A beginner’s guide to leasing an electric car

A beginner’s guide to leasing an electric car –  the ultimate insider review

With the BBC and now the Telegraph producing guides and opinions on buying electric cars, check out the latest article the experts at e-Car Lease thought they might just put together a quick synopsis on the state of the nation to ensure that properly constructed, and technical, information is disseminated to the wider audience. At the beginning, it is important to recognise that as part of any leasing guide each customer is very different and will have unique needs/requirements as part of the process.

However, to keep matters simple we summarise our customers into one of three categorises –1) business contract hire 2) salary sacrifice 3) personal contact hire.

The main rationale for separating these customers is that the financial significance in each of the transactions is somewhat different. For example, a business lease is tax efficient for both the company (employer) and the driver (employee) with a particular focus on the company car tax at 2% BiK until 2025. For a salary sacrifice customer we have a situation of the employee not being “given” a car but they actually pay by way of deduction from their gross pay.

Again, due to the 2% BiK this makes it a tax-efficient process for both the driver and the company while offering a great retention and incentive scheme for all concerned. In the case of the personal lease, we are exploring the retail market as a whole; this is the customer who will sit there and say I want to buy, PCP or lease an EV but I need to overcome certain obstacles.

Too often we hear that customers think EVs are really just for the business and Sal Sac customers. This couldn’t be any further from the truth. Indeed, we have produced handy and easy-to-use guides on all fuel types which the e-Car Lease team send to all customers to make sure the different fuel options are properly understood. However, much of this can be set out quite succinctly to ensure a customer can make an informed decision. So what should a customer look at with an EV? What can they do to overcome any of the obvious obstacles?

Range – one of main objections to an EV is that they lack “range” for your driving behaviour.

We find that in most cases this is not true. Unless your mileage exceeds 20,000 miles per annum, many of the widely available vehicles are sufficient for your commute. However, when looking at range, we urge our customers to be careful. Electric cars are often highlighted to have a certain WLTP range based on 100% battery capacity.

The issue about using such an average is that it works on an almost best-case scenario rather than a true reflection. To help customers, we have an EV tool, as produced by our partners Lythium, which will set out the range of a car in cold weather and in warm weather while driving on smaller roads and motorways. Temperatures and driving speeds affect the range more significantly than you think, so when you are conducting a range analysis you must ask the seller/dealerships/broker a key question – what is the REAL RANGE of this car?

Cost – EVs are expensive to buy or lease?

There is an almost immediate reaction to say that the “normal” person in the UK cannot afford the EV options. In truth, the original EVs to launch into the UK were expensive and luxury-style options, with very few cost-effective options available other than a Renault Zoe or Nissan Leaf. The fundamental issue was that until Tesla produced the Model 3, mass-adoption was not there and we suspect manufacturers were concerned about introducing too many models to the market. The Model 3 was a seismic car in terms of cost, range and practicality to launch in the UK’s electric market (it has been a best-seller in some months).

This provided confidences amongst the UK public and the manufacturers to investigate further and we are now in situation where more affordable options (with realistic ranges and specification) are here – just look at the Skoda Enyaq, VW ID3 and ID4 plus the Hyundai Kona as illustration. The actual price of the vehicles are now within many peoples reach and this is without taking into account some other crucial information – EVs are cheaper to operate than a petrol or diesel car.

The running costs (or Whole of Life Costs) of an EV need reviewing. For example, servicing intervals are longer (and services are cheaper) and charging at home is much cheaper than fuelling at a petrol station. This is without taking into account tax savings for business and sal sac users! To be clear, the price you pay on the finance is not the only price you pay – what is best price, depends on more than that.

Charging Times – I don’t want to be sat waiting to charge all day.

The inconvenience aspect of an electric car is, in our opinion, the biggest issue for new customers. Moving towards something new and technological can be daunting and uncertain. There are fears of being sat waiting to charge all day and missing appointments or eating into free time. As a society, we are accustomed to everything here and now. One of the key things we highlight, via our Lythium EV knowledge tool, is the maximum charging rates in both AC and DC format.

Each manufacturer and model will have different charging capabilities shown in AC (Alternating Current) and DC (Direct Current), for example 11kw AC and 100kw DC could appear on your vehicle. To explain, the AC charging refers to those who charge at home or workplace on “slower” charging units. While some are available in the quicker 11kw or 22kW functions, many will be no more than 7.4kW. Rapid charging, or DC charging, are the units you see at service stations and Gridserve-style charging stations.

Available from 50-250kW, these units are designed to quickly get your EV from around 10-80% charge; they are not designed for 0-100% charging, as the charging rate on a rapid charging unit slows down considerably once 80% is reached. Each car will have a maximum charging capacity, which will then allow you to ascertain how quickly your car will take to charge. Again, as part of our Lythium EV tools, we show you the charging times for every type of charge point so this is made clear. Try to consider how your charging behaviour will develop – will you charge at home on a 7kW charger or are you likely to charge more frequently on your commute and leisure journeys?

Charging locations – for many who don’t understand the significance of the above, the volume of public charge points is something which concerns the potential EV driver. To help answer these queries we have partnered with Zap Map to help provide accurate charge point information to all customers. As you will see from the below, we are now beyond 25,000 charging devices in the UK. And, as you will see from their map (which is also available free of charge on our e-car lease website) there are normally more than enough charge points within your location.

Because new drivers are not familiar with how they look, there is an innocent ignorance when it comes to charge points. We also say that a customer should have a charge point installed at home, or at their workplace, to ensure a regular access to charging. With Energy companies, like Ovo and Octopus, now offering some great offers for overnight charging, this is the most logical route to utilise. However, we do accept that those customers who do not have off-road parking, may need to consider this in more depth.