Buying a car involves a lot of things - first things first is the heavy downpayment. Well, you need to have in between Rs 1 lakh to Rs 2 lakh to make a downpayment for a mainstream car and then start the monthly EMIs; not to forget the periodic service, insurance renewals and other miscellaneous charges. So, owning a car is really a task. Of course, you would want to own a car without actually going through so many hassles but is that even possible? Well, in today's scenario, yes, it is. It is possible if you have the option of subscribing to a car. In today's article, we bring to you a car subscription vs car buying comparison to try and explain the advantages and disadvantages of both.
Car Subscription vs Car Buying
But what is a car subscription and is it really better than owning a vehicle? In simple words - it is renting out the car. In most cases these days, including the recently released Nissan NIO plans, it is a brand new model that comes to you with a white number plate and you enjoy all the benefits of a private car buyer sans the hassles that come associated with it.
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One of the best parts of these schemes is that the you don't need to stick to a car for a long period of time as you can change to another model at your will. This way, you change the car type as and when you wish to.
Advantages of a Car Subscription
No Downpayment
A car subscription is basically just like any other subscription. You pay a fixed monthly amount and enjoy the benefits that come from having a private car at your disposal. Here, you need to pay a minimal amount and do not have to worry about the downpayment that would hit the savings.
No Insurance, Road Tax Or Whatsoever
Yes, that is true. You are free from the yearly insurance renewal, the road tax, et al. Everything right from insurance to the charges levied by the RTO is taken care of by the original owner of the car. This way, you need not worry about any 'extra' expenditure for as long as the car is in our possession.
No Maintenance Charges
Well, almost all the car subscription companies now offer this as a feature. Since you are paying for the subscription charges, you don't have to pay for the periodic maintenance at all. All of it will be taken care of by the company who legally owns the vehicle you use.
Subscribe To A New Car Whenever Your Want To
Well, almost. There's a fixed duration of time for which you lease a car. Generally, it ranges from 6 months to 48 months. So, basically, you can subscribe to a new model easily once your subscription plan runs out.
Tax Rebate
One of the highlights of these subscription plans is the tax rebate. Yes, you can get up to 30% tax rebate on the subscription fee. This way, you end up with decent savings.
No Need To Worry About The Resale
Since you are subscribing to a car, you need not worry about its resale value. It is basically like you use the car and return it once you want to upgrade to another without suffering any sort of loss due to the heavy depreciation on the value of an automobile.
Buy The Car If You Like
So, let's say that you have changed your mind and are now looking to buy the car you've been using. In this case, most subscription services allow you to do that. You need to wait till the subscription or leasing period expires and then you can pay the market value of the car to become its rightful owner.
Disadvantages Of A Car Subscription
Limited Number Of Kilometres
Well, this is just like renting out the car for a day or a few days. Some car subscription companies set a cap to the number of kilometres the car can do in the period it has been with you. This is actually a drawback for some who have high running. There are additional charges incurred if the car crosses the set number of kilometres.
No To Accessories
Rule out the subscription option if you are someone who always customises the car to suit his or her tastes. Even if you have subscribed to the car for 3 years that doesn't change the fact that you are still not the owner of the car. So, modifying the car isn't really on the cards here.
Not Actually Owning The Car
Having a car to your own name is a different feeling and even a status symbol. So, in a country where buying something is considered greater than subscribing, you might miss the feeling of being the actual owner.
Your first car is always special. So, in a country where buying a car is almost synonymous with arriving in life, why would someone be tempted for a subscription-based service? Let's discuss some merits and demerits of owning a car in India.
Advantages of Buying a Car
You have full ownership
Be it the small accessories to customise the cabin of your car or going for the big modifications. You have full authority over what you can do to your car as it's your car after all.
Drive as much as you wish
Driving a car that comes with a subscription almost always has a cap on the kilometres. But if you own a car, you have the freedom to clock as many kilometres you like.
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Sell it when you want
Unlike in a subscription where you have an agreement for using a car for a certain amount of time, you do not have a similar contract when you own a car. You can sell it a day after you brought it or keep it for a decade - It is entirely your call.
Your Choice Of Wheels
When you buy a new car, you can choose from the several variants and the optional features. You might not have a similar flexibility in the car leasing process.
Disadvantages Of Buying a Car
Maintenance, Insurance, Service
Buying a car is never an easy process. Right from the downpayment to monthly EMIs to periodic service intervals and insurance - You have to take care of just too much expenditure on a regular basis.
Higher Finance Rates on used cars
If you are buying a used car then banks generally provide a loan at a higher rate of interest.
No Strong Resale Value
The value of your car falls drastically once you roll out from the showroom itself. Other factors like the high mileage, condition of car, colour, etc effect the resale value. You are free from such factors when you lease a vehicle.
So what are your thoughts on car subscription vs car buying after going through all the advantages and disadvantages of both? Which one will you choose? Do tell us in the comment section below. Also, make sure you are a member of our 91Wheels Whatsapp group where we bring you all the latest updates related to the Indian Automotive Industry.
