Short-term leases preferred to longer contracts by a third of drivers

A significant minority of drivers believe short-term car leases are more beneficial, because of the financial flexibility offered, new research suggests.

Sogo researched attitudes towards personal financial commitments and car ownership and found 37% favoured a short-term lease.

It also revealed that a third of motorists (32%) say they are far less likely to replace their existing car by committing to a long-term (three-year) lease than they were 12 months ago.

Karl Howkins, managing director of Sogo, said: “As the economy faces significant challenges, flexible leasing allows short-term demand to be met without the problems of a long-term commitment in an uncertain market.

“Monthly leasing frees capital from the balance sheet that can be deployed elsewhere in the company to fund growth.

“While many managers may not yet be able to transition out of traditional lease models immediately, it’s useful to start thinking about the mix across fleets.”

The company, which offers short-term vehicle deals, believes that short-term leasing will be essential to the mass adoption of electric vehicles (EVs).

Sogo’s research revealed that 30% of respondents believe that short-term leasing a car will speed up efforts to reach net zero. the process to net zero carbon by 2030, compared with 9% who don’t believe it will have an impact.

Howkins concluded: “Analysis of recent car trends indicates that not everybody needs their car as much as they used to, especially with more people working remotely or from home becoming more commonplace in the workplace.

“Considering a short-term flexible lease offers a great alternative to longer leases. With the ban on petrol and diesel cars coming in 2030, a shorter lease deal on a new, environmentally-friendly and cheap-to-run car offers huge appeal.”