OWNING VS. SUBSCRIBING TO A CONTINENTAL CAR

Continental cars are popular for their style, luxury and reliability but owning one may be a little out of reach in Singapore. The high upfront cost and other costly fees such as increased road tax and maintenance costs can put off many, especially if you’re someone who has other financial commitments to prioritise. 

So, what options do you have if you want or need to drive a continental car but can’t afford or don’t want to fork out huge sums for the initial costs? An alternative would be car subscriptions. It is similar to subscription services like Netflix and Spotify – you get access to a fleet of vehicles for a monthly fee. 

But the question remains, is subscribing to a continental car a better option to owning it? While the battle of the price will be a huge factor in deciding which option is better for you, is it the only difference?

TL;DR

• If you want the ability to customize your car, are absolutely sure that you wouldn’t be changing cars over the period of it’s COE, and can afford the huge down payment – then owning a continental car may be for you
• If you need to save your capital for a house or wedding, want the ability to change cars monthly with no additional costs – then subscribing could be for you

Owning a Continental Car

Advantages

Maybe you’ve always wanted a matte black Mercedes E250 Coupe with sports seats and an electric sunroof. If you want the ability to choose options and modify your car in the future, then owning is probably the right choice for you. We heard vinyl wraps are getting more popular these days…

A hidden perk that you might get with purchasing a luxury continental car is the access to the brand’s car club. These clubs often hold events where you get to meet like-minded drivers and can even be a good opportunity to network. Some of these clubs even grant vouchers for food and car accessories to their members. Notable examples include: Porsche Club Singapore and BMW Car Club Singapore

Disadvantages

The biggest disadvantage of buying and owning a continental car has to be its cost. For just an entry-level continental car, the upfront costs include at least $60,000 for the down payment, more than $1,300 for the monthly loan, and more than $600 a year for road tax. There will also be maintenance costs after your warranty period or if you accidentally damage your car. And we haven’t even taken into account the day-to-day expenses like petrol consumption, parking and ERP, which would likely add up to more than $250 a month.

Not only are you constantly having to pay to own that nice continental car, but you are holding onto a constantly depreciating asset. Any continental car that you buy would be depreciating from a rate of $11,000 a year. So, if you decide to sell the car before 5 years, brace yourself to lose a large chunk of what you paid for.

In short, purchasing a continental car costs a ton of money to own and upkeep. If you’re saving up for something important like a home, wedding or a child, it might not be the best option for you. 

Subscribing to a Continental Car

Advantages

The main benefit you get from a car subscription is financial flexibility. If you need to save up for important milestones like buying a house or a wedding, car subscriptions allow you to manage your finances better. For first-time car buyers, a car subscription is a good option because it requires lower commitment. By subscribing to a car, you can definitely do much more with the money you spend on purchasing a continental car. 

In contrast to purchasing a continental car, there will be no colossal upfront costs that you have to shoulder. Additionally, you don’t have to deal with the unexpected costs surrounding the upkeep of the car, like a flat tire or a minor dent as maintenance is included in your monthly fee. For those who drive the car only for a short period every day, you’ll get to enjoy higher savings of up to $800 per annum due to the pay-as-you-drive model.

Car subscription also eliminates the depreciating liability aspect of owning a car. It is an option that you should seriously consider if you think that you would be selling or changing your car before the COE expires. In another scenario where you decide that you don’t want a car after a short one to two years of driving, you can simply stop subscribing.

Currently, you can subscribe to a brand new Mercedes-Benz A200 Progressive Saloon under the new CARRO LEAP subscription plan. There’s no hefty down payment you’d have to make – the upfront cost is only $1,000 to drive the continental car away. And if you are looking at second-hand continental cars to subscribe to, we can also cater to your needs!

Disadvantages

Under a car subscription plan, you will have your car mileage capped at 18,000km per year. Any additional mileage can be charged from $0.10 to $0.16 per kilometer. This likely won’t affect you unless you drive more than 3 or 4 hours a day. If you think that you need more, you can opt for a 25,000km per year package. Plan ahead if you think you’ll need the extra miles and opt for the 25,000km package.

To the minority that enjoys modifying your cars, unfortunately, you won’t be able to customize the car that you have. That means you can’t change the rims or change the exhaust or add interior LED lighting. On the upside, you do get to choose the colour of the brand new car. So, for those who only want a car to drive, this shouldn’t really affect you.

Also, you can’t sublease the vehicle or use it for private-hire driving. If you are looking at driving the car beyond West Malaysia, you will need to purchase additional insurance at your own costs.

What should you do?

By buying a car, there are many hidden fees. When you are paying for your car loan, you are actually paying more for the interest on the loan. Additionally, you are also losing money every month because of the depreciation of the car! You’ll be continuously losing money because of the depreciation.  Also, you’ll have to pay another large down payment when you want to buy a new car. Is this really worth it just for the few benefits?

With subscriptions, you don’t get to customize your car to the exact specifications or choose the exact model you want. But, you’re most probably saving money as compared to buying a car! Also, you do get some cool benefits that you can’t get by buying a car such as changing your car every month.

So, is subscribing to a continental car better than owning one? Well, the experience isn’t exactly better. It really depends on whether you have enough disposable income to own a continental car. Subscriptions are definitely a good option for those who are more frugal but want a continental car. Subscriptions are worth a try if you’re not entirely sure which option is best for you.  

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