Thinking of going electric?
Well, you’re in luck!
There’s a new way of owning an electric car and it’s called a subscription. It’s very different from traditional forms of car ownership, which makes the sector more affordable for everyone.
An EV subscription service doesn’t include a long-term contract. The minimum term length is often 1-3 months and many providers offer you the ability to stop & start your contract at will. This makes it the perfect option if you only need a car for a few months.
Younger or newer drivers may not be accepted by EV subscription providers. Many require you to be over 25 and have held a full UK/EU driving license for at least a year, if not longer.
Some also require proof of a no-claims bonus, no driving convictions, or penalty points on your license in a set time frame. This can make it difficult for some drivers but don’t worry – we’ve got you covered!
In this article, we go over both the pros and cons of electric car subscriptions to help you make an informed decision.
How Does an Electric Car Subscription Work?
First, let’s go over how an electric car subscription works.
There are a few key things to remember:
You don’t own the car outright – you’re effectively renting it from the provider.
The minimum term length is often 1-3 months, with some providers offering the ability to stop & start your contract at will.
You’ll have to pay a monthly fee, which covers the cost of things like insurance, maintenance, and breakdown cover.
You’ll also have to pay for your own electricity, which is usually done through a home charging point or public charge point.
Now that we’ve got that out of the way, let’s take a look at the pros and cons of electric car subscriptions.
The Pros of an Electric Car Subscription
- The upfront cost is low (no deposit).
- Flexible monthly payments.
- All-inclusive – insurance, maintenance, and breakdown cover are often included.
- Can try it before you buy it.
- Can try out different brands of cars.
- You won’t lose out on depreciation.
- Shorter term than leasing.
1. The upfront cost is low (no deposit)
If you have used a leasing service, you’ll know that they like to play around with the size of the deposit.
The smaller the deposit, the larger the monthly payments, and the larger the deposit, the smaller the monthly payments.
With electric car subscriptions, there is no deposit required which makes it more affordable for people who don’t have a large sum of money to put down upfront.
I’ve put this “pro” at the top of the list because saving the deposit for so many is one of the hardest obstacles to overcome when it comes to car ownership.
2. Flexible monthly payments
Another great thing about electric car subscriptions is that the monthly payments are often very flexible.
This is because there is no long-term contract and you’re not locked in for a set period of time.
If you need to reduce your monthly payments, you can do so by opting for a shorter-term length or a lower-priced car.
If you want to increase your monthly payments, you can do so by opting for a longer-term length or a higher-priced car.
This flexibility is great for people who are on a tight budget as it allows them to adjust their payments to suit their needs.
3. All-inclusive – insurance, maintenance, and breakdown cover often included
If there was ever anything that could sweeten the deal, it’s this!
When you sign up for an electric car subscription, the monthly fee often includes things like insurance, maintenance, and breakdown cover.
This is great news for people who want to save money on their car ownership costs as it means they don’t have to pay for these things separately.
It’s also great news for people who want the peace of mind that comes with knowing their car is covered in case of an accident or breakdown.
4. Can try it before you buy
Now, this is a fairly new concept and one that very few people have thought about.
Since electric cars are still quite a new phenomenon with many of us still undecided about whether or not they’re for us, electric car subscriptions offer a great way to try them out before committing to buying one.
This is perfect for people who want to test the waters before taking the plunge and it’s also perfect for people who are undecided about which brand or model of the electric car they want to buy.
5. Can try out different brands of cars
What’s even sweeter, is the fact that you can continually swap out the models you’re subscribed to until you find the perfect one for you.
This is perfect for people who want to test drive a few different models before making a decision or for people who simply want to try something new.
6. You won’t lose out on depreciation
If you’re planning on buying an electric car outright, then you need to be prepared to lose a lot of money when it comes time to sell it.
This is because electric cars depreciate quite quickly and so their resale value is often quite low.
As soon as you drive your new car off the lot, you pretty much lose the VAT and then some.
With electric car subscriptions, you don’t have to worry about this as you’re not the owner of the car and so you won’t be taking the hit when it comes to depreciation.
7. Shorter term than leasing
Electric car subscription terms are often shorter than leasing terms and so this is something to consider if you’re looking for a short-term solution.
Leasing terms can be as long as 4 years, whereas electric car subscription terms are often just 1-3 months at a time.
This is great for people who want the flexibility to change their car more often or for people who only need a car for a short period of time.
The Cons of an Electric Car Subscription
- The monthly payment is higher.
- You’re not guaranteed to get a brand new car.
- The options are a lot less.
- Works out more expensive in the long run.
- Hard to get if you have bad credit.
8. The monthly payment is higher.
If you compare the monthly payments of a car lease and an electric car subscription, you’ll find that the latter is often quite a bit higher.
This is because electric cars are still quite new and so the monthly fees haven’t come down as much as they have for other types of cars.
Since the subscription service can’t guarantee to rent these cars every month, they calculate an added premium to cover their losses.
9. You’re not guaranteed to get a brand new car.
Another downside of electric car subscriptions is that you’re not guaranteed to get a brand new car.
When you sign up for a lease car, other than the tests they did at the factory and the person who drove the car to you, the car is practically brand new.
With an electric car subscription, however, you’re not always going to get a brand new car.
You might get a car that’s only a few months old or you might get one that’s a few years old.
10. The options are a lot less
Since the car subscription service is still a relatively new concept, there aren’t as many options available as there are with other types of car leases.
This means that you might have to compromise on the type of car you want or the features you’re looking for.
11. Works out more expensive in the long run
While electric car subscriptions might seem like a great deal at first, they often work out more expensive in the long run.
This is because you’re not paying for the car itself, you’re paying for the use of the car and so the monthly fees can add up over time.
In fact, the longer you have the car, the more you will pay when compared to other types of car leases.
12. Hard to get if you have bad credit
If you have bad credit, then it’s going to be hard to get an electric car subscription as most companies will require a good credit score in order to qualify.
This is because the subscription service is a new concept and so most companies are still trying to protect themselves from losses.
So, if you have bad credit, you might want to consider another type of car lease or financing option.
Alternatively, you can try to fix your bad credit score so that you can qualify for an electric car subscription.
You can do this by paying your bills on time, maintaining a good credit history, getting a secured deposit credit card, and using a credit repair service.
Is it Worth Getting an Electric Car Subscription Service?
Electric car subscriptions have their pros and cons, but ultimately it depends on your individual needs and circumstances as to whether or not they’re worth it.
If you need a car for a short period of time or if you want the flexibility to change cars more often, then an electric car subscription could be a great option.
However, if you’re looking for a more affordable option in the long run or if you have bad credit, then you might want to consider other options.
Talk to your local electric car dealer to see what they recommend and compare different offers before making a decision.
- A ton of flexibility.
- Lack of model choice.
- Pay more in the long run.
- Great if you want to try it before you buy.
- Hard to get if you have bad credit.
- The monthly payment covers maintenance, insurance, and breakdown cover.
Is a car subscription a good idea?
It is determined by your demands and circumstances. If you need a vehicle for a specific period of time or want the freedom to switch cars on a regular basis, an electric car subscription might be ideal. However, if you are seeking a more affordable long-term option or have bad credit, consider different choices.
Are hybrid cars cheaper to insure than petrol cars?
No, hybrid cars are not necessarily cheaper to insure than petrol cars. This is because insurance premiums are based on a number of factors, including the make and model of the car, the driver’s age and driving history, and where the car will be driven.
Can I get an electric car with bad credit?
It’s possible to get an electric car with bad credit, but it will be difficult. This is because most electric car dealerships will require a good credit score in order to qualify for an electric car lease.
Are charging stations free to use?
No, charging stations are not free to use. However, there are some charging stations that offer discounted or free rates for electric car owners. You can find these by doing a search online or by asking your local electric car dealership.
How do car subscription companies make money?
Car subscription companies make money by charging customers a monthly fee for the use of their car. This fee covers the cost of the car, maintenance, insurance, and breakdown cover. The company then makes a profit by charging more than it costs to provide these services.
Can I take a subscription car abroad?
Yes, you can take a subscription car abroad. However, you will need to pay for an international driving permit and insurance. You should also check with the car subscription company to see if there are any restrictions on taking the car outside of the country.
Will I get a home charger with my electric car subscription?
Some electric car subscription companies will provide a home charger with your car, but this is not always the case. You may need to purchase a home charger separately or find a public charging station to use.