Skip advert
Advertisement

Electric car leasing customers are being ‘overcharged’

Research claims that lease prices are out of step with the reality of EV resale values on which they are based

EV charging

Leasing companies have been accused of overcharging for deals on electric vehicles

According to green transport organisation Transport & Environment (T&E), leasing offers for EVs are 57 per cent more expensive on average than for their equivalent petrol models. For example, leasing an electric Peugeot e-208 costs approximately £509 a month, but the petrol model is offered at £329.

The group says that leasing companies typically charge customers for the expected loss in value of a vehicle over a three or four-year lease, with higher prices meaning they expect EVs to lose more of their value. However, T&E says its analysis shows that EVs have similar resale values to diesel and petrol vehicles, so more expensive EV lease deals are “unjustified”. The group analysed 2.7 million used car prices and found EVs do not depreciate any faster than petrol or diesel cars.

Advertisement - Article continues below

At the time the data was analysed, depreciation for EVs in Europe’s biggest markets (Germany, France and the UK) was on par with diesel and petrol. A difference was detected in Spain, but the gap was seen to be closing.

Stef Cornelis, director of electric fleets at T&E, said: “Today, customers are being overcharged by leasing companies if they want to switch to a battery-electric car.

“Leasing firms are too conservative when setting their monthly prices. Their rates reflect the state of play from five years ago. With this pricing strategy, their profits are obviously high and consumers are overpaying to go electric. At the same time, they are harming the EV transition.”

Peugeot e-208 - front

However, the story isn’t so simple, according to Adrian Dally, director of motor finance and strategy at the Finance and Leasing Association. He told Auto Express: “It isn’t so much where residual values go – what matters is volatility and predictability.

“Residual values have been collected for petrol and diesel vehicles for 80 or 90 years, and every day thousands more data points go in, so you can predict with great confidence what future values are going to be.

“EVs are a much newer technology and the vehicles change rapidly. That creates volatility in prices – your residual values are all over the place. T&E’s data was taken at a moment in time and related to what residual values were like then. But if you look at the data now, EV residual values are going down quite rapidly.”

Now check out the best electric cars to buy...

Skip advert
Advertisement

Find a car with the experts

Skip advert
Advertisement

Recommended

Volkswagen leasing deals 2025
Volkswagen Golf facelift 2024 UK - front tracking

Volkswagen leasing deals 2025

The best Volkswagen leasing deals available right now
Best cars & vans
27 Jun 2025
Car Deal of the Day: Comfy and chic Renault Scenic electric SUV for under £235 a month
Renault Scenic UK - front cornering

Car Deal of the Day: Comfy and chic Renault Scenic electric SUV for under £235 a month

The Scenic has always been a family favourite, and can be had at a tempting price. It’s out Deal of the Day for 28 May
News
28 May 2025
Car Deal of the Day: Seal the deal on this BYD electric saloon for just £289 a month
BYD Seal - front

Car Deal of the Day: Seal the deal on this BYD electric saloon for just £289 a month

The BYD Seal is a seriously tempting Tesla Model 3 rival, especially at this price. It’s our Deal of the Day for 26 May
News
26 May 2025
What should you do at the end of a PCP car finance agreement?
Short-term lease

What should you do at the end of a PCP car finance agreement?

Make sure you choose the right option when your PCP deal ends
Tips & advice
23 May 2025

Most Popular

Range Rover Sport SV gets massive £35k price drop as it enters series-production
Range Rover Sport SV Black - front

Range Rover Sport SV gets massive £35k price drop as it enters series-production

There’s also a new SV Black trim, and a Range Rover Sport Stealth Package for non SVs
News
1 Jul 2025
Arrivederci Roma: new Ferrari Amalfi slots in as brand’s latest entry-level model
Ferrari Amalfi - front static

Arrivederci Roma: new Ferrari Amalfi slots in as brand’s latest entry-level model

A slick new look and more power are the headlines for Ferrari’s new baby, but it’s probably some simple new buttons that will get customers’ attention
News
1 Jul 2025
Geely is coming to the UK, and its assault will start with EX5 SUV
Geely EX5 - front

Geely is coming to the UK, and its assault will start with EX5 SUV

Geely has looked to Lotus to ensure it's new electric SUV lives up to our driving expectations
News
2 Jul 2025