Like most other industries, the automotive industry is significantly shifting due to rapid technological advancements. The negative impact of combustion engines on the environment is another factor driving the demand for eco-friendly and greener cars.
Electric vehicles (EVs) are becoming more popular worldwide as they offer better mileage, sleek designs, and ultra-modern features. With constant volatility in the oil market and rising fossil fuel prices, drivers want to save every penny they can on the vehicles they drive daily. According to statistics, 1.6 million EVs were sold in the US in 2023, which is almost a 60% increase from 2022.
Today, leasing an EV is ideal for car buyers and cheaper than buying or leasing a gasoline-powered vehicle. The fact was made based on a comprehensive report by Energy Innovation comparing 14 gasoline cars with EVs. The factors analyzed in detail included fuel costs, insurance rates, state and federal fees, credits, taxes, and financing costs.
What is Electric Vehicle Leasing?
As the EVs grow in popularity, more automakers are jumping on the electric car bandwagon. Similarly, dealerships across the country are now offering a broad range of EV cars to customers.
Leasing a car is similar to hiring or renting a car. You make an initial down payment and then pay monthly installments. However, at the end of the lease, which can be 2 or 3 years, you hand over the car as your leasing contract ends. Also, the monthly payments are often less than a person normally pays to finance the car for 18 or 36 months.
The EV Lease Tax Credit
The EV industry got a significant boost with the introduction of the Inflation Reduction Act (IRA) in 2022. The highlight was the $7,500 tax credit on purchasing a new electric vehicle. However, the cars must be built in the US and use local parts and batteries. Also, the EV must be priced within certain limits, and your income as a buyer must not exceed a particular amount.
The EV lease does bring a $7,500 benefit, but it goes to the leasing company, not the lessee. The chances of you getting any savings in the form of a rebate or low lease price depends on the individual leasing company or dealer.
In the market, you will come across various names such as ‘lease cash,’ ‘lease credit,’ ‘electric vehicle savings,’ and even ‘EV lease bonus.’ The names and terms of the lease differ from one leasing dealer to another. Some of the leasing dealers do offer exclusive discounts to potential EV buyers.
How to Get a Bonus on an EV Lease
Leasing an EV is similar to leasing a gasoline car. You have to fulfill certain criteria and requirements, which include:
- A good credit score (more than 600)
- A valid driver’s license
- Stable monthly income
- Insurance proof.
If you meet these guidelines, you can buy or lease an electric car.
But can you get the EV tax credit the federal government offers?
According to IRA policies, only select EVs and buyers who meet requirements qualify for the IRA tax credit. However, those restrictions do not apply to leased vehicles. When you lease an EV, conditions like where the car is made, your monthly income, or how much the EV costs do not apply.
The IRA classifies leased EVs as commercial cars, making them eligible for an EV tax credit that offers more benefits than a regular consumer tax credit. The leasing company or dealer can get the full $7,500 EV lease bonus and give all or part of the benefit through lower monthly payments.
You have to look around for dealers that offer discounts on leased EVs. Furthermore, many notable car manufacturers advertise lease deals on their websites and online ads. These deals reduce the cost of the EV as well as the down payment and monthly payment.
Can You Negotiate the Price of an EV Lease Deal?
Leasing companies and dealers are not bound to offer complete benefits as advertised in lease deals. However, as a potential buyer, you can debate and negotiate the EV lease deal. Also, due to competition, most dealers offer numerous discounts on deals to convince potential car buyers.
The leasing company or dealer can include the EV tax credit in the lease. Most buyers may not be aware of the EV lease bonus the vehicle is eligible for and instead focus on a down payment and monthly installments.
Therefore, it is important to ask the dealer if the tax credit is included or not. You must also check the original sales price and notice if it’s marked up to cover the lease bonus.
Should You Buy or Lease an EV?
Almost all leasing contracts have a payoff or buyout amount. One can pay this amount to buy the car from a leasing company or dealer. You can negotiate an amount, but only before signing the lease agreement.
If the demand for EVs at the end of your lease is high, then the resale value will be high. It will then be profitable to purchase the car at the buyout price signed in the contract. You can even get a better profit if the dealer or leasing company underestimates the resale value of the EV.
Leasing an EV offers several advantages, such as less restriction on tax credits and lower monthly payments. The other advantages include:
Ease of Owning and Driving Modern EV
Due to leasing, you can easily swap your current vehicle with the latest one every few years. Moreover, rapid EV tech advancements mean you get better battery output and mileage, and the prices of new vehicles will fall quickly. With leasing, you can get better performance improvements at an affordable price.
Low Maintenance Cost Over Time
Oil prices keep fluctuating, increasing the overall cost of running and maintaining a gasoline vehicle. Conversely, it is a lot cheaper to drive and maintain an EV. In addition, by leasing, the warranty will cover any minor or major repair costs. It means you will not have to pay much.
More Superchargers to Charge an EV
There is an ongoing debate among Tesla and other car manufacturers. Tesla has an extensive network of charging stations across the country, but those are only specific to Tesla vehicles.
However, companies such as Ford, Mercedes, GM, Chevrolet, and others say car owners can use 12,000 Telsa superchargers. Also, most of their EVs will come with a standard charger similar to that of Tesla.
Tips for Getting the Best EV Lease Deal
If you are looking to lease an EV, you need to follow certain tips that are:
Consider Your Needs
Always look for a car that can best fulfill your needs. Today, EVs come in nearly every segment, from sedans and crossovers to big trucks. But do not be awe-inspired by the exterior or interior looks. Usually, the most glamorous EVs are not the most practical ones.
Search and Shop Around
Look for dealerships around you and also search online. Search various leasing companies and dealers and then compare what each is offering. This will help you pinpoint the best lease deal on offer.
Understand the Lease Contract
Understanding the lease contract is one of the most crucial steps after settling to buy an EV from a dealer. You need to ask if the EV tax credit is factored into the paperwork and if other conditions like mileage and wear and tear are covered in the warranty.
Negotiate
There is never a fixed price, and deals are never set in stone. Negotiate the terms and conditions of the lease deal.
Get a Lease Swap Deal from QuitALease
Suppose you want to avoid the hassles of meeting potential dealers and are unsure what price to negotiate. In that case, you can even consider taking over an existing lease.
QuitALease is the best marketplace for matching people who want to exit a lease with people who want to take one. The website offers extensive listings of available EV cars, and experts can guide you through the takeover lease process.
First, register on the website and quickly search for the best EV cars available on takeover lease. QuitALease makes it easy to search by car manufacturer and model. You can even enter your zip code to look for potential deals closer to you. Apart from this, you can refine your search by transmission, exterior and interior color, assembly, total mileage, and body styles.
The advantages you get from a takeover lease are
● Short-term Lease
Usually, a lease contract lasts for two to three years. However, a takeover lease means you can drive an EV for a shorter period without signing a long-term contract.
● Low Monthly Payments
The existing lessee can have a very good credit score and has made a big down payment. In that case, after taking over the lease, you will have to make low monthly payments.
● Cash Savings
Many drivers offering the takeover deal look to hand over the vehicle immediately. They also offer to cover any transfer fees charged by the leasing company, which saves you hundreds of dollars.
The Steps of Take Over Lease Process
Once you have found a potential lease takeover, the next step is to finalize the deal and acquire the car. You can even take some time to go over specific terms before beginning the takeover lease. The process involves paperwork between you, the lessee, and the leasing company.
The steps are:
- You will drop a credit application with the leasing company for the takeover.
- Your credit score will be analyzed, and the leasing company will ensure you can make the required monthly payments.
- Once approved, the takeover lease documents will be prepared and sent to you and the existing lessee.
- After both parties sign the papers, they are returned to the leasing company, and you get the car keys.
- The leasing company will send confirmation letters to the seller and buyer of the lease after processing the documents. You will then start to pay the remaining monthly payments of the lease.
Conclusion
The smart EV policy and IRA incentive have boosted the trend of leasing an electric vehicle rather than buying or financing a gasoline vehicle. EVs already offer numerous advantages over their gasoline counterparts. Furthermore, dealers and leasing companies pass the EV tax credit to potential car buyers through customized deals and discounts.
Leasing an EV is the cheapest option for car drivers to own and drive a new car. You can further increase your savings by opting for a takeover Leasing an EV is the cheapest option for car drivers to own and drive a new car. You can further increase your savings by opting for a takeover lease. With its extensive database and diverse listings, QuitALease will help you get a potential takeover within minutes.