Back in the day when I thought we were going to be among the very first in the U.S. to get an electric car, I was determined to buy an EV outright, not lease one.
Now that I have had time to watch the EV revolution slowly unfold and wait on the sidelines in terms of getting an EV (we’re likely going to be in Germany for a full year, starting in August 2013, and have therefore elected to wait on getting an electric car), I’m revisiting my previous views.
If we were going to go with a plug-in hybrid such as a Chevy Volt (in my view, far and away the best PHEV due to its superior all-electric range), I might still elect to buy a plug-in.
However, if we were moving on a pure electric vehicle, I would definitely lease it, not buy it.
Here are five reasons to lease, rather than buy, a pure EV –>
1. Good to great deals on EV leases. You can lease a Nissan LEAF for as little as $199 per month with $1,999 down and leases for the Mitsubishi i-MiEV have been advertised for as little as $69 per month with $2,999 down. When you calculate potential fuel savings, you could end up saving a lot of money by leasing an EV as opposed to shelling out hundreds of dollars in gas money every month. If you own a home solar system, and also happen to be sitting on 8,000 extra “banked” solar kWh, as we are (I know, we’re in a highly unusual position), you could come close to driving a leased EV for “free”.
2. Ever increasing EV range. EV battery technology is outdated the day you drive your EV off the lot. For example, the 2013 Nissan LEAF has an estimated 15 percent more range than the 2011 and 2012 Nissan LEAF.
3. Questionable battery life. No one knows for sure how long pure EVs will typically retain their original range capacity. Sure, carmakers are offering warranties, typically eight years or 100,000 miles, which should offer some peace of mind. But, especially with the Nissan LEAF, whose owners have been reporting battery capacity experiences that have literally been all over the map, with some very happy, and others, especially those in hotter climates, very unhappy, why buy an EV outright when you can drive it for three years and just pass on any possible problems to the next person to buy/lease that EV . . . which brings me to the final, and biggest, reason I would lease rather than buy a pure EV: Questionable long-term resale value.
4/5. Questionable long-term resale value AND battery replacement issues. In the short-term, two to three years so far, pure EVs appear to be holding their resale value pretty well. However – and I’ve written about this before – what about the long-term, meaning the longer term when the battery pack is dead, or near dead? Who’s going to want to buy a LEAF with 90,000 miles on it, or one that’s seven years old – at least not for anything other than a completely cut rate price? Certainly not me. After all, you’ll be buying a car with substantially reduced range and charging capacity and one whose battery pack you’re going to have to replace or completely refurbish almost immediately – to the tune of thousands of dollars.
Meanwhile, if you lease a pure EV for the typical three-year term, you can pass on the problem – the very BIG problem – of battery replacement to the next guy. He or she won’t be able to drive for much more than five years without facing the unpleasantness of battery implosion – and the next owner won’t be able to sell that EV for much unless he or she invests in a new battery pack before selling it — but, hey, that’s not your problem, that’s another person’s problem (on the plus side, an EV battery will still have plenty of other uses after it reaches the point where it can no longer push a several ton automobile forward).
It’s likely the vast majority of people will be best served by leasing pure EVs, at least for the next 10 years or so, until the downsides to buying an EV outright, especially the thorny issue of battery replacement/refurbishing and their cost, go away and/or are clarified.
Given all of the above, which can basically be reduced to: a) technology passing you by; b) battery replacement issues, why would anyone buy a pure EV rather than leasing one for three years, moving on to the newer, better EV technology with increased range, and passing the battery replacement buck on to someone else? (Hello, Nissan, Mitsubishi and others: Hope you’ve actually given some thought to how hard it might be to move those LEAFs, i-MiEVs, etc. at a good price when they come back from their three-year leases!)
You might want to buy an EV, rather than lease one, if: a) you’re going to hold onto it “forever” (I’ve had my 1992 Acura Integra for 21 years); b) you’re not troubled by the prospect of a several thousand dollar battery replacement/refurb project about eight to 10 years in; c) you feel like leasing is throwing money away and/or you don’t want a car payment forever (having not paid a monthly car payment of any kind for 15 years, I can certainly relate to this desire); d) you’re planning on ad-wrapping the car; this was actually the main reason I was planning to buy a pure EV rather than lease one: I wanted to advertise to the world that we were running a pure EV on pure sunshine; in fact, turns out that, depending on the lease rules, you might be able to ad-wrap a leased EV.
In the end, it’s likely the vast majority of people will be best served by leasing pure EVs, at least for the next 10 years or so, until the downsides to buying an EV outright, especially the thorny issue of battery replacement/refurbishing and their cost, go away and/or are clarified.