Electric car: lease or buy?
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If you're considering driving an electric car, you may be wondering whether you should lease or buy the vehicle. Buying a car may make sense for drivers who will take their vehicle on extended trips every year, while leasing a car saves you the risk of permanently losing battery capacity.
You're considering a plug-in electric car.
Should you lease or buy?
It's a question that all new-car shoppers face--but for electric cars, there are some special considerations.
Each financing option has its pros and cons, so we've outlined the reasons you might opt for each alternative.
- The Federal income-tax credit of $2,500 to $7,500 is wrapped into the monthly payment, so you avoid paperwork and up to 15 months of waiting to realize the cash
- You're protected against permanent loss of battery capacity; at the end of the lease, you just turn the car in--and any pack loss isn't your problem
- You're protected against potentially low resale value for used electric cars (the math is complicated due to the various financial incentives)
- Leasing deals for still-pricey plug-in cars give you a lower monthly payment (in part because you're not building equity)
- In California, you still get the state's $1,500 to $2,500 purchase rebate in the mail even if you lease
- You own the car, and you have an asset once you're finished paying for it
- If you take care of your battery and live in a temperate climate, capacity loss may not be an issue for many years
- Drivers who cover many miles each year likely won't find leases to accommodate that
- Pure battery-electric cars are so simple that they need almost no mechanical maintenance, saving you money over more complicated gasoline cars every single year
- Plug-in car makers are starting to offer battery-replacement programs, meaning you could keep the same car for a very long time
Leasing is the more conservative route for you if you're at all worried about battery life.
That's lately been reinforced by articles such as one in the Wall Street Journal, which warns in apocalyptic tones, Don't Get Stuck In An Old Electric Car.
93 percent leased
Indeed, it appears that by far the largest proportion of plug-in electric cars delivered have been leased.
The WSJ notes that data-research firm Experian Automotive reports fully 93 percent of electric cars delivered from October through December last year were leased.