Let’s discuss the negatives of a car subscription

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Lady thinking of a car

Whilst we have spent a lot of time covering the positives of a vehicle subscription, today we’re going to cover some of the negatives that you may not have thought about.

So here goes:

Cars may not be new

Not all of the car subscription companies offer new cars on their subscription programs, you may find that when you sign up that the registration number that has been allocated is almost 1 or 2 years old. But there are companies that offer new and pre-registered cars, just click on the highlighted link to find out more.

Difficult or Costly to add additional drivers

For the car subscription companies that offer free insurance, you may find that only 1 person is included in the advertised price. To add an additional driver could incur additional monthly premiums, something you may not have accounted for.

You need to remember that you’re only borrowing the car and you may not even be able to lend the car to someone who can cover the vehicle on third-party insurance, all car subscription cars need to be covered by a fully comprehensive insurance policy at all times.

For those who want to keep the vehicle open to others, it may beneficial to look at providers that do not include insurance, this way you sign a waiver to say that you are responsible to ensure that all drivers have the correct fully comprehensive insurance and driving licence requirements for the UK.

Costs more than traditional car leasing

Yes, it can be true that a car subscription can be more costly than leasing a vehicle over 24 or 36 months, but if you need flexibility in your life or the ability to change your vehicle on a more regular basis, then a car subscription is hugely appealing.

Many of the firms offer monthly rolling car subscriptions, so you’re never tied into a set period. If you were to run a 24-month car lease over the same period, and want to change after 12 months, you will incur early termination charges, this is usually equivalent to the remaining rentals of the contract, with no benefit at all in sending the car back.

Also, many of the car leases advertised require an initial rental which can be equivalent to 3, 6, 9 or 12 of the monthly rentals, car subscriptions generally require you to pay the first month plus a joining fee.

You’re paying towards a car you’ll never own

You certainly will be paying towards a vehicle you will never own, as you’re effectively renting the vehicle over a longer period. The car will never be owned by yourself and you will not gain any benefits from huge market changes as you would if you were to finance the same car via HP or PCP.

But do you really want to own a car, that depreciates and that requires regular maintenance? Car subscriptions include the main motoring essentials such as maintenance and servicing, breakdown assistance and road fund licence. Whilst a ”cheap banger” might look appealing, it may be a huge money pit.

Membership Fees or Documentation Fees

Yes, firms may be charging a joining fee or even a documentation charge. But these charges may also be payable on a traditional lease or finance agreement, it is just hidden in the small print and called a processing fee or something else.

The membership fees or documentation fees that we have seen aren’t silly money and will only make the vehicle expensive if you swap the car on a more regular basis ir need the subscription over a month or two. Otherwise, they are very reasonable.

Mileage Restrictions

Whether you subscribe to a car or lease a car, they will all come with a mileage allowance. Even PCP’s!

Many of the vehicle subscription companies will give you a very generous basic mileage, usually around the 800 mark and you can ”bolt-on” additional mileage packages to increase this restriction.

Companies such as Flexed and Cocoon Vehicles automatically give you higher mileage allowances of between 1,000 to 1,500 miles per month depending on the vehicle type or brand.

Always make sure that you pick a mileage allowance that suits your work or lifestyle, this way you will then reduce the risk of receiving excess mileage charges.

You may need to pay for collection

Many of the subscription firms may charge you a collection fee at the end of your subscription, this is pretty industry standard and the costs will vary from company to company.

Some of the subscription companies allow you to return the car for free of charge to one of their customer service centres or fleet partners, always check this before committing to a car subscription contract.

You may fail the credit check

That’s right, many of the vehicle subscription companies will carry out credit checks for compliance, always stay clear of those companies that don’t offer credit checks as standard.

Not all companies will use your credit score to make their decision, some use affordability checks to ensure that you can pay the monthly subscription fee.

Always make sure that you can afford the car before signing into the terms and conditions, failing to pay could have an adverse effect on your credit rating.

The car may have a tracker

Many of the car subscription firms fit GPS trackers to their vehicles, this is mainly for security but may also be used to monitor driving styles and mileage restrictions.

You will usually not have access to the tracker facilities, so if it is to keep an eye on your mileage, then we would suggest monitoring where you are from week to week by making note of the mileage on your odometer.

Usage restrictions

Some of the car subscriptions may limit for what you can use the car for. Some may not allow business use and others may not allow hire and reward.

Those that offer van subscriptions may limit the type of companies who take the vans such as couriers or builders.

Return conditions

As this is a short-term product, the vehicle subscription companies do not have to adhere to traditional motor standards fair, wear and tear. So it is really important to understand how you need to return the vehicle.

Don’t forget that catching an alloy on a roadside curb isn’t really fair, wear and tear, it is driver negligence and therefore this will incur charges to refurbish at the point of return.

As already mentioned above, you will also be required to return the vehicle within the mileage parameters.

You may have to pay a Deposit

Depending on your personal circumstances you may be required to pay a refundable or a security deposit on the car.

This will either be advertised on the website at enquiry point or explained to you at the application stage. Some deposits are subject to status, so your credit score may have an effect on the amount you will have to pay.

Compare Car Subscription Providers

Using our website, you can easily compare the benefits of the major car subscription businesses in the UK. If one of the negatives above may push you a particular way, you can use our table to easily find a solution that will work for you.

Patty Atindehou

Patty is the content writer for Car-Subscriptions.co.uk and loves her cars and the automotive industry in general. She worked for large dealer groups in the United Kingdom and the USA specialising in high-end and premium vehicles. Her goal is to provide the most interesting information on the vehicle subscription industry.

Article Details

Post Published: July 15, 2022
Post Last Updated: July 9, 2024
Article Categories: ,
Read Time: 7 minute(s)