There’s always been a stigma revolving around leasing a car. Even in my eyes, it follows similar principles to that of renting your home instead of owning. You miss out on benefits such as tax cuts and equity. I would never have thought I would one day lease a car, which is basically a long-term rental if you look at it. But I decided to enter into a Ford Focus Electric lease because once the numbers are laid out, it makes perfect logical sense. I looked into many other electric vehicles before choosing the Ford (such as the Nissan Leaf, Chevy Volt, Toyota Prius) but ultimately I wanted a car that required no oil change or emissions, thus erasing gas costs completely from my budget, and also had a long enough electric range to accommodate my commute times.
Scenario: Currently I’m leasing a Ford Focus Electric and I live in the DC area, paying around $200 per month for the lease, on a 3-year term. I used to drive a Lexus IS 250.
My Current Lexus IS 250
Loan Payment: $450/month (I still had 3 years left on my loan)
Maintenance: I used to take it in every 4 months for maintenance and paid around $200 for everything which averages out to $50 a month (oil change, filters, rotations, alignment).
Ford Focus Electric Lease
Lease: $400 (Lease term: 3 years)
Insurance: $80/month (required minimum insurance for a leased vehicle)
Electricity: ~$30 a month
The Ford Focus Electric has a battery capacity of 23 kH. Under Dominion’s EV Pricing Plan you can get $0.0513 per kH. This can be done easily by setting up the car’s charging schedule.
Maintenance: Once every 10,000 miles. And “maintenance” involves topping off fluids, alignment, and rotation. There’s no transmission.
So Why Ford Focus Electric Lease?
The residual cost of the Ford Focus Electric lease after 3 years will be around $15,000 which is around the expected depreciation rate after 3 years anyways for someone who owns it. The monthly lease payments integrate the $7500 electric vehicle tax credit incentive, something I wouldn’t have received since, with my income, I would only use about $1000 of tax credit per year to pay my taxes. The other $6500 would be a wasted opportunity cost.
Also, with EV’s still being new to the market, the chances of better EVs in production after 3 years is likely to happen.
Of course everyone’s scenario is different. My daily work commute is around 20 miles round-trip. I don’t need a full charge every day so charging between 1am and 5am is enough for my vehicle. I don’t need a level 2 charging station and there are many free charging stations around the DC area. This made it a lot more sense to go with the Ford Focus Electric than keeping the Lexus. Not only are fuel costs lower but sometimes free!
If you’re deciding on joining the electric vehicle realm, consider your options. There aren’t many cars with a lengthy electric range sans the Tesla. The Ford Focus Electric has a standard range of 76 miles which will suffice many daily commuters. Throw in a level 2 charger and it opens up more options to travel outside of work. However an EV is not practical for long distance driving so always consider a secondary gas-based car in the household should any emergencies arise.