Why buy a used car, when you can drive home a new one for less?
A new world order is falling in place.
Covid-proofing your mobility is the need of the hour. A whole new generation of first-time car buyers is looking for budget options to drive personal mobility. While there has been a spike in the number of people looking to buy used cars, here's why you should choose the better, cheaper option – Car Leasing.
Don't just settle for anything.
Buying a used car, more often than not, ends up being a tough ordeal. Knowing what to buy, looking at dealers or private sellers, quality checks, financing, repairs and touch-ups as required - you take on all these tedious tasks, but you may still end up short of a good purchase, which matches your taste and preferences.
Maruti Suzuki True Value, a major player in used cars, is facing a crunch in sourcing used cars for the market, says Shashank Srivastava, executive director, marketing & sales, Maruti Suzuki India. “Consumers are holding back their cars; they are not upgrading as fast as they earlier did. So, lesser vehicles are coming into the market. On the demand side, the requirement for personal transportation has increased due to social distancing norms — and public transport hasn’t yet fully opened at many places — but supply is a challenge,” he said. Lesser vehicles coming into the used-car market means lesser options for you to choose from.
With car leasing, however, you can select a brand-new vehicle of your choice. You choose the make, model, colour etc. while we make it easier for you to drive home your favourite car. Why settle for a decent deal, when you can get a great one?
Don't be rattled by hefty down payments or interest rates.
When you set out to buy a used car, you're either looking to finance it, or maybe even buy it outright with cash. But either of these options invariably means setting aside money for a hefty payment upfront. It is also true that the interest rates are higher (by 3-7%) than what lenders offer on new cars. “Interest rates for used-car loans are generally higher compared to loans for new cars. For lenders, the risk is higher with a used car. It’s difficult for them to ascertain the history of a pre-owned vehicle," says Abhinav Kaul, vice-president, strategic partnerships, BankBazaar, an online financial marketplace.
When you lease a car, no deposit or upfront payment is needed. All you have to pay is a fixed monthly lease rental. This allows you to put all that money to better use.
You only pay for how much you drive.
That's right. With a leased car, you only pay according to the pre-decided mileage and tenure combinations, and any add-on services you may opt for. What's more, your monthly lease rental comes out of your pre-tax salary, which means you save big on taxes too, unlike the case when you buy a used car.
Cars get old. Used cars get old faster.
Say you're taking a 3 to 4-year loan, to finance a vehicle which is already 5 years old. By the time you're done repaying the loan, the car is easily 9 years old - way past it's best years. Instead, if you opt for a car lease, it enables you to drive the newest car, with the latest safety, technology and comfort features.
Also, depreciation is already factored into the cost of the lease. Hence, you essentially pay only for the use (depreciation) of the car for the limited lease period (2 to 5 years, typically) instead of absorbing the full cost of the vehicle, like you would for a used car.
Cut out unpredictability.
How well did the previous user maintain the car? Does it come with any hidden issues? Will it perform as well as it should?
"A used car may not come with proper service records maintained by the previous owner. This leads to unpredictability in maintenance costs of the used car, unforeseen expenses and bouts of disappointment during your time with it. Leasing helps you look beyond these worries, so that you can simply enjoy the ride," says Rakesh Bajaj, Director of Operations, ALD India.
Cut out the unpredictability that comes with buying an old car. Your leased car comes sparkling new, chosen by you, and customised for you. This way, you know exactly what you are driving home.
Your new car shouldn't come with old maintenance hassles.
Used cars may need a tweak here and a repair there. But these tiny early repairs could quickly blow up into real maintenance hassles for your time with the car. Whereas with leasing, you don't have to worry about maintenance at all. We take care of it when contracted for, with the maintenance costs included within your fixed monthly lease rental.
Done with this car? What next?
You don't have to be stuck with a blob of metal, once you're done with the car. Leasing ensures you don't have to worry about the resale of the car. You can simply return the car, which will be picked up from your doorstep and, you can look for your next car on lease.
Upgrades have never been easier. Unlike when you buy a used car, leasing enables you to move on to the latest cars in the market once you're done with the lease tenure, allowing you to stay abreast with the very best cars on the road.
Hence, car leasing ends up being a wise and affordable affair, bringing you a wide range of benefits, and to top it all, you can enjoy the 'new car smell' that comes with your brand-new leased car.