What is a long-term leasing contract?
In addition to buying an electric vehicle, you can also lease one in 3 different ways:
With regard to the latter, this allows you to lease a vehicle for a period of one to 5 years. During this period, the lessee agrees to pay a fixed monthly rental to the lessor or owner, with additional services included in the rental price.
At the end of the contract, the tenant can choose between :
- return the vehicle to the owner
- request a new contract with a different financing method
- renew the contract
- extend the long-term leasing contract
This type of leasing is suitable for both private individuals and companies.
Renewal vs. extension of a leasing contract: what's the difference?
What happens after the end of the contract?
When your contract comes to an end, you have the option of renewing or extending it. But what's the difference between the two?
On the one hand, there's the so-called contract renewal. At the end of the contract, the tenant can ask to sign a new contract with more or less the same conditions as the previous one.
Good to know: each leasing contract is linked to an electric vehicle. So, in the case of a renewal, the new contract implies a new vehicle.
An extension, on the other hand, is when the lessee wishes to extend the duration of the current contract. In this case, a new contract end date is set. This can be done according to established conditions and mutual agreement between the lessee and lessor.
And if you're thinking of renewing your leasing contract, don't hesitate to get in touch with our Beev experts. They'll guide you through the whole process.
Why extend a long-term leasing contract?
In fact, the automotive sector is gradually becoming more fragile, due to successive events: the war in Ukraine, rising fuel prices, thecessation of sales of combustion-powered vehicles by 2035.
Furthermore, with regard to the semiconductor shortagelinked to the health crisis that marked the beginning of the many difficulties the automotive sector has been experiencing to date. As a result, dealers are having to bear the brunt of global shortages.
The global shortage
Many drivers may wonder why the delivery of their electric car is taking so much longer than expected.
To answer this question, we will have to look once again at the consequences of the health crisis:
- the health crisis and containment have brought semiconductor chip production in Taiwan to a screeching halt. To counter this, the European Union wants to relocate part of its production. But this will not be possible before 2025.
- In the first wave of Covid-19, many companies were forced to close their offices and telework. To enable them to work in the best possible conditions, they had to equip themselves with computers and functional telephones. Except that these tools needed electronic chips, the same chips used in electric car batteries.
- as the number of electric vehicle sales has increased, production requires 5 times as many electronic chips.
While demand for vehicles is high, factories are slowing down and automakers are finding it difficult to adapt and speed up production of electric vehicles.
To avoid delivery delays, you can extend your leasing contract. We recommend that you order your electric vehicle now. With Beevyou can send us your request. Our experts will support you every step of the way.
What are the reasons for extending your contract?
As we saw earlier, the fact that many motorists don't receive their electric vehicles on time is due to semiconductor shortages and numerous geopolitical events.
Apart from this problem, there are several reasons why an electric vehicle lessee might wish to extend his or her leasing contract:
- have more time to use the electric vehicle, because you are satisfied with it and want to benefit from it even more
- give yourself a little more time to choose another electric vehicle
How do I extend my long-term leasing contract?
If you are a private individual or a company, extending a leasing contract involves making a few changes to the current contract:
- the new periodicity of the contract
- the new mileage is extended or modified
A number of conditions must be met before you can extend your leasing contract:
- not to exceed the mileage set by the rental company
- do not exceed the 60-month rental period when applying for an extension
When these two conditions are met, the rental price remains unchanged. So you won't need to budget extra at the end of the lease.
A little inexpensive advice: to ensure that your extension goes as smoothly as possible, we recommend that you request it 3 to 4 months before the end date of your contract.
If I can't extend, are there any alternatives?
As we have already seen, there are a number of conditions to be taken into account if you wish to extend your leasing contract.
If the above conditions are not met, there are 2 possibilities:
Returning your electric vehicle
When you choose to lease a vehicle, the principle is to use the asset for a limited period of time, and at the end of the contract to return it to the owner.
In this case, it's essential to prepare the vehicle's return clauses several months (3 to 4 months) in advance, to avoid unpleasant surprises.
As the end date approaches, it is advisable to take note of the return clauses. In addition to this, you should also check the condition of the vehicle.
After that, make an appointment with your Beev to take stock of the vehicle, to see if it's in good condition and still functional.
Medium-term leasing (MTL): another option for leasing an electric vehicle
To cope with the global shortage and delivery times, medium-term rental (MTR ) can be an alternative...
In simple terms, a LMD is a type of lease that allows you to rent an electric vehicle for a renewable period of 1 to 24 months.
This type of financing can be interesting if you want to have an electric vehicle as quickly as possible, while waiting for the delivery of your vehicle.
Renting an electric vehicle through LMD is a way of helping you when you want to change vehicles. A number of services are included in LMD contracts, including :
- maintenance service
- 24/7 medical and technical assistance
- vehicle anti-theft warranty
This means you can drive without worrying about damage to your electric vehicle.
In fact, if you're interested in leasing, Beev has this offer for you, only available to professionals.
In fact, we have electric car models available right now at a price of €590/month:
Find out more : everything you need to know about medium-term electric car leasing.
What are the pitfalls to avoid when extending a leasing contract?
When you sign a long-term leasing contract, there are a number of details you need to take into account:
- Make sure that the mileage set at the signing of the contract is maintained before the end of the contract, otherwise the bill will rise. To avoid this, don't hesitate to determine the type of use for which the vehicle will be used, so that the rental company can provide you with an offer adapted to your needs.
- not thinking about putting the vehicle back in good condition: most electric vehicle owners pay a lot of attention to the condition of the vehicle. If this step is neglected, the lessor could add to the rental bill. So, before returning the vehicle, make sure it is in good condition, as nothing will go unnoticed.
- cleaning is also a detail to consider: in addition to ensuring the vehicle's condition, cleanliness is also important.
- wait until the end of the contract to extend it: we recommend that you contact your rental company 3 months before the end of the contract, so that you can start the process with complete peace of mind.
- make sure you find out all the terms and conditions of the contract before making an extension.
In short, when you extend your leasing contract, you get to enjoy your vehicle for a while longer, while you wait for your electric car to be delivered. What's more, extending your contract means you don't have to deal with problems such as delivery times, shortages of raw materials and production slowdowns.
