Electric car Leasing vs Subscription: what’s the difference?
UK drivers have more choice than ever before when it comes to driving a new electric car. Traditionally, drivers simply bought new or second hand. Sadly, the upfront costs to buy a new electric car are still reasonably high, preventing many eager drivers from taking one home. Now however, there are several solutions available for drivers. Making the switch to electric much more accessible. Two popular options include electric car leasing and electric car subscription models.
But what are the differences, and which one is best for you?
Read on to find out.
What is an electric car lease?
Leasing an electric car provides an affordable way to drive a brand-new electric car, without the high upfront costs of buying one outright. It is like renting. You drive one electric car for the lease period, and you spread the costs over a longer set period, for a set fee. A typical EV lease consists of a two to five-year deal, with a contracted mileage agreement. Some companies offer insurance and maintenance as added extras. There are a few different types of EV car leasing options to consider.
Why lease an electric car?
Leasing an electric car is a great alternative to purchasing. It allows many drivers to drive their dream car at a more affordable price – since you pay monthly over an extended period of time. With many leasing deals, you also don’t need to worry about the risk of depreciation or selling the car since you don’t own it.
What is an electric car subscription?
One of the newest and most flexible models out there, electric car subscriptions have picked up attention in the last few years. Consumers are becoming well acquainted to ‘subscribing’, with the likes of Netflix, Spotify, and Hello Fresh, but what does this mean for electric cars?
Electric car subscriptions bundle up all your driving needs into one monthly package as part of your subscription fee. Car rental, insurance, maintenance, tax, and breakdown cover are all included as standard. Plus, the electric car will be delivered to your doorstep.
Subscription models are very flexible, with most subscription companies offering 1 – 3 months fixed contracts, where you can continue a rolling contract, or swap or stop any time after this period. This is particularly useful for electric cars, so drivers get to try out different models to see which one works best for their lifestyle.
On elmo, you can choose between two options:
- If you want ultimate flexibility, then elmoFlex is for you. With just a 60-day minimum term, you can swap to another electric car or stop with just 30 days’ notice. Perfect for drivers who don’t need a car 365 days a year.
- elmoSave allows you to commit to a 12-month minimum and enjoy our best pricing. Great for drivers who need a car full-time and want the convenience of an all-inclusive package.
For more information about our two packages, head over to our elmoFlex vs elmoSave page.
In most cases, subscription models do not require an upfront deposit. This helps to remove one of the greatest barriers to EV adoption – cost.
Video: what is an electric car subscription?
We’ve condensed this question into a 40 second video, give it a watch below to find out exactly what an EV subscription is with elmo.
Why subscribe to an electric car?
Electric car subscriptions are a great alternative to purchasing, they are easy to set up and one payment covers everything you need to get on the road.
- Flexible. There are no long-term contracts which means you can swap or stop at any time, plus you can try out a variety of EVs.
- Fixed payments. Everything’s included in one monthly payment, so you don’t have to worry about anything. It also allows you to budget as you know exactly how much you’ll be paying for the car each month.
- Reduced costs. With no deposit, and monthly costs competitive with standard leasing deals, the costs of driving an electric car are affordable.
- Variety. Most EV subscription companies offer a wide variety of makes and models to try. Technically, you could drive a brand-new electric car every other month if you wanted to.
Electric car leasing vs subscription
When it comes to choosing between an electric car lease and a subscription, it’s important to understand some of the key differences.
What’s the price difference?
A common misconception is that you’ll pay a premium for greater flexibility. This often isn’t the case with electric car subscriptions. Certainly, here at elmo we don’t think that drivers wanting to make greener decisions should have to pay more. Subscriptions are often very competitively priced when compared to leasing deals.
At elmo we want to be transparent about the price differences. So for every model available on our website, we provide a lease vs subscribe table so drivers can make a call on which would suit them best.
Here’s an example:
Peugeot e-2008 GT Premium
- Upfront payment
- Minimum commitment
- Total monthly cost
- Vehicle monthly payment
- Upfront payment**
- Breakdown cover
- Vehicle Excise Duty
- 36 months
- 60 days
* Compared against leading lease deals at 10,000 miles a year.
** Split monthly over 36 months.
*** Lease vs elmo comparison guideline only. May vary depending on model.
Electric car leasing vs subscription: what is best?
Well, that really depends on what you are looking for. If you know exactly which electric car you want to drive and are happy to keep that car or wish to own it eventually, then a lease might be the right choice for you. On the other hand, if flexibility is your bag and you are still unsure which EV might be right for you, then a subscription model may suit you better. The choice is yours!
Can you lease an electric car?
Yes! There are many companies out there offering leasing deals on electric cars. We recommend doing some research to find the best deal out there for you.
When is it more beneficial to subscribe to a car than lease?
Subscription models offer better flexibility, because you aren’t tied into a lengthy contract (1-3 months on subscription compared to typically 2-5 years on leasing). That means you can switch to different electric cars whenever you like or stop altogether if your circumstances change.
Is an electric car subscription the same as renting?
It is similar to renting, however with electric car subscriptions you also get insurance, maintenance, breakdown cover, vehicle excise duty and congestion charges included in your monthly payment.
How much does it cost to lease an electric car?
That depends on the type of lease you choose, plus the electric car model. The Renault ZOE for example could cost you around £450 per month on a lease with a £1,000 deposit, compared to a Tesla Model 3, which comes in at around £1,200 per month, with a £3,000 deposit. These figures vary greatly depending on the length of your contract, annual mileage and whether you’ve opted to purchase the car after your lease.
Do you pay a deposit for car subscriptions?
No not usually, that’s one of the key differences between leasing and subscribing to an electric car.
What is the minimum contract for a car subscription?
1 -2 months is typically the minimum term for car subscriptions; however, some companies offer a 3-6 months minimum term.