Car Plans in Switzerland: When Do Long-Term Rentals Make Sense?

Not everyone needs a car for a long term. For example, if you only really use a car during the summer months, you may wonder whether buying or leasing a car makes sense for you. Some people do not want the risk of buying or leasing a car that might have problems. Others do not want the hassle of servicing, repairs, and dealing with insurance and taxes.

Car plans can provide an alternative. This moneyland.ch guide answers the most important questions about car plans, and about when using a car plan can make financial sense.

What is a car plan?

A car plan is a long-term car rental agreement. Instead of buying a car or borrowing a car from a leasing company, you simply rent the car as you would with short-term car rentals.

How is a car plan different from leasing a car?

Typically, when you lease a car, you have to take care of getting car insurance, servicing and repairing the car, and paying road taxes. 

With a car plan, on the other hand, all the basic costs are accounted for in the monthly rent. You only pay incidental costs like fuel, parking, tolls, and fines, as you would with any rental car.

How is a car plan different from a normal car rental?

The main differences are:

• A car plan is normally an ongoing contract that must be terminated upon request. With a standard car rental, on the other hand, the rental ends automatically at the end of the rental term when you return the car.
• The minimum term for a car plan is normally at least one month. The minimum term for a standard car rental, on the other hand, is typically one day.
• The per-day cost is typically much lower with a car plan than with a standard car rental, though this is not always the case.

Which costs are covered by the flat fee?

The rent you pay generally covers these costs:

• The use of the car.
• Repairs and maintenance, including tires.
• Fully-comprehensive car insurance. Basic roadside assistance cover is typically included. You may be able to choose between several deductible and coverage options. As a general rule, the lower the deductible you choose, the higher your monthly rent will be.
• Swiss road taxes.
• Registration and license plate fees.
• Swiss highway taxes. There are car plan providers that only cover this cost for the year in which the contract begins.

Depending on the service provider, some other costs may also be covered. For example, Clyde offers an optional supplement that includes compensation for the cost of charging electric vehicles.

How long is the rental term?

The minimum rental term for one car ranges between one month and three months, depending on the car plan provider. You have the option of choosing terms as long as 12, 24, 36, or even 48 months. As a general rule, the longer the rental term, the lower the monthly rent is.

Important: After the minimum rental term you agreed to ends, the rental agreement will be automatically extended month by month. If you want to end the subscription, you have to give notice. Depending on the car plan provider, this can be done by mail or online, for example.

Are there limits on mileage?

Yes. As with leasing, car plans have monthly limits on how far you can drive with the car. Typically, you can choose between several different mileage options. The more mileage you want, the higher the monthly rent will be.

Car plan providers generally balance the mileage across the full rental term. As long as the average mileage across the full mileage term does not exceed your allowance, you will not be charged extra. If your total mileage exceeds your allowance, you will normally be charged an additional fee based on how many extra kilometers you drove.

Where can I get a car plan in Switzerland?

There are a number of Swiss car plan providers. The table below provides a basic overview.

When does using a car plan make sense?

There are a number of situations in which getting a car plan can be a good solution:

• You only need a car for a relatively short period of time – several weeks or months, for example. In this case, using a car plan is much more convenient and less risky than buying a car and reselling it after several months. The minimum term for leasing a car is typically two years.
• Your needs with regard to the size and type of car change fairly frequently. For example, if you need a small car or a four-wheel drive during the colder months, and a van or camper during the warmer months. A car plan gives you the flexibility to use different cars as your needs change.
• You want to have the security of being able to plan your budget in advance. With a car plan, you know exactly how much you will spend on the car. When you buy or lease a car, there is always a risk of unexpected costs due to major breakdowns, and you cannot be certain of the resale price or residual value until you give up the car.

Is using a car plan more expensive than leasing or buying?

In most cases, using a car plan is more expensive than buying or leasing a car. However, a direct comparison is impossible because there are many unpredictable factors that apply to buying and leasing.

It is worth noting that if you buy a car using a personal loan, rather than savings, the total cost will be higher due to the interest paid on the loan. You can find more information in the guide to financing a car in Switzerland.

Do I have to make a down payment?

Some Swiss car plan providers give you the option of making a down payment. The bigger the down payment, the lower the monthly rent. However, there is no obligation to make a downpayment.

How often can I exchange the car?

When the rental contract term expires, you can rent a car again if you choose to, or you can terminate the plan by giving the necessary notice.

Can I drive the car outside of Switzerland?

You can generally drive the car in EFTA and EU countries, as well as the UK, Andorra, Monaco, San Marino, and Vatican City. If you plan to drive to other European and non-European countries, it is important to check the car plan providers terms and conditions of your car plan before driving to other countries.

What are the requirements for getting a Swiss car plan?

In order to subscribe to a Swiss car plan, you have to be a legal resident of Switzerland. Car plan providers may check your credit score before accepting you as a customer. Some have minimum age requirements, or a minimum period since you obtained your drivers license.

How does the pick up and return process work?

You must collect the car at the car plan provider’s depot, or at a specific partner garage or showroom. When comparing offers, make sure to check where cars are located and account for the time and cost of collecting and returning the car.

Normally, you have the option of having the car delivered to you for a fee. Some car plan providers will also pick up the car at the end of the term for an extra fee.

Will I get a license plate from my canton?

Unlike standard short-term rental cars, which are usually licensed in a canton with low road taxes, cars you get with car plans will generally be licensed in your home canton. However, there are some car plan providers that do not offer this service as standard, but as a supplemental option with an extra fee.

How do servicing and repairs work?

The car plan provider will inform you about an authorized garage near you which you must visit for maintenance and repairs. If you have a breakdown while driving, you can use the roadside assistance service included in your plan.

Are there any additional costs I should be aware of?

The flat fee covers all of the basic, ongoing costs that are directly associated with the car itself. But there are a number of additional fees that can apply in some cases, all of which can be avoided if you are careful. These incidental fees include:

• Late payment reminder fees when you do not pay your bill on time.
• Fees for deep cleaning if you return the car in a very dirty condition (unremoved animal hair or tobacco residues, for example).
• Fees for processing road traffic fines.
• Fees for terminating your contract ahead of schedule.

Third-party costs, like road traffic fines and parking tickets, will also be passed on to you, as is the case with rental cars in general.

Do car plan providers have customer loyalty programs? (Hertz rewards, Credit card payment possible at some service providers)

Some car plan providers have loyalty programs that reward you for your rentals. For example, when you get a Hertz Minilease car plan, you earn Hertz reward points just as you would with standard car rentals.

A few car plan providers let you pay the monthly flat fee using a credit card. This lets you earn credit card rewards such as cash back or miles for your car plan payments.

How do I terminate a car plan?

You can terminate a car plan at the end of the pre-agreed contract term. With most providers, you have to give the required notice before the contract term ends. If you do not, the contract is automatically renewed – typically for another one month. 

Typically, you must give notice at least two weeks before the end of the contract term. The exact required notice periods vary between car plan providers.

More on this topic:
Compare Swiss car insurance offers now
Buying a car: Should I get a loan or a lease?
Tips for buying a car in Switzerland
Tips for saving on car rentals