There was something about getting lost in the haziness of a drive. You, a passenger, someone else behind the wheel. The wind whirring, as the car zips past, tangled in cascading branches. Past the chaotic traffic jams, and the screeches of angry drivers. Into the countryside where rolling woods reside; sloping green hills chomping down on wilting blooms. Poetically beautiful quaint cottages, slithering with ivy. More trees than buildings, hauntingly stunning at night. A flash of light from a walker, burrowing through murky rain. Splish-splash, engulfed in puddles. Tyres eating up water, like it was parched. For a road trip in England wouldn’t be complete without a secret weapon. In their future vision, they would lease an electric car. A glorious vehicle shrouded in mystery and glamour. More affordable than buying, with no long-term commitement.
Gazing at traffic lights with colours of an expired sunset, they’d ponder. Where would they go today? A staycation that they’ve always wanted, three precious kitties in tow. A boot stuffed to the brim with as much clothing as A could bring. A ‘proper road trip’ to countries near and far, beyond the tourism given. Off the beaten track, the real thing. Tropical, sunny, wet, rain and snow. All the seasons, lovingly embraced. To lease an electric car, was to unleash a magnitude of adventures beyond their wildest dreams.
What Is An Electric Car?
But what was an electric car? A vehicle powered only by electricty that would rekindle your love for driving. Charged by an external power point, like a chargepoint. Not just a pretty face, a real-world range of 220 miles on full charge. No tailpipe emissions, not a peep, reducing your carbon footprint. Three types of electric vehicles, 1,2,3. BEV, PHEV, E-REV. The first, battery-powered, a pure electric car. The second with a battery, electric drive motor and internal combustion engine. A pure electric range of up to 50 miles. The third but not least, combining a battery, electric drive motor and a small petrol or diesel generator.
How Does Leasing An Electric Car Work?
It was just like renting or hiring a car. They would make an initial payment, make monthly payments and then hand their car back at the end of the contract. A popular way to try out electric cars, less outright cost than buying. They would hunt for the greatest electric car lease deals, searching far and wide. With predictable monthly costs, they would be able to choose the car they wanted when they wanted.
Why Should You Lease An Electric Car
Leasing Is More Affordable Than Buying An EV Outright
At £50,000+, the average price of an Electric Car was far too much. Yet, with leasing being between 200-330 per month, their dream could stay alive a little longer. With a lower monthly payment and a longer warranty than with a purchase, it seemed too good to be true. Sure, long-term the costs would mount up. But being able to lease an electric car was more affordable for a short period. Even if they ended up leasing a higher-end EV, the fuel costs would be halved up to 50%. Eventually this would offset the higher payments.
They could picture the scene. Diesel cars banned, blue sky thinking. Clean cars, clean energy, battery powered. Cars that were good for their soul. A spontaneous wander, traipsing bendy countryside cobbled lanes. The hum of other cars on the road, trying to take over. Electric Vehicles, the future stars of roads. Some said driving the future came at a cost. But when that cost meant better living, was it all worth it? Yes.
No Long-Term Commitment For Curious Users
Buying was a long-term relationship, a marriage. A locked in til’ death do you part. To lease an electric car had no such expectations. No long-term commitement, a chance to experiement. An opportunity to discover where your tastes lay. Sleek grays and velvety black hues. Glossy reds and midnight blues. Burnt orange the colour of autumn, seasonal apple greens. All the colours of the rainbow, in a better, more powerful car. Mazda’s, FIAT’s and Nissan’s too. All the cars you could wish for in the palm of your hand.
After all, as drivers they would never own the car when it was leased. Hence not being commited to the vehicle long-term. With the average lease car-term being 2-3 years, and a ‘normal car lifespan’ ranging between 7-10 years, there was a stark difference. With the maximum lease being 3-4 years, they could explore other car options once their lease ended. Speaking theoretically of course, given they were exploring EV’s.
Tax Incentives For Business Customers
To be rewarded for leasing an electric car seemed like Christmas come early. With the UK government keen to achieve its Co2 emissions targets, it encouraged people to make the switch. With tantalizing tax savings, and incentives to encourage business uptake, it seemed like a no-brainer. But what were the incentives? From April 2020, fully electric cars became zero BiK for 2020/2021, 1% for 2021/22 and 2% for 2022/23.
As if that wasn’t enough there was the salary sacrifice scheme. It allowed employees to pay for the lease of an EV through their pre-tax income. So what did this mean? Employees would save 12% on their NI contributions, with a further 20% or 40% depending on marginal income tax rate. There would be no additional costs for the employers ( excluding admin), and there would even be savings made on the employers NI contributions too. It was an opportunity that was just too good to pass up on.
Flexibility For Drivers Who Swap Cars Regularly
Autonomy was important to them both. Having flexibility to do what they wanted, when they wanted was the dream lifestyle. But for now, they were hustlers dreaming of another life. When they would lease an electric car, it would give them that freedom that they craved. Flexibility for drivers who swap cars regularly, disrupters in the market. They wouldn’t own the car, granted. But maybe they didn’t want to. Maybe they wanted a car that was cleaner, greener, and more affordable. A car that allowed them to see what else was out there, when the market was overly saturated. To lease an electric car, was to create a better future.
After all, the future of mobility was flexible, electric and autonomous. A shift towards more flexible car leasing meant it would reduce adoption barriers and help increase the decarbonization of passenger car mobility in the world. More to the point, they could switch to a new car at the end of the lease without hassle. With some plans allowing you to swap regulary within your subscription, the lack of cons was telling.
Leasing A Car Avoids Depreceation
Perhaps one of the greatest selling points of an Ev, was avoiding depreceation. But how did that work? Surely it would increase in value over time? Unfortunately not. Unlike buying a home, which would increase in value, a car’s value would deplete. Why? Because as the car ages, and the miles get clocked up, its value would plummet. However, to lease an electric car through salary sacrifice would be a positive. The cost of the depreciation would be factored into monthly payments. So no risk of the car reducing in value over time.
So what did this mean? Instead of paying the full depreciation cost of the vehicle, you only paid for the use of the car for that period. Depreceation factored in residual value, monthly depreceation, monthly rent charge and monthly tax. So, if you brought a car you would need to carefully pick and choose from models which are known for strong continued value. With a leased electric vehicle, it did not matter. And so their exploratory journey had come to an end. Exploring the benefits of an electric car lease, and why it was relevant to them. Depreceation decrease, and flexibility alike. Tax incentives and flexibility. It was clear why EV was the future of the car world.
Why Would You Lease An Electric Car?
Please note this is a collaborative post but all thoughts are my own and are not affected by monetary compensation.