http://www.milforddailynews.com/business/x853702428/Getting-a-charge-out-of-leasing-an-electric-car Getting a charge out of leasing an electric car By D. Abraham Ringer/MetroWest Daily News Aug 18, 2013
With gas prices in constant flux, electric cars are looking more attractive. But if you’re like me, the high sticker price of owning an all-electric, 100 percent emission/gas-free car can be hard to stomach. Even after the $7,500 federal tax credit offered to purchasers of electric cars, it is difficult (if not impossible) to offset the expense with the savings on gas. However, due to the car manufacturers’ current lease incentives and the tax credit on electric cars, the math has changed. The cost to purchase a base-level Nissan Leaf is $28,800, and the tax credit brings that cost down to $21,3002. If you selected a 60-month, zero-interest, zero-down loan, then your monthly payment - ignoring taxes and any additional costs - would be just under $480 ($355 after you average in the tax credit). However, if you lease a Nissan Leaf, then the full tax credit offsets the amount you owe during the lease period. The credit gets paid directly to the lease financing company and is factored into the lease payment, so no need to worry about filing it on your own return. Thanks to the credit, Nissan offers a lease deal on the Leaf for $199/month, for 36 months, with $1,999 due out of pocket. Ford and Chevy are making similar offers on their electric vehicles. If you averaged in the required down payment, then your true lease payment would be $255 per month. If you spend over $250/month on gas with a traditional vehicle, then it’s possible you could wipe out the entire cost of the lease and added costs with the money you’d save on gas. As a Certified Financial Planner practitioner, I would normally recommend buying a car outright rather than leasing it. However, in this case I believe that leasing represents a better value, because the tax credit is applied entirely to what you owe on the lease. In the case of the Leaf, the $7,500 is applied to the approximate full lease cost of $16,664 rather than the full purchase price of $28,800. Back to the original question: how can we offset the cost of leasing an electric vehicle to achieve an overall (close to) net zero? Here’s my story. My wife and I own one car: an SUV that guzzles premium fuel. Even though we both take the T into work daily, we still end up spending around $250 dollars a month on gas. We have only needed to own one car for the past five years; however, with two young boys participating in different activities we’d been considering a second car. By leasing an electric car and using it as our primary car, I estimate that we can save around $200/month on gas. According to fueleconomy.gov the cost to drive the Nissan Leaf 25 miles is 87 cents in electricity charges. The cost to drive my SUV 25 miles is $6.68. The monthly savings on gas alone covers the entire lease payment on the Leaf. There are, of course, other costs associated with leasing a car, such as sales tax, the Massachusetts excise tax, insurance and registration. However, it certainly makes the marginal cost to add a second car incredibly reasonable. Maintenance costs on an electric car are also very reasonable and most often less expensive than a normal car due to fewer moving parts. You’ll never need an oil change! There are other perks to owning an electric car. Some areas have parking spaces reserved for electric vehicles where you charge your car for free. You can also charge your electric car at home with a normal everyday 120v plug. The charge will take anywhere from 10 to 20 hours depending on the car. Additionally, electric cars are amazingly fun to drive because they accelerate so quickly (no transmission). Oh, and did I mention they produce zero harmful emissions? If you can get over the common "range anxiety" of owning an electric car, then I believe it’s well worth it to consider. A typical electric car can travel 80 miles on a charge. As for me, I’ll be picking up my electric car on Friday. D. Abraham Ringer of Newton is a financial adviser with Morgan Stanley Global Wealth Management in Boston ... The information contained in this article is not a solicitation to purchase or sell investments ... [© 2006-2013 GateHouse Media] For all EVLN posts use: http://electric-vehicle-discussion-list.413529.n4.nabble.com/template/NamlServlet.jtp?macro=search_page&node=413529&query=evln&sort=date Here are today's archive-only EV posts: EVLN: Envision EV ARC public EVSE, autonomous, mobile, solar-powered EVLN: Only 25 Focus Electrics destined for UK roads EVLN: Iowa plugin owners say electricity adds spark to driving EVLN: Is Tesla-S The Best Way To Sell Politicians On EVs? 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