When you plan your budget for your next car, you should be aware of the factors which may affect the price of your monthly subscription. If you want to find the exact cost by make, model and subscription provider, you should check out our car subscription cost research.
In this guide, we explain exactly how the monthly price of a car subscription is calculated.
The very first factor which influences the cost of your monthly subscription is the car you want to get. This may seem like an obvious one, but subscription costs depends heavily on the make, model, year of production and version (or trim).
A single car model is often available in different versions. Say you really fancy getting a BMW 3-Series, well you will be spoilt with choice! There is a 320i M Sport, 320i M Sport Auto, M340d xDrive Touring… to name a few.
More premium models would cost more per month, and normally certain add-ons (such as additional mileage) would cost more too! Check our our car subscription vs car buying guide!
Most, if not all, subscription services in the UK include the maintenance, servicing and MOT in the monthly price. This means they have to forecast the additional cost for any repairs and factor that into your monthly payment.
The cost of MOT is straightforward but when it comes to understanding what a repair for a particular model could cost, then that’s more tricky. Some cars are more reliable than others, spare parts are cheaper for certain makes, and particular cars may require more specialist knowledge and may be harder to service (e.g. EV)
The good news is that pretty much every single subscription provider offers new cars produced within the past 2-3 years, so maintenance on these is likely to be much cheaper.
The terms and conditions of paying a deposit when getting a car on subscription vary from provider to provider.
Some do not charge a deposit or sign up fees so all you pay in your first month is the monthly subscription cost.
As you can see, the deposit can affect the cost of your car subscription quite a lot! The good news is that most providers either don’t ask for a deposit, or it’s refundable. So, you just have to think about your budget in the first month. Check out our in-depth elmo vs. Onto comparison.
The price of a car is another factor which may look very obvious – you want a high-end Tesla Model 3 with all the bells and whistles, well you should prepare to fork out a lot!
However, one of the biggest reasons the value of the car is a huge influence is the fact that more expensive cars could cost more to replace if stolen, or written off in an accident.
Car subscription companies take this into account when they put together their monthly subscription packages. They must work at a profit margin that would allow them to cover all expenses relevant to the car and also leave a small profit for them.
One of the initial payments you may have to pay when subscribing to a car is the delivery fee. Thankfully, most providers can deliver your new car if you live in close proximity to where the car is held. This is normally around 40 to 50 miles.
If you live further than this, you should expect to pay for every additional mile over this. Sometimes this price can go as high as £1 per mile.
There are providers, such as Onto, which offer a flat delivery fee if you want your car delivered anywhere in the UK mainland. The price for this hovers around £100.
Also, in addition to your delivery, some providers have different rates for collection (when you cancel your subscription and have to return the car) and exchange (when you simply want a new car). Swapping your car is normally either cheaper than the delivery fee or is free altogether.
How much you plan to drive is the next factor that requires attention. Similarly to other car finance agreements, such as Personal Contract Purchase (PCP), Hire Purchase (HP) or lease, car subscriptions have limits on mileage too.
Most subscription providers offer up to 1,000 miles a month as part of your monthly package. But this could vary on the provider, car and type of vehicle (internal combustion vs electric vehicles).
For example, Wagonex works with car dealerships and each subscription agreement would largely depend on that. Before you sign it, they will provide you with all the details you need.
Other providers such as Onto have a very clear mileage structure. You get 1,000 miles a month included in your monthly payment, but you can also pay to add more. Just how much depends on the car.
For example, if you want to add an extra 500 miles monthly and you drive an Audi e-tron, you will have to pay £330. For cheaper, lower-tier cars, the cost is £75 for the same distance.
“But isn’t car insurance included in the price?” I hear you ask. It is for most providers, such as elmo, and that makes car ownership so much simpler and easy.
However, other providers take into account more personal information about the driver to provide you with a car insurance quote. So, same as when insuring a car you own, the quote will be just as personalised and the premium would depend on your personal circumstance.
This means the cost would usually depend on:
This tailor-made car for subscription insurance normally also take into account the contract length.
Also, if you decide you want to drive abroad, you will have to mention that when subscribing to a car as you want to make sure you’re covered overseas.
If you want to add even more to your monthly subscription, some providers would let you pick and choose from some handy additional benefits.
The very first one which most drivers would appreciate is additional mileage. As we mentioned above, how far you can drive isn’t that limited when paying monthly. You adjust your mileage every month and buy more as and when you need more miles. Quite handy if you’re planning long road trips!
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My thoughts about this EV after driving it for three months.