Should you lease or buy your next EV?
EV residuals are wonky — Model Y holds ~77% at 2 years, Lucid Air loses over half in three. Most lease calculators just trust the dealer's number. We use real market depreciation data instead, then flag whether your specific lease quote is genuinely a good deal.
Vehicle & term
Lease quote
Buy quote
Lease deal quality
Why EVs are different
For most of automotive history, lease vs buy was a math problem with stable inputs: residuals were predictable, depreciation curves followed familiar segment patterns, and the captive finance company's residual was usually within a few points of the honest market projection. EVs broke that.
Three things make EV lease math hard. First, battery technology is improving fast — a 2024 trim with 250 mi range competes with a 2026 trim that gets 320 mi for the same price. That alone caps the resale value of older EVs in a way that doesn't happen with gas cars. Second, price cuts have been violent: Tesla cut Model 3 by $9,000 overnight in Jan 2025, and similar mid-cycle cuts have hit Ioniq 5, Mach-E, and Lucid Air. Anyone who bought just before the cut watches their car's resale value collapse. Third, the federal tax credit story keeps changing — §30D reductions in 2024, full elimination in Sept 2025 — and the captive's residual was set before those changes, sometimes leaving lessees in unusual positions.
When leasing genuinely beats buying
- You're worried about battery longevity. Lease end = somebody else's problem.
- You expect a price cut on your model. Lock in today's residual; walk away if the car loses value faster than expected.
- You drive under your mileage allowance. Excess mile fees ($0.20-$0.30/mi) are punishing if you go over, but if you're well under, you've effectively paid for unused miles.
- You want to upgrade frequently. EV tech moves so fast that a 3-year cycle keeps you on current battery tech and the latest features.
When buying genuinely beats leasing
- You drive a lot. Above 15k mi/year, lease excess-mile fees usually make buying cheaper.
- You want a Tesla. Tesla doesn't lease as aggressively as legacy makers; their residuals are already very high, so lease offers don't have much room to undercut a purchase.
- You'll keep the car 5+ years. Once the loan is paid off, you have a paid-for car with 100% of remaining value as equity. That's the buy advantage.
- You're in a state with high lease sales tax. Texas and a few other states tax a leased car on its full price — eliminating the typical lease tax advantage.
Methodology
The tool above uses depreciation data from our 79-row EV depreciation dataset (42 models; refreshed quarterly from KBB and J.D. Power used values, cross-checked against CarGurus listings). For models not in the database, we fall back to segment averages: ~11%/yr for Tesla, ~14%/yr for mass-market EVs, ~13%/yr for trucks, ~19%/yr for luxury EVs. The implied lease residual is back-calculated from your monthly payment assuming ~72% of payment is depreciation portion (industry-standard estimate). Sales tax handling assumes monthly-payment-only treatment (most common); if your state taxes the full vehicle, the lease cost is understated. On the buy side, sales tax is rolled into the loan and counted once. The purchase price includes the destination charge where our EV database has it on file. Each projection is applied to the price it is published against: a lessor's residual to MSRP plus destination, and used-market depreciation to MSRP alone.
For the 14 models in our lease-residual table, the market projection at 36 months is the lessor's own residual instead: the share of MSRP (including destination) the car is set to be worth after 36 months at 12,000 miles a year, checked monthly. Where the automaker's lease offer prints the purchase price at lease end (Kia, Honda, BMW and Mercedes-Benz), we read the residual from that disclosure. Where it prints none (Tesla, Ford, Chevrolet and Cadillac), we calculate it from the automaker's own online lease quotes: quotes that differ only in down payment give the money factor, and the residual is the figure that reproduces every quote. That covers 11 of the 14; the other 3 are labelled "Estimate" in the tool because the automaker has no current 36-month lease offer for them.
Lease vs buy FAQ
Why is leasing an EV often pitched as a good deal?
For 2022-2025 vehicles, captive finance companies could claim the §45W commercial clean vehicle credit and pass the $7,500 through as a capitalized cost reduction — even if the lessee's income or vehicle didn't qualify for the consumer §30D credit. This was the famous "lease loophole." It closed Sept 30, 2025 under the OBBBA, but pre-existing leases keep their pass-through. For new leases acquired after that date, the math is now apples-to-apples with buying.
How is your residual projection different from the dealer's?
The dealer uses the captive finance company's residual — a number set at lease origination based on its own projection, often conservative (lower) on EVs because finance companies hedge against uncertain depreciation. For most models, our market projection comes from used-market prices instead: the typical price of the same model in Kelley Blue Book and J.D. Power used-car valuations (cross-checked against CarGurus listings), as a share of its original MSRP, refreshed quarterly. When the captive's residual is well above that projection, the lease is a good deal (you walk away before the real depreciation hits); when it's below, you're overpaying. For the 14 models in our lease-residual table, the 36-month projection is the lessor's own residual, read from the automaker's lease-offer disclosure or calculated from its own lease quotes, so you can check the residual on your quote against it; models with no current lessor figure are labelled as estimates.
What's the typical 36-month residual for an EV in 2026?
It varies more by model than by segment. In our lease-residual table (lessor figures checked September 2026, 36 months at 12,000 miles a year, as a share of MSRP including destination), residuals run from 44% (Mercedes-Benz EQE 320+ Sedan) to 65% (Chevrolet Blazer EV LT FWD), with 52% in the middle. Lessors change residuals month to month and trim by trim, so check the residual on your own lease worksheet against the tool's market projection before signing.
Are there hidden lease costs I should watch for?
Yes. Acquisition fee ($595-$995, charged at lease signing). Disposition fee ($350-$595 at lease return — often waived if you lease/buy from the same brand again). Excess mileage fee ($0.20-$0.30/mi after your annual allowance). Excess wear & tear charges (subjective, can be $500-$2,000). Early termination fees if you need out before the term ends — these can be brutal, often equivalent to all remaining payments. The calculator includes the standard fees; verify your specific lease contract.
Does sales tax work the same on lease vs buy?
No, and this is state-dependent. In most states, lease sales tax applies only to the lease payments, not the full vehicle value — which saves money on lease vs buy. In Texas and a handful of other states, tax is charged on the vehicle's full price even on a lease, eliminating that advantage. Check your state's practice before assuming the lease is cheaper from a tax angle.