Toyota recently added the new Vitz to its Kinto subscription service, letting motorists use the vehicle for extended periods without ever purchasing it.
The company is currently running an introductory promotion on the hatchback for individuals to take home the base 1.0 MT model for R2,999 per month for a duration of 12 months or 18,000km (1,500km per month).
The contract includes warranty, service, and maintenance costs, as well as 24-hour roadside assistance and stolen vehicle recovery.
It also includes the initial licence and registration cost, as well as Connected Car services like in-car WiFi and Telematics.
As a reminder, the Vitz is Toyota’s new entry-level car, brought in to replace the Agya, with a starting price of R189,900.
It’s therefore worth asking whether or not you should actually consider buying the car instead, depending on what the cost of an instalment plan would be vs leasing it.
Leasing vs buying
We can use the following formula to work out how much it would realistically cost to purchase the Toyota Vitz on a finance plan over the same 1-year lease period:
- Car price – R189,900
- Payment term – 12 terms (1 year)
- Interest – 11.75%
- Deposit – 0%
- Balloon – No balloon payment
- Extras – No optional extras
According to this, buying the Toyota Vitz on a payment plan will require an instalment of R17,026 per month.
Even if we adjust the duration to 72 months (six years), which is the longest period that most banks will agree to, motorists would still need to pay R3,780 per month while also incurring R81,080 in interest over the course of the plan.
Therefore, the new lease option is clearly the cheaper and easier route for those who are looking for a set of wheels they can use for an extended time, though it should be noted that this comes with the downside that you are limited in terms of how far you can drive every month, and you naturally won’t be able to keep or sell the vehicle at the end of the contract.
Keyword: Buying vs Leasing the cheapest Toyota in South Africa