This article is part of a series exploring the ABCs of EVs: Affordable, Better, Convenient.
Meet an EV driver: Jessica
Current market trends show that leasing accounts for only about a quarter of new gas-powered car transactions but over half of new EV transactions. Though the mechanism for leasing an EV compared to a gas-powered vehicle remains largely the same, leasing is the most popular option for drivers looking to get into a new electric vehicle.
History Lesson on Leasing EVs
The popularity of leasing an EV is partly due to the structure of the (now repealed) IRA tax credits. For EV makes and models to qualify for the tax credit, there were strict requirements for the battery to be domestically sourced and manufactured. However, those same domestic-source and manufacturing-battery requirements didn’t apply to leasing an EV. This qualified many more makes and models for lease. Thus, more EVs were leased rather than purchased. Although federal tax credits have been repealed, leasing remains a preferred choice for many EV shoppers.
Why Lease Today?
Financial Benefits. There are a few reasons that make leasing an attractive option. First, there are the financial benefits of lower monthly payments. Despite the repeal of federal tax credits for leasing an EV, the average monthly lease payment remains approximately $175 lower than an average auto loan payment. Beyond the lower base lease payment, EVs offer significant savings on operational costs. EV drivers save on fuel expenses and maintenance costs, making the total monthly savings even greater.
When Jessica first leased an EV in 2024, she took advantage of the lower payments because of the federal tax credit of $7,500. The deal also included two years of free charging at Electrify America charging stations. Although the federal tax credits had been repealed in 2026, Hyundai offered the same $7,500 price reduction to keep the lease deal attractive. The free charging deal was also no longer being offered; however, Jessica says she is “still paying much less to charge my car than paying for gas at the pump.”
Technological security. Much like the technology in our smartphones, the tech features in EVs are constantly improving. Leasing an EV allows the ability to upgrade to the latest benefits, like longer range batteries and faster charging times, as the market is quickly evolving. This was a motivating factor in Jessica’s decision to sign a new lease. In the two years since she started leasing, the Ioniq 5 model has increased in range, and Hyundai has adopted the new North American Charging System (NACS). NACS was developed by Tesla and combines AC and DC charging into a single, compact charging plug. This gives vehicles with this port access to the largest charging network in the US, the Tesla supercharging system. Additionally, the car comes with two adaptors (J1772 for Level 1 and 2 charging and CCS for DC fast-charging), making charging seamless no matter what network you use.
Reduced price volatility. EVs have historically shown a steeper initial drop in resale value than internal combustion engine (ICE) vehicles because EV technology improves so quickly. A lessee is more insulated from these price shifts.
Things to Consider
As with any major investment, it’s important to consider all available options. Purchasing or financing an EV might be a better option if you are more motivated to have equity in your car, if you drive high miles annually, which would cause you to pay penalties with a lease, or if fees don’t make the lease pencil out.
Finding the right EV
There are several resources that can be helpful in finding the best EV to suit your needs. Veloz’s Electric for All website allows you to input your zip code and generates incentives specifically for your area, including utility offers. Plug In America’s Plug Star website helps you filter vehicles by preference. It has a lease calculator built in and links to the manufacturer’s website so you can see any lease deals directly from the automaker. Coltura’s Electric Car Deal Explorer website allows users to search and compare electric vehicle models and links directly to EV dealers near you.
ABCs of EVs
If you are interested in lowering your transportation bills this year by switching to electric, learn more about electric vehicles in our “ABCs of EVs” Factsheet. It is full of links to additional information about why EVs are more affordable, better, and more convenient than their gas counterparts.
Community EV Experiences
Check out Elisio’s experience with buying a used EV.
Read about Kathleen’s fuel cost savings after going electric.
Join the Clean Energy Generation
Across the Southeast, people like Jessica are saving money by embracing cleaner, cheaper energy solutions, like driving electric, installing solar, making home energy upgrades, or speaking up for clean energy in their communities. People and communities across the Southeast are building momentum as the Clean Energy Generation, taking action, sharing solutions, and celebrating successes as we transition from polluting, costly fossil fuels to affordable, reliable clean energy. Join the Clean Energy Generation to connect with others making a difference and get monthly updates with helpful resources, inspiring stories, and ways to take action.
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Additional Resources
Consumer Reports | Everything You Need to Know About Leasing an EV or PHEV
