Car Lease vs Buy: Does Leasing Make Sense?

In India, buying with a loan is still the default. But salary-structured car leases (often via an employer) and monthly car subscriptions are a real alternative for some buyers - here's the actual trade-off.

The core trade-off

With a lease or subscription, you pay for the use of the car over a fixed period - typically bundled with insurance and maintenance - and hand it back at the end. With a loan, you pay EMIs on the full price and keep the car (and its resale value) once the loan is closed. Lower monthly outgo now versus an owned asset later - that's the entire decision.

A working comparison: ₹12 lakh car over 3 years

	Lease / Subscription	Buy (60-mo loan)
Monthly outgo	~₹22,000 (incl. insurance & service)	~₹25,500 (EMI only)
Paid over 3 years	₹7.9 lakh	₹9.2 lakh + insurance/service separately
You own at the end	Nothing - return the car	Car worth roughly ₹6.5-7 lakh

Illustrative only - actual lease/subscription pricing and loan rates vary widely by provider, city, and credit profile.

Once you account for the resale value you keep, buying tends to cost less over the medium-to-long term - but only if you hold the car well past the loan tenure and don't mind the maintenance and insurance running as separate, variable bills.

When leasing or subscribing makes sense

• You want a new car every 2-3 years without dealing with resale.
• You value a bundled, predictable monthly cost - insurance and scheduled service included.
• Your employer offers a salary-structured car lease with tax benefits, which can meaningfully change the math.
• You're testing whether you actually need a car long-term (relocations, short-term postings).

When buying makes more sense

• You typically keep cars 5+ years - the longer you hold, the more buying wins.
• You drive high annual mileage, where lease/subscription km caps get expensive fast.
• You want an asset you can sell, modify, or hand down whenever you choose.

Lease or subscribe for flexibility and a bundled bill. Buy if you plan to keep the car long enough for the resale value to matter.