Why a monthly rental fee is not a lifetime-cost comparison
Tire rental can spread a large purchase over time and may bundle fitting or maintenance services. A cash purchase can look simpler because the first tire set has one visible price. Neither headline number tells the full story when the vehicle will need another set, the contract includes only a limited number of sets, or care, damage, disposal, deposits, and end charges sit outside the advertised price.
This calculator places both alternatives on the same month-by-month timeline. It estimates the required set schedule from mileage and age, builds rental and purchase cash flows, applies an editable cost-escalation assumption, and then reports both nominal lifetime cost and discounted present-value lifetime cost. It also converts present value to an equivalent monthly cost and cost per planned kilometre.
Every default is a fictional planning example. It is not a quoted Korean tire price, a recommended replacement interval, an expected return, or a legal interpretation of a rental contract. Replace the defaults with the written contract, a like-for-like purchase quote, and a replacement plan appropriate for the exact tires and vehicle.
Five questions the model can answer
- How many tire sets begin during the selected mileage and time horizon?
- What are rental and purchase nominal cost, present value, and equivalent monthly cost?
- How much can uncovered replacement sets add after the rental allowance is exhausted?
- What monthly rental fee or cash set price would make the two present values equal?
- Does the ranking change when annual mileage is 30 percent lower or higher?
Start with matching tires and matching scope
A comparison is meaningful only when both quotes cover the same tire count, size, load index, speed rating, season, and intended use. One quote may bundle fitting, balancing, valves, alignment, rotation, puncture response, roadside service, damage cover, storage, delivery, or disposal while the other lists those items separately. Record the real out-of-pocket cost on each side rather than giving both sides an assumed service value.
Product and fitting checklist
- Same size, specification, quantity, and comparable product grade
- VAT, fitting, balancing, valves, and wheel weights
- Alignment and rotation frequency rather than a vague service label
- TPMS work, run-flat handling, delivery, and mobile fitting charges
- Old-tire disposal, seasonal storage, and emergency response
Contract and protection checklist
- Total payment months and the first and last payment dates
- Number of included sets and the charge for an uncovered set
- Puncture, sidewall, uneven wear, and user-fault exclusions
- Deposit refund, ownership, return, renewal, and early termination terms
- Whether displayed prices include VAT and mandatory enrollment charges
Do not invent a value for an included service
If the rental contract includes alignment but the purchase plan would not use alignment, do not add an imaginary alignment bill to the purchase side. Enter only the costs that you realistically expect to pay. If a service is advertised as included but has a deductible, visit limit, exclusion, or travel charge, enter the expected excluded amount on the rental side.
How to prepare the common planning inputs
Tire count and analysis horizon
Use the same tire count for both alternatives. The analysis horizon is the number of months from now until the planned sale, lease return, or end of the comparison. It is separate from the rental payment period, so a 36-month contract can still be examined over a 60-month vehicle plan when the later tire costs are entered consistently.
Annual mileage and planned replacement mileage
Use a recent odometer-based annual distance or a defensible future plan. Planned replacement mileage is a budgeting assumption, not an automatic safety threshold. Review the tire maker material, actual tread and damage, vehicle guidance, road conditions, loading, pressure history, and a qualified inspection before deciding whether a tire remains usable.
Maximum planned age
The age input is the longest planning interval you are willing to use even if mileage remains low. The model chooses whichever arrives first: the mileage-derived month or this age month. It does not infer manufacturing date, storage history, rubber condition, cracks, impact damage, or tread depth.
Discount rate and cost escalation
The annual discount rate converts future cash flows to today's value. The annual escalation rate grows future set, fitting, care, damage, and disposal costs from their current quote. These are user assumptions, not forecasts. Test more than one pair if the decision changes with a small rate adjustment.
Rental-side inputs
Enter the contract as cash flows rather than treating every charge as part of the monthly fee. This keeps a refundable deposit different from a nonrefundable enrollment charge and keeps an uncovered replacement set different from an included set.
Rental contract inputs and evidence to check| Input | What to enter | Evidence |
|---|
| Monthly fee and payment months | The actual recurring amount and count, not the analysis horizon | Application, quotation, and payment schedule |
| Initial fee | Enrollment, delivery, fitting, or other nonrefundable start cost | Itemized first invoice |
| Deposit and refund rate | Amount paid now and the share expected back at the payment end | Refund conditions and deduction clauses |
| Included sets | Total whole-vehicle sets included across the entered payment plan | Contract wording for quantity and eligibility |
| Extra-set cost | Your contractual cost for each required set beyond the allowance | Replacement-price clause or separate written quote |
| Annual exclusions and damage | Expected annual out-of-pocket care and damage outside coverage | Service limits, deductible, exclusions, and your history |
| End cost | Expected return, collection, purchase, restoration, or termination settlement | End-of-contract and ownership terms |
Purchase-side inputs
Set price and fitting per set
Set price is the current cash price for all entered tires. Fitting per set repeats whenever a set begins and can include balancing, valves, and other mandatory work. Keep optional alignment or rotation in annual care when that better matches the service plan.
Annual care and expected damage
Annual care can cover planned rotation, pressure service, seasonal storage, or alignment that you expect to buy. Expected damage is a budget reserve for puncture or sidewall events after considering insurance and warranty. It is not a prediction of a specific event.
Disposal per replacement
Disposal is charged only when an old set is replaced during the horizon, not when the initial set begins at month zero. Enter zero when disposal is demonstrably included in fitting.
End residual value
Residual value reduces purchase cost only at the end of the horizon. Leave it at zero unless a buyer, unused-tread plan, transferable warranty, or other documented recovery supports a value. The calculator caps the credit so it cannot reduce total purchase cost below zero.
Replacement schedule formula
The model first converts annual mileage and planned replacement mileage to a mileage-based life in months. It then compares that value with maximum planned age. The smaller value becomes the effective interval. One set starts at month zero, and another set starts at each interval strictly before the analysis end.
total distance = annual mileage × analysis months ÷ 12
mileage life months = replacement mileage ÷ annual mileage × 12
effective life months = min(mileage life months, maximum age months)
set months = 0, life, 2 × life, ... while set month < analysis months
If a replacement month equals the analysis end exactly, the model does not add a set that would begin after the vehicle is sold or returned. When annual mileage is zero, the age interval remains active. This schedule is a budgeting convention and never overrides an inspection or the exact manufacturer advice.
Cash-flow, escalation, and present-value formulas
Rental payments occur from month one through the entered payment count. Initial fee and deposit occur at month zero. The refundable share returns at the payment end. Uncovered rental sets and all purchase sets are placed on their scheduled months. Annual care and expected damage are spread monthly so a partial final year is handled proportionally.
Cost escalation
escalated cost at month m = current quote × (1 + annual escalation)m ÷ 12
Present value
present value at month m = cash flow at month m ÷ (1 + annual discount rate)m ÷ 12
Comparable outputs
nominal TCO = sum of nominal monthly cash flows
present-value TCO = sum of discounted monthly cash flows
equivalent monthly cost = present-value TCO ÷ annuity factor
present-value cost per km = present-value TCO ÷ total planned distance
Worked 60-month example
The default demonstration uses four tires, 60 analysis months, 15,000 km of annual mileage, a 45,000 km planned replacement distance, and a 60-month maximum age. The mileage interval arrives first at 36 months, so sets begin at month 0 and month 36. Total planned distance is 75,000 km. The discount assumption is 3 percent and the cost-escalation assumption is 2 percent.
Default tire rental and purchase lifetime-cost result| Measure | Rental | Purchase | Interpretation |
|---|
| Nominal lifetime cost | KRW 3,226,025 | KRW 2,928,361 | Undiscounted cash-flow sum |
| Present-value lifetime cost | KRW 2,994,667 | KRW 2,769,068 | Purchase is lower by KRW 225,599 |
| Equivalent monthly cost | KRW 53,756 | KRW 49,707 | Same discount basis for both alternatives |
| Present-value cost per km | KRW 39.93 | KRW 36.92 | Based on 75,000 km |
| Break-even quote | KRW 40,950 per month | KRW 914,450 per set | Other entered assumptions stay fixed |
The example is a test vector, not a recommendation
The KRW 45,000 monthly rental, KRW 800,000 purchase set, two included sets, and all care and damage amounts are synthetic inputs used to verify the arithmetic. They do not describe a market average. Under only these inputs, the purchase path remains cumulatively lower from month 53 through month 60.
How to read break-even values
Break-even monthly rental fee
This is the recurring rental fee that makes rental present value equal to purchase present value while payment months, deposit, included sets, and every other input remain fixed. A quoted fee below the threshold does not guarantee rental is better if contract scope or end charges also change.
Break-even purchase set price
This is the current cash set price that makes purchase present value equal to rental present value while fitting, repeated sets, care, disposal, and residual value remain fixed. Compare it with a tax-inclusive written quote covering the same tire specification.
A missing break-even result means the variable alone cannot produce a nonnegative equality under the entered structure. It does not mean that one alternative wins under every possible contract. Change the actual disputed assumption, such as included-set count or end cost, and review the full result.
Mileage sensitivity and the third-set cliff
The calculator reruns annual mileage at 70 percent, 100 percent, and 130 percent of the entered value. All prices, payment months, and age assumptions remain unchanged. This exposes discontinuities where a small mileage change brings an additional set inside the horizon.
Mileage sensitivity for the default worked example| Scenario | Annual mileage | Set months | Rental PV | Purchase PV |
|---|
| 70 percent | 10,500 km | 0 | Lower than base | Lower than base |
| 100 percent | 15,000 km | 0, 36 | KRW 2,994,667 | KRW 2,769,068 |
| 130 percent | 19,500 km | 0, 28, 56 | KRW 3,759,061 | KRW 3,653,951 |
In the high-mileage row, a third set starts at month 56. If the rental includes only two sets, the uncovered-set charge becomes important. The model does not assume the rental provider will authorize that replacement at the exact planning month; eligibility remains a contract and inspection question.
A reliable step-by-step workflow
- Fix one tire scope: record size, product, tire count, tax, fitting, and service coverage for both quotes.
- Choose the vehicle horizon: enter the real months until sale or return and a realistic annual distance.
- Set a planning interval: use both mileage and age assumptions, then inspect the generated set months.
- Transcribe the rental: separate monthly payments, initial fee, deposit, included sets, exclusions, and end cost.
- Build the purchase plan: add each set, fitting, annual care, expected damage, disposal, and documented residual value.
- Challenge the result: review cash-flow components, break-even quotes, crossover month, warnings, and mileage sensitivity.
- Save the evidence: keep dated quotations and contract pages with the assumptions used for the decision.
Practical use cases
Low-mileage private vehicle
The maximum-age assumption may arrive before the mileage target. Compare the convenience bundle with the deposit, payment period, and unused service allowance instead of assuming low mileage always makes rental cheaper.
High-mileage commute or business use
More sets can enter the same horizon. Confirm the rental replacement eligibility, extra-set price, appointment downtime, and whether commercial use is excluded before relying on the included-set count.
Vehicle sale before contract end
Use the actual planned ownership horizon but keep every payment and termination settlement required by the contract. Do not silently shorten payment months merely because the vehicle may be sold earlier.
Fleet with several vehicles
Run one vehicle profile at a time when sizes, mileage, or contracts differ. Multiply only after confirming the same schedule and service exclusions. Fleet downtime and administrative convenience are not automatic savings.
South Korea safety boundary checked for 2026
There is no universal legal replacement mileage in this model
The current official text of Article 12 of the Rules on the Performance and Standards of Motor Vehicles and Parts was checked through the National Law Information Center. The record effective July 10, 2026 requires pneumatic tires to meet the applicable standard and states that tires and running gear must not have cracks or damage. It does not supply one universal replacement kilometre or month value for this calculator.
Article 80 of the Enforcement Rule of the Automobile Management Act, in the official current record effective June 3, 2026, includes running gear within vehicle inspection suitability. The calculator cannot inspect tread, damage, pressure, alignment, manufacturing date, load, or road exposure. Replace a tire when a qualified safety assessment or the applicable product and vehicle guidance requires it, even if the budget schedule shows a later month.
Contract and cancellation boundary
A product called tire rental can have different legal and commercial structures. The calculator does not classify a particular agreement as an installment transaction, continuing transaction, lease, service membership, or sale. It also does not assume a universal free-cancellation period or penalty cap.
Installment Transactions Act
The current official Articles 2, 5, and 6 describe installment-transaction scope and written disclosures such as cash price, installment price, payment count and timing, and actual annual rate. Applicability depends on the substance and terms of the specific agreement, not the calculator label.
Door-to-Door Sales Act
The current official continuing-transaction provisions include definitions, information duties, termination, penalty, and refund rules in Articles 2, 30, 31, and 32. Not every tire rental necessarily meets that definition. Check the signed term, supply method, cancellation clause, and actual facts.
Enter the likely settlement, then obtain advice when needed
Put the contract's expected end or termination amount in the end-cost input. If validity, classification, unfair terms, cancellation rights, or a dispute matters, obtain the full written agreement and seek guidance from the competent consumer body or a qualified professional. The output is a budgeting scenario, not legal advice.
Tips, warnings, and model limits
Improve the evidence
- Ask for a tax-inclusive total and itemized exclusions.
- Use current odometer history instead of a rounded guess.
- Record whether replacement eligibility is mileage, condition, or approval based.
- Run discount and escalation assumptions above and below the base.
- Keep deposit refund and residual value conservative until documented.
What the model does not price automatically
- Credit risk, tax deductions, insurance changes, or financing fees
- Brand preference, wet braking, noise, efficiency, or ride quality
- Unexpected wheel or suspension repair and severe accident damage
- Appointment availability, downtime, or administrative convenience
- Future regulation, product discontinuation, or provider solvency
The present-value method follows the general life-cycle-cost principle of comparing alternatives over a common period and discounting time-separated costs. NIST Handbook 135e2022 is cited as a methodological reference, not as a Korean tire-price or contract source.
Frequently asked questions
Is tire rental cheaper than buying?
Not automatically. Rental can be lower when the fee, included sets, and service value fit the actual plan. Purchase can be lower when the vehicle needs few sets or the rental carries long payments, exclusions, deposits, or end charges. Enter both written offers to answer the question.
Should payment months equal analysis months?
Only when the real contract and vehicle plan have the same duration. Keep them separate when payments stop earlier, continue after a planned sale, or a renewal and later replacement have distinct terms.
What if the rental includes unlimited replacements?
Read the eligibility and authorization language first. If every required whole-vehicle set in the planning horizon is genuinely included, enter an included-set count at least as large as the generated requirement. Do not treat repair-only, condition-based, or approval-limited coverage as an unconditional set allowance.
Does the replacement schedule tell me when a tire is unsafe?
No. It is only a budgeting interval. Tread condition, cracks, impact damage, pressure loss, loading, alignment, age, and product guidance require real inspection. Safety action can be necessary before the modelled month.
How should I enter a refundable deposit?
Enter the amount paid at the start and the realistically refundable percentage. The model records the refund at the payment end, so even a 100 percent refund can carry a present-value cost while the money is tied up.
Is the cheaper present value always the right choice?
No. Product performance, safety, service access, contract risk, liquidity, convenience, and preference may matter outside the monetized inputs. Use the result to identify the assumptions worth verifying, not as an automatic purchase command.
Official sources and review date
Official current-history law records were checked on August 6, 2026. They are used to define safety and contract boundaries only. They do not supply the calculator's fictional prices, replacement intervals, discount rate, or escalation rate.
Replace every example with the actual contract and quote
Begin with matching tires, enter the real payment and replacement terms, and confirm the generated set schedule. Then read present value, components, break-even quotes, crossover month, and mileage sensitivity together before deciding which assumption needs stronger evidence.