Car Leasing vs Subscription: What’s the Best Choice for You
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Owning a car is not for everyone, some people like the convenience of driving one without dealing with the ownership responsibilities.
This is why options like car leasing and subscriptions have become popular. Finding the best choice for yourself can be difficult, fortunately, we are here to help.
Getting a car can make a big difference in your life, you are no longer dependent on family members and friends for lifts, and can give up public transport altogether. A whole new world opens up and access to new people and experiences becomes available.
We have often associated this freedom with the direct ownership of a car but that could be further from the truth. Options exist that give you the same benefits as owning a car but with fewer risks, these are car leasing and car subscriptions.
Let’s have a look at what they are and how they work.
Car Leasing Explained
Car leasing is very similar to living in a rental property, meaning a person can enjoy all the benefits of ownership without actually owning the asset. This is usually a long-term agreement where the driver gets to use the chosen car for the contracted period.
Terms of use This agreement will specify the terms of use, stating who is allowed to drive the car, how the car should be treated, where it is allowed to go, where it is to receive repairs, and many other clauses.
Mileage Depending on the type of lease other terms can be included, for long-term contracts mileage limits can be imposed. This will give the driver a cap on distance travelled with penalties for going over the maximum distance.
Consideration This option can offer the opportunity to purchase the car after a specified time. These are known as lease-to-own agreements, where the contract acts as a rental agreement for the period and then switches to an ownership deal once a specified number of payments have been made.
A car subscription works similarly to a streaming service, in that you pay a monthly fee and get access to a catalogue of available cars. This service often does not require long-term financial commitment and can be paid on a month-by-month basis.
Terms of use With this service, a driver can book a specific car based on their needs at that point in time. Someone could get a sedan for daily use and exchange it for an SUV when on a road trip, or a bakkie when moving house.
A highlight of this type of car rental is not just the short-term commitment, but the bundled costs. Expenses such as insurance, warranty, and roadside assistance are all included in the monthly fee. You can expect that no surprise charges will be billed to you.
Key Differences Between Car Leasing and Subscription
Car leasing and subscriptions may sound similar, and in some cases function the same but they are fundamentally different. Here is a look at how they compare when put against each other.
Car Leasing vs Subscription
Feature
Car Leasing
Car Subscription
Contract Length
Typically 2-5 years
Short-term, monthly or otherwise specified.
Costs Covered
Monthly payments and insurance premiums are paid separately.
Fees usually include insurance, maintenance, and roadside assistance.
Flexibility
Limited, usually the same vehicle throughout the leasing term.
Vehicle swaps allowed.
Ownership Option
Lease to ownership contracts available.
None
Mileage Limits
Yes
Flexible, dependent on contract.
Maintenance Responsibilities
Yes, including repairs.
None, usually included in the monthly fee.
Which Option Is The Best For You?
Now that you know how the two are different, it’s time to decide which one to take on. If you are still undecided there are a few other factors to consider that will assist in making a decision, here are some to consider.
For the Committed & Cost-Conscious Driver
If you are a driver who prefers stability and wants a newer car without the high costs of ownership, then leasing is a great option for you. These are the different types of people who this sort of plan would suit.
Budget-conscious individuals Not every driver has the same budget when it comes to vehicle financing. If you have enough money to afford the monthly payments for a car leasing agreement but not enough for a vehicle loan, then this is for you.
Drivers with predictable mileage If you stick to a routine and have a predictable commute, these options might also work for you. This means that you will stick to the prescribed mileage restrictions and not incur any additional charges. This is useful as it caters specifically to your needs and allows you to have the convenience of easy travel without any of the additional expenses associated with owning a car.
Families If you have a family then a long-term car rental option is ideal. This is for people looking for a reliable vehicle for school runs, weekend trips, and any other needs the family may have. Having a car for a longer period offers stability and allows the family an opportunity to build routines and establish expectations.
Business professionals If you are a business professional who needs a car but is not interested in committing to a vehicle loan, then this option will work for you. This works best for those who need a long-term car for work-related travel, whether it be from home to the office or client to client. This option offers all the freedom of owning a car without the hassle of dealing with vehicle registrations, license disk renewals and other car-related admin.
For the Flexible & Spontaneous Driver
If you are a driver who values adaptability and convenience in your life, then a car subscription is the ideal car rental option for you. It offers the ultimate flexibility for someone who wants to enjoy a variety of vehicles as and when they need them, without the long-term financial commitment expected from other car rental options.
Frequent travellers or digital nomads We live in an age where most jobs can be done remotely, which has allowed many people the opportunity to live in whichever area they desire. Digital nomads are often relocating to new cities and sometimes new countries. This is why car subscriptions suit them more, as these types of drivers often want short-term mobility without long-term contracts.
This allows them the privilege of having a car at their disposal whenever they arrive in a new territory. An additional benefit is that the cars they choose can be specific to the region they choose, with some choosing bigger cars for rural living, and others choosing smaller cars for city living.
Expats and temporary residents Expats are people living in a foreign country, they tend to be older people who have retired. Because of their age, they often choose not to take on any new long-term financial commitments like car loans, they usually are looking for a car to use daily without committing to a lease.
Similarly, temporary residents might find themselves needing a car for daily use. These people might only be in the country for a short period, deeming it unnecessary to take out a loan for a car or to commit to a long-term car lease.
People who enjoy variety If you are a car-obsessed person, who is always looking to experience the newest and latest models then a car subscription will also work for you. If you want the freedom to switch vehicles based on your needs and personal interest then getting a car lease will not work for you.
The variety available from a car subscription offers freedom of choice and satisfies that inner hunger you have for the thrill of driving different cars regularly. For you, the higher fee is more than worth it as the benefits far outweigh it.
City dwellers Living in the city usually offers a person a range of transport options, from public transport and e-hailing to vehicle ownership and rental. Some people are not willing to commit to one or the other, choosing to keep all options open. This allows them to use the mode of transport best suited to their needs at that specific time.
Car subscriptions come as an additional option for city dwellers who only need a car occasionally and want an all-inclusive cost structure. It allows them to have an additional option to choose from when in need.
For the Full-Time Car Owner
While leasing and subscriptions offer flexibility, many drivers ultimately choose car ownership for the long-term benefits and independence it provides. For all these types of people convenience and security are major factors contributing to the choice they make, this is the case for people who choose to purchase cars.
Brand new car buyers These people often buy new cars because of the service warranty, modern features and in some cases brand loyalty. They want to drive a car that has no prior history and comes fresh out of the box. This could be a habit that they maintain every few years or a vehicle they intend to keep for the foreseeable future.
Secondhand or inherited car owners There are many reasons why some people purchase secondhand cars, it could be budget constraints, disinterest in modern car trends, the need for a simple means of transportation and many others.
The choice is predetermined for people who inherit cars as they are not likely to have played a role in how or why the car was chosen by the original owner. This means that the condition and age of the car are factors they have to contend with and work around.
These people can take pride in the fact that the car they drive belongs to them or will remain theirs once they are done paying off the loan. With ownership, however, comes the responsibility of keeping your car safe, well-maintained, and always accounted for.
Car security is a priority for all drivers, regardless of whether they are driving a leased car or one they own. Knowing that you are protected while on the road is a non-negotiable, especially for people whose cars belong to them. This is why getting a reliable vehicle tracking provider is crucial.
If you are a car owner who wants to have their car covered in the case of theft or an emergency then Cartrack is the provider for you. Our solutions and offerings give you flexibility, affordability, and convenience, allowing you to focus on enjoying the car that you’re in.
There are many reasons to consider us as your provider, let’s explore some of them.
Flexible Pricing Plans
Cartrack offers a range of pricing options starting from R99 a month. These options come in three packages: Quick, Quick Silver, and Quick Gold. The Gold option is the most comprehensive and offers all the benefits, these are:
For ultimate convenience, Cartrack comes with a mobile app that gives you a real-time overview of where your car is and what it is doing. Here is a list of the features you will get as a driver:
Trip History This feature allows you to review past journeys and mileage. You get to see where you have been along with allthe driving mistakes you made along the way. These include: harsh braking, harsh turning and speeding.
Remote Vehicle Surveillance From the app, you receive instant notifications for suspicious activity, such as when your is being used. These will let you know if your car is being moved without your knowledge. This is done throughCarwatch, a special feature that acts as a virtual car guard.
It is this tracking technology that aids us in quick and efficient vehicle recovery. We are one of the industry leaders in this aspect, coming with an audited 90% stolen vehicle recovery rate. Our recovery teams are skilled and, in some cases, recover a car less than 30 minutes after it was stolen, and sometimes before the car owner is even aware it has been taken.
Geofencing
If you are looking to enhance your safety, then you can create geofences for your car.These are zones that you would have created boundaries around, often for areas that you deem as high risk. When your car enters this location you will get a notification, this is often useful when lending your car to a friend or loved one.
Roadside Assistance
One solution we offer is calledProtector, an emergency assistance feature that is deployed whenever it is called upon by the customer. From this feature you get medical, roadside and legal solutions, all at the push of an emergency button.
All the solutions mentioned above will make it easier for you to get around with peace of mind, should anything unexpected happen to you.
Stay Protected No Matter How You Drive
With Cartrack on your side, it won't matter whether you are leasing a car or on a subscription, we will have you covered and protected regardless.
