Electric Car Leases: Are EV Deals Worth It?
Leasing an electric vehicle has advantages, and in some cases it can be a better option than buying.
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Electric vehicles (EVs) have become more popular in recent years, and so have electric vehicle leases. EV purchases hit a record 1.3 million in 2024, according to Kelley Blue Book. And, in the 2nd quarter of 2025, Experian Automotive notes that 58% of new EV purchases were leases, an increase from 47% at the same time the previous year,.
Whether this upward trend will continue remains to be seen, with a federal EV tax credit no longer available as of the end of September 2025. The good news is that many car manufacturers have begun offering their own incentives — for leasing and purchasing — to continue driving EV sales.
How do electric car leases work?
Leasing an EV is really no different than leasing any other type of car.
A lease contract lets you use a vehicle for a set period, typically two to three years, and return or buy it (if you have the option) at the lease’s end.
With a lease, you don’t pay for a car’s full value. Your monthly payment is based on the difference between the new vehicle’s cost and its expected value at the end of the lease, called the residual value. In other words, you pay for the amount the car depreciates while you’re driving it, along with your finance charge and any taxes or fees you add to the lease amount.
Because a lease’s intent isn’t for you to pay the full value of the car and eventually own it, you finance less, resulting in lower monthly payments.
» MORE: How to lease a car
Are payments lower for an electric car lease?
Even without special offers, leasing an electric car usually has a lower upfront cost and more affordable monthly payments when compared to getting an auto loan. For EVs, the average lease payment was about $175 less than an auto loan payment in the 2nd quarter of 2025, according to Experian.
EVs tend to have higher sticker prices than gas-powered cars, so paying less upfront and monthly might enable you to drive a newer or more premium EV without stretching your budget.
» MORE: Should you lease or buy a car?
Finding current EV lease deals
During the COVID-19 pandemic, fewer people leased vehicles, which led to a shortage of lease returns and used cars for dealerships to sell. To encourage more leasing and restore the supply of off-lease vehicles, many automakers began offering attractive lease deals, including on EVs.
Now, carmakers are using incentives to offset the loss of the federal EV tax credit and maintain the momentum of EV leasing. You can visit auto manufacturer websites (like those listed below) to see the latest EV leasing deals for your area.
Advantages of electric vehicle leases
Access to the latest technology. Leasing allows you to upgrade to a newer model every few years, so you’re not stuck with an outdated vehicle as the industry advances.
Limited long-term commitment. Most lease terms last only two to three years, so it’s a great option for anyone who’s still figuring out if EV life is right for them.
Fewer worries about depreciation. New cars can lose about 20% of their original value in the first year and then about 10% annually in the next four years. If you finance to buy a car, and suddenly its market value drops, you could end up owing more than the car is worth. However, when you lease, you only pay for the expected amount of depreciation during the lease term.
» MORE: Lease buyout loans
Potential downsides to leasing an EV
Mileage restrictions. Leases come with mileage restrictions, usually about 12,000 miles annually. If you surpass your limit, you may pay a fee of about 25 cents per excess mile when the lease ends. EV drivers do tend to drive less, so mileage limits may be less of a concern when compared to leasing a gas car.
No equity or ownership. At the end of a lease, you have no equity or ownership in a vehicle. The car provides no trade-in value to put toward acquiring another vehicle. Also, when you continuously lease, your car payment never ends.
Potential fees. Leases can have fees you might not anticipate, and these can add up. In addition to mileage fees, you could be charged for excessive wear and tear when the car is turned in. If you decide to end the lease early, there may be an early termination fee. The leasing company could also charge an acquisition fee to set up the lease, along with a disposition fee to cover preparing the car for resale when you return it. Before you sign a lease agreement, read it carefully to determine the exact fees you will have.
Why an electric car lease might be a smart move
With possible lease deals and incentives, lower upfront costs and short-term flexibility, leasing can be a great way to drive a new EV. It’s especially worth exploring, if rising car prices and payments have pushed financing affordable transportation out of reach.
As the EV landscape continues to evolve, technology advances and more models become available, an EV lease gives you the freedom to adapt without the long-term commitment of car ownership.