Should I Buy Or Lease The New Chevy Volt EV?
Electric car drivers are a passionate lot and their numbers are rapidly rising. With EV sales in the United States showing steady year over year growth since 2010, all indications are that there will be more and more drivers asking themselves: Should I Buy or Lease The New Chevy Volt.
There are a number of considerations when making the decision whether to buy or lease a new electric vehicle, but here at Muzi we think it comes down to 3 factors: The rate of evolving electric technology, real cost of vehicle ownership, and personal preference.
EV Technology is Rapidly Evolving
Electric vehicle technology and infrastructure is rapidly developing. Every year, the range and technology of electric vehicles improves providing consumers with more viable options to choose from.
The second-generation Chevy Volt is certainly a testament to that notion. The Volt 2.0 has increased its electric range from 38 miles to 53 miles, nearly doubling the electric mileage of the competitive models from Ford and Toyota.
In addition, Tesla Model 3, Chevy Bolt EV and the second-generation Nissan Leaf are all going to be released over the next couple of years. The technology in these new electric vehicles promises to be a massive step forward.
For example, the new Chevy Bolt (due out in December of 2016) has proven to have a solely electric range of about 238 miles. A range like that basically eliminates the range anxiety that had previously plagued EV drivers and enthusiasts.
Leasing your new EV, provides you the flexibility to make shifts to newer, greener, more fuel-efficient options as they become available.
Lease Rates Are So Low On Electric Vehicles
Choosing an electric vehicle, in the first place, is an excellent economic decision. According to analysis by NerdWallet and others, a driver of an electric vehicle could save over $10,000 during the of driving an EV instead of its gas counterparts. Pretty impressive. Now let’s take a closer look at the breakdown between leasing and buying.
Excluding Tesla, lease penetration in the EV market is 75 percent in 2015, while leasing penetration across all other cars stands at about 28%. Why do so many drivers lease electric vehicles?
The reason is that the lease rates on these vehicles are incredibly aggressive. Manufacturers have federal quotas to meet and have incentivized their EV stock to ensure the EV is an affordable, attractive option for consumers.
For example, the 2017 Chevy Volt Lease is currently $0 Money Down and Just $169/mo. It’s hard to pass up a deal like that to drive a vehicle with an MSRP around $35,000 to $40,000. By contrast, a Volt purchase financed for 60 months would place your monthly payment up over $600, before taxes.
So the potential monthly savings over a 39 month period of time is $12,000+ dollars.
Available Tax Incentives On Electric Vehicles
Many electric vehicle purchases qualify for both a state tax rebate and a federal tax credit of up to $7,500. The most important words in the last sentence are definitely “up to”. That is because if you do not owe the federal government $7,500 you will not get to use the full credit.
For example, if you only owe the government $3,000 at the end of the year that is all that will be applied, the other $4,500 will not be used. Moreover, if you lease your EV you do not qualify for the federal credit at all.
So, while you don’t get the $7,500 tax credit when leasing you will still receive the full $2,500 state rebate in states like Massachusetts which incentivize EV purchases.
You can get additional details on the tax credits here, but it is best to consult with your accountant.
Taking advantage of the current lease rates on electric vehicle, while they remain heavily incentivized, is definitely worth consideration.
Personal Preference Whether To Lease Or Buy
Many drivers think that buying is a better option because they will have equity at the end of their term, but we tend to be a bit leery of that proposition.
Being in the car business, we see most drivers selling/trading in their vehicle before their 60 or 72 month term is completed, negating some of the value of purchasing. Let’s face it after 4 or 5 years many drivers are ready for something different.
In addition, in the EV world, the rapid evolution of EV technology leads to lower resale value of older model electric vehicles that are 3-5 years behind the tech curve.
Leasing also affords you the opportunity to drive a vehicle with many maintenance costs covered because it remains under warranty. A lot of the expenses of ownership come after the 4 or 5 year mark when the bumper to bumper warranty has expired. In a leased vehicle you retain the peace of mind that comes with warranty protection.
So, when considering: Should I Buy Or Lease The New Chevy Volt – there are many factors to take into account. It is our opinion that consumers should take a strong look at leasing because it affords the benefits of flexibility and month to month affordability.
If you have any questions at all about this article, the Chevy Volt or anything automotive related please do not hesitate to reach out to anyone of our team members.
Muzi Chevy
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Route 95 to Exit 19B
Needham, MA
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