Demand for vehicle leasing is growing rapidly among Carwow customers, with new data showing lease enquires have risen 44% year-on-year.
The company says lease enquiries as a proportion of all new car leads grew by 325% between 2018 and 2021.
Electric vehicle (EV) demand is accelerating the trend, according to Carwow, which has reported a 200% increase in EV lease enquiries year-on-year and says EVs now make up 38% of all Carwow enquiries.
“Our investment in car leasing is part of a broader strategy to help businesses profit from the digitalisation of motor retail, and establish Carwow as the top online destination for consumers to change their car,” said Carwow’s head of leasing Giorgia Robinson.
“We work with our lease partners to come up with the right formula for converting enquiries into orders, sharing knowledge and data to help each other grow and improve. The momentum we’re building also means our lease function is now seen by more OEMs as a route to enhance volumes and market share.”
Carwow’s lease partners, which include Yes Lease and Zen Auto, have indicated that there was a 50% increase in the proportion of enquiries that converted to a sale.
Vehicles from Volkswagen Group brands were the ones most in demand when it came to lease deals facilitated via Carwow over the past year. Volkswagen topped the ‘most ordered’ chart last year, followed by Skoda, Audi, Nissan and BMW.
EVs also featured very strongly in the rankings of individual models most in demand, with the Tesla Model 3 topping the Carwow lease list in 2021, and the all-electric VW ID3 in fourth place.
Driving an EV on a lease is cheaper than funding one on PCP (personal contract purchase), accroding to research carried out by Leasing.com.
It found that leasing was the most cost-effective option on 13 of the 15 most popular EVs it markets. The highest cost difference was 31% for an Audi E-Tron, with the average difference in cost being 18%.
Vehicle leasing sales via Carwow in Germany, meanwhile, have grown from 7% in 2018 to 17% in 2021, while finance purchases have decreased from 28% to 14% in the same period.
Marketplace director at Carwow Germany, Johannes Gabriel, explains: “Leasing is now the dominant monthly payment type in the private customer segment.
“OEMs are investing heavily in leasing, which is fast becoming the dominant monthly payment type. The shift to EVs has also resulted in consumers worrying about residual value alternatively-fuelled vehicles and their batteries, making leasing a desirable way to minimise financial risk and try new vehicle technologies without concern.”
Auto Trader will accelerate into the car leasing sector after agreeing a deal to acquire Autorama, the parent company of Vanarama.
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