If you’re thinking of getting a Range Rover or Land Rover, but aren’t sure whether to rent, buy, or lease, it’s easy to seem overwhelmed by the options available.
Before getting drawn in by some of the head-turning low headline prices, it’s important to keep a cool head, and understand the costs and benefits associated with each option. This is especially the case if you don’t drive very much, and you just want access to a great vehicle from time to time.
For those living in London, this is a situation that you may be familiar with. You don’t need to drive to work, as hopping on the tube or on your bike is far more convenient. Your weekends are often filled with making the most of this fantastic city, and (again) the tube, bikes, and Uber are perfect for nipping around within the M25. But you know that you want a fantastic car, and driving a Range Rover, well, it just feels great.
There are a plethora of options available, and before you make a choice on what option to go for, you’ll need to ask yourself some hard questions.
- What kind of car are you looking to drive?
- How often will you drive it?
- How many miles a year do you think you’ll do?
- Do you want the flexibility to change?
- Are you prepared to deal with the administration that comes with running a car?
- Are you happy to pay a big sum up front, or would you rather pay on a monthly, or even ‘per-use’ basis?
We’ll dive into the questions in a minute, but let’s recap on some of the terminology you may hear.
Renting: Similar to ‘pay as you go’. You pay for the days you need the car, and that cost includes everything. When you don’t have the car, you don’t need to worry about it.
Leasing: Whilst similar to renting, you should think of Leasing as a (very) long term rental. Many companies require you to put down a hefty deposit, and when your lease is up, you return the vehicle to the leasing company.
Hire Purchase: Hire Purchase is like Leasing, but with the difference that you put down a deposit and then start paying off the vehicle. After a set number of payments, the vehicle is yours.
Personal Contract Purchase (otherwise known as "PCP"): A little like Hire Purchase, but with the twist that you get the option to buy the vehicle with a lump sum payment at the end. PCP has got a bit of a bad rap recently, and before taking on any contract you should make sure you know exactly what payments are due at any time.
Personal Car Loan: As the name suggests, a personal car loan is a loan you take out, typically with a bank, where you put down a deposit, arrange monthly payments, and by your last monthly payment you have completely paid off the car. You also own the vehicle immediately after your first payment, unlike Hire Purchase or PCP where you have to wait until the end of the contract (and in the case of PCP, a sizeable last payment).
Pay upfront: A rarely used option, but if you happen to just have the cash ‘lying around’, then there’s nothing stopping you paying for the entire vehicle upfront. Prices start at £68,155 for a new Range Rover Sport.
Jargon buster over, let’s take a closer look at the questions you need to ask yourself when thinking about what options to go for.
What kind of car are you looking to drive?
Perhaps you know exactly what kind of make and model you’re looking for, or maybe you have a bit more flexibility. In any case, make sure you understand the type of car you’re looking for, as this will help you narrow down the search and mean you can focus on getting yourself the right kind of deal.
Whether you’re walking into a dealership or browsing online, it’s very easy to be distracted by upsells, sparkly offers, or the latest new thing. Having an understanding of what you need and what you want beforehand means that you’re less likely to be distracted. And by distracted, we mean upsold.
This article will focus on the economics of running Land Rover vehicles, and so if you're in the market for something more hatchback-like, then this isn’t the one for you.
Firstly, if you’re not really sure what vehicle you want, then you should start by renting.
It’s the ‘no commitment’ version of car ownership, and means that you can pick and choose the vehicle you want for the trip you’re going on. Perhaps you’ll settle on your favourite set of wheels, or perhaps you’ll keep on flitting between them. It’s your choice.
How often do you need to use a vehicle?
Think long and hard about how frequently you actually need to drive the car. Every day? A few times a week? Once a week? Or is it actually much less frequently, and you just want to be able to drive a Land Rover or Range Rover on the odd occasion that you want to get out of the city.
If you’re looking to just use it occasionally, but you want the flexibility of knowing that you can hop in a car at the last minute, THE OUT delivers a car to your doorstep with just 3 hours notice. So you can be at your desk at 3pm on a Friday, have that brilliant idea to head off on a roadtrip at 3.10pm, and be cruising down the fast lane of the M4 by 7pm.
How many miles a year do you do?
While it’s important to think about how often you will need a car, it’s also crucial to not forget to calculate how many miles you’re planning on doing. Is it just 50 miles a week, the UK average of 7,134 miles per year, or are you planning on going on a few whopper road trips around Europe?
Most leasing and PCP companies will put a mileage limit on how far you can go. The reason behind this is that the residual value (the value of the car after it’s been used) decreases in line with the mileage, so (surprise surprise) the fewer miles on the clock, the more it can be resold for.
Some companies offer unlimited mileage, and so if you’re planning on really cranking it up a notch, check out companies like Carpe.
With rental, it’s also important to be aware of the mileage restrictions, otherwise you may be in for an unpleasant surprise when you hand over the car. Most of the traditional rental companies, where the profits are made on upsells, extras, and additional charges, will add up to £0.65 per overage mile driven.
With THE OUT ‘unlimited mileage’ comes with every rental, and so if you’re planning on doing some serious roadtripping, then this is worth bearing in mind. We should say that there’s a ‘fair usage’ limit of 600 miles per day, but given that this means that you can get to Inverness and back in a 1.5 day rental, unless all you want to do is drive up and down the country without a break, you shouldn’t go over this.
Do you want the flexibility to change?
As with everything in life, if you buy something outright, or commit to a long lease, then you have less flexibility to chop and change. If you know exactly what you want, then options like buying, or taking on a lease could work out well for you, depending on your answers to the previous questions.
If you want the flexibility to drive different cars, or you may need a vehicle now but not in 3 months time, then renting is an option worth considering.
Many car rental companies will offer large discounts for long term rentals, and prices at THE OUT drop to £65 per day for rentals of 28 days or more.
In addition, if you want something like a Jaguar I-PACE for the summer weekends, but then want to switch into a Range Rover Sport for the winter months, then renting may well make sense for you.
If you know exactly what you want, you are prepared to commit to a set period of years (normally at least 2), and you need a vehicle relatively frequently, then renting may end up being a more costly option.
Are you prepared to deal with the administration that comes with running a car?
You’re busy, we’re all busy. And there’s no way of getting around it - dealing with all of the administration of running a car is boring and tedious. Tyre pressures, next service dates, insurance, paying the Congestion Charge. It’s not fun and it takes up the time that you’d rather spend doing things that actually matter.
Renting a car long term means someone else is dealing with all of this, and you can be sure that you’ll get a car that’s in perfect condition every time you need it. Yes, doing it all yourself saves you a bit of money, but if all you were worried about was saving money then a Range Rover might not be at the top of your list.
Are you happy to pay a big sum up front, or would you rather pay on a monthly, or even ‘per-use’ basis?
If you’re still thinking that you want access to a car 24/7, then it’s worth factoring in that most leasing or finance companies will require a sizeable deposit upfront. Yes, £10K may not seem like that much compared to the value of a Range Rover Sport, but there are probably more exciting things to do with that £10K than put it as a downpayment on your car.
With rental, it’s a simple pay per use. No large upfront payments, you just pay for when you need the car.
The economics of car ownership
So, how do the numbers actually stack up? We’ve compared the numbers for those renting a Land Rover Discovery Sport and Range Rover Sport with THE OUT, and you can calculate this against some popular leasing and finance options. The results may surprise you.
We’ll be comparing this against the ‘cost of ownership’ of a brand new Range Rover Sport. There are multiple different ways to calculate this, but if you want some flexibility, once you factor in depreciation, insurance, road tax, and all the rest, you are unlikely to have much change from £15,000, so that’s a cost of £1,250 per month.
For those happy to commit to longer contracts (normally a minimum of 4 years), there are Range Rover Sport deals for around £600 per month, however they usually come with low mileage restrictions, a downpayment of £5,000, and inflexible terms.
So, let's look at a few use cases for 'infrequent drivers', and how much this would cost with THE OUT.
The “just a couple of little roadtrips” driver (2 weekends a year)
If you just need the car for a couple of trips per year, then renting a Land Rover Discovery Sport for a weekend, then renting a Range Rover Sport when you feel like pushing out the boat a little will set you back just £750 per year.
The “every couple of months” driver (6 weekends per year)
If you like weekend roadtrips, but maybe you’ll want to head away every couple of months, splitting your trips between a Land Rover Discovery Sport and a Range Rover Sport, then your costs are likely to be around £2,300 per year.
The “once a month roadtrip” driver (12 weekends per year)
There’s a lot of the UK to explore, so we wouldn’t blame you if you need a vehicle once a month. Again, assuming that you split your trips between a Land Rover Discovery Sport and a Range Rover Sport then you’re looking at around £4,500 per year. Throw in a week long roadtrip over the summer in a Discovery Sport and this will bring your annual costs to just north of £5,000
The “let’s get out of town (almost) every weekend” driver (48 weekends per year)
If you need a vehicle more frequently, and you’re planning on doing a roadtrip almost every weekend then you’ll end up at around £18,000 per year. It’s more comparable with the cost of having a vehicle full time, but without the stress, administration, and with the added flexibility that you can get the vehicle of your choice whenever you want, without any of the tedium of owning it.
Interested in ditching ownership for rental, or you just want to get your hands on a new set of wheels for the weekend? Download THE OUT app and hit the road today.