Car sharing, leasing or buying outright?

From car-sharing to buying outright, we explore different types of vehicle ownership and usership.

In the modern world, transport is under scrutiny like never before. With discussions both economic and environmental, more people are second-guessing their own personal transport needs. Nowadays, there are multiple ways to own a car and many people are opting for cheaper and more flexible options (like car sharing.)

To find what works for you, we discuss each type of car ownership, from owning a car outright to the newer concepts of car subscription and, of course, car sharing.

Buying Outright

The most traditional form of car ownership divides into two categories. The first, buying in full, has existed since cars were invented and the second, car finance, followed not long after. Without delving into the obvious, a benefit for buying a car outright is that most dealerships will give a discretionary discount, meaning you get a better price overall for the same car. Of course, sourcing such a lump sum is easier said than done.

Car finance, therefore, is more appealing to those who don’t have thousands of pounds immediately available but it can be a risky game. The monthly payments may seem cheap for a car, but customers who have to pay over several years will end up paying well over the car’s original value. Furthermore, if you have a car accident with finance outstanding you could be in trouble. Trolls under this particular bridge include dealing with outstanding finance after insurance pay-outs (for example, in the event of a vehicle write-off) and additional insurance premiums.

Both ownership options suffer from two further drawbacks. Firstly, you also have the running costs of the car to deal with: maintenance, fuel, insurance etc. at a typical annual cost of £5000. Given cars are idle for 96% of their lives this is a lot of money down the proverbial fuel tank. Secondly, both options suffer from the effects of depreciation; this particularly affects those with car financing, as you are paying the value of the car when it was new rather than its current value. If your finance stretches over three years, you are paying over full price for a car which may have lost up to 75% of its value.

If you are set on owning a car, it may be worth exploring second-hand options, where depreciation works in your favour!


Leasing is a rung above car ownership on the ladder of flexibility, with people paying fixed monthly payments over a term of 2-3 years. Unlike car financing however, you don’t own the car and give it back at the end of the term.

There are some real positives to leasing, most notably that you don’t have to commit to paying off the full price of the car and thus don’t suffer the impact of depreciation. Furthermore, you can get a brand-new car with each renewal, and new cars are generally more efficient, cheaper to run and come with constantly improved tech. The increased flexibility is very desirable; it’s less expensive, month-to-month than financing, and after your term has ended you can simply give back the car with no added worries.

However, leasing does come with its own issues. You are still paying for the times you don’t use the car (96% of the time on average) as well as the annual running costs. And despite an increase in flexibility, you are still locked in for the full term of the lease even if you no longer need a car. Of course, you can terminate the lease early but this carries an early termination fee which for some funders can be 50% of outstanding rentals.

This is why Karshare has partnered with global car leasing firm Leasys to create Lease and Share,enabling consumers to choose a leasing agreement which permits them to hire out their car to vetted drivers in their communities. This industry-first arrangement unlocks earning potential for millions of people and helps Karshare in our mission to build a more sustainable, shared future. Choosing to lease a new car with Lease and Share makes it possible for car owners to earn up to £550 a month within their communities.

One further subsection of leasing is Personal Contract Purchasing which is more complex and known for hidden fees, high interest rates (4-7% APR) and the need to return the car in ‘saleable standard’. This standard is determined by the dealership and you may be charged penalties, even for what you consider ‘wear and tear’.

Car subscription

Car subscription is a modernised version of leasing with even more flexibility. It has been described as ‘Netflix for cars’, with a single payment every month that covers insurance, maintenance and the car itself. With the only ‘extra’ you pay being fuel, this massively reduces the hassle of car ownership. More car manufacturers are entering this space, with Porsche, Cadillac, Ford and Volvo all announcing their own subscription services, alongside new entrants like Lynk and Co.

Subscription has some benefits that reflect modern car users; you are not locked into a contract and can cancel at any time, with the hassle of car ownership passed back onto the provider. With Porsche’s service, the Porsche Passport,  you can even swap car models anytime, making it possible to drive a 4x4 for the school run and a sports car at the weekend.

Unfortunately, subscription services are new and manufacturers are only testing the waters. Most services are not yet widely available and carry a high cost – the Porsche Passport for example, is currently only available in the US and costs between $2000-$3000 a month.

Even as subscriptions go mainstream, monthly payments are still expected to be much higher than leasing, given you are paying for more of a service. How affordable these will be is unclear for the moment, and don’t forget that even within the month-to-month option of cancellation, you are still paying for the 700 hours a month the car isn’t used!

Car sharing

At the top of the flexibility ladder you’ll find car sharing. With two sets of people involved (owners and renters) there are thus two sides of benefits. For renters, these benefits are numerous. Insurance and maintenance are all included in the price you pay, so it’s convenient, hassle free and ensures no leakage of money (like other options.) With keyless tech being introduced across manufacturers, access and ease of use is no longer a barrier.

For owners, car sharing presents a useful stream of secondary income and given that owners don’t need to physically be there to hand over keys or process any administration, it’s as stress-free as passive income gets.

A further benefit is that car sharing will reduce the number of cars, with an estimated 10 to 14 private vehicles taken off the roads for each shared vehicle in urban areas. So not only is it good for your wallet, it’s good for the environment as well.

At Karshare, our innovative airport service allows owners the ability to generate a secondary income on holiday by renting their cars when away, whilst renters enjoy car hire at up to 60% cheaper.

It’s important that car sharing be delivered via a trusted provider so that owners are protected against their cars being driven badly, and renters are protected against owners failing to deliver the required vehicle.

With Karshare, telematics systems are installed in each vehicle to monitor how renters drive them, and owners’ cars are fully covered for any eventualities by our insurance partners (leaving their own insurance unaffected.)

With us, car sharing is now as convenient as ownership as you can book a car and use it exactly when you need it, there and then in your own neighbourhood.


As leasing companies look to subscription models as a modern option for car ownership, we hope subscription in turn will recognise the power car sharing can have for local communities, where the majority of people could thrive on the opportunity’s car sharing provides. As the sharing economy gains traction in sector after sector, we contribute to this growth by bringing car sharing to the mix.