EV) instead of buying one and owning it outright. It’s a good question: there’s nothing quite like the warm glow that comes with ownership.
Or is there?
One good reason to lease, not buy, is the capital outlay. It’s sometimes said the difference between buying and leasing a car is the difference between buying and renting a house.But that’s not really true. Purchasing a house is usually (but not always) a sound investment: purchasing a car may not be. And electric cars usually cost more than their petrol or diesel counterparts. Their high-capacity batteries and the technology that translates all that power into motion doesn’t come cheap. Even a mid-range car such as the Hyundai Kona 64kWh will cost you in the region of £33k (Sept 2023), while average rates of depreciation are around 15-35% in the first year and considerably more after that. The instant you turn the key and drive a new car off the forecourt it loses a hefty chunk of its value. And that’s a lot of money to lose when you come to resell it.
There are two main types of car lease – Personal Contract Hire (PCH) and Business Contract Hire (BCH). The first is where an individual enters into a leasing agreement with a leasing company, such as CBVC – which works with ElectriX. The second is where a company enters into an agreement with a leasing company to provide its staff with cars. There’s also Personal Contract Purchase (PCP) that allows the individual to pay for a car over a fixed period of time, with the option of buying the car at the end of the leasing period.
ElectriX is also offering salary sacrifice: this is where an employee has the monthly leasing fee deducted from their wages at source, from their gross salary. Though the employee has to pay benefit-in-kind (BiK) tax (previously called company car tax), there are significant savings to be had this way, as the employee’s overall tax bill and National Insurance payments will be lower. ElectriX now offers the most flexible salary sacrifice scheme on the market, with different levels of risk protection tailored to the employer’s needs.
Leasing a family car like a MG4 Hatchback can cost as little as £256.65 per month on PCH (as at September 2023). Or take a high-end car such as the Tesla Model Y Long Range AWD – this can be leased from £510 per month (as at September 2023). And, after the contract period is up and no matter which model you’ve gone for, you hand it back with no cash payment at the end. You also have the option of getting another brand-new car of the same model, or an entirely different one, by which time technology will probably have moved on and the car may come with even more specs.
Lease an electric car
Choose an electric car lease with ElectriX and CBVC to:
- Choose your dream electric car – pick the car you want the way you want it
- Plan your costs – fixed monthly payments
- Go personal or business – lease in your own name or through your business