Finance for electric vehicles

A PCP depends on the lender guaranteeing a future value. Electric vehicle values have moved sharply in recent years as technology, range and supply have changed, which makes that guarantee harder to set.

The practical effect is that guaranteed future values on EVs can be conservative, which pushes the monthly payment up. On the other hand, a guaranteed value transfers depreciation risk to the lender — which on a fast-moving market is worth something.

Most of the usual checks apply, plus a few that only matter on an EV.

• ✓ Battery state of health, which many vehicles will report from the on-board diagnostics.
• ✓ Whether the manufacturer battery warranty is still in force, and whether it transfers.
• ✓ Real-world range at the current state of health, not the original brochure figure.
• ✓ Charging speed the vehicle actually supports, which varies a lot between models.
• ✓ Whether the battery is owned outright or on a separate lease on some older models.

A higher monthly finance payment can still leave you better off overall, depending on your mileage and where you charge. Home charging on an off-peak tariff is dramatically cheaper than public rapid charging, so the answer is different for someone with a driveway than for someone without.

Servicing is generally lighter, and Vehicle Excise Duty and benefit-in-kind treatment for company drivers have both changed in recent years — check the current position before assuming.