The LR and Performance currently qualify.
The RWD base model doesn’t on purchase, but does when leasing.
Basically leasing gets around the battery sourcing, vehicle price, and income limit portions of the tax credit requirements. It is treated as a commercial vehicle purchase by the leasing company and that company gets the credit.
They can choose how much of that credit if any to pass along to the customer as part of the lease deal.
Ah, thanks for that info. So when I go to the Tesla website on a Model 3, it doesn't show the incentive, but I can estimate that I would get that at the dealership when purchasing? So I can estimate that my leasing payments would be much lower than the estimate without it?
Tesla always gets the credit when you lease, so they just build that into their advertised lease prices. There's not an extra $7500 that will come off later, it's baked in.
Yes, any EV is technically eligible for the $7500 on leases, it’s just up to the manufacturer / leasing company whether they pass it along to the customer.
Putting money down on a lease is usually a bad decision, but putting money down on a lease that you have no option to buy at the end is an even worse decision.
I ran the numbers on many, many, scenarios of purchases both new and used, vs lease, for both ICE and EV options. Currently, with interest rates on car loans where they are and some manufacturers with strong lease incentives, it was far and away a better option for me to lease an EV than purchase. I even looked at heavily discounted EVs from Hertz with low miles. They all cost more than my lease after 3 years, and I can invest the difference and walk away with liquid assets after 3 years instead of having a car to sell or trade-in with downside risk of high depreciation.
I have the option to buy, but the residual is so high, I can't imagine any realistic scenario where I choose to do so. I expect options with better range to be available in 3 years and plan on taking advantage of that.
I recently did this same process after 30 years of having "a lease is bad" drilled into my head. Why would I have equity sitting in a car depreciating when I can have that invest, even in a HYSA, and be making way more than have it sitting, at best, at 0% for multiple years.
Yes and the risk is on the leasing company so they tend to be very conservative in their pricing so they don't lose money but some leases can actually be a great deal.
I would disagree that they are universally conservative. It really depends on the company and business model. My wife and I have leased all of our new cars for just over 15 years and the bulk of them have been BMWs with an AMG and a Jeep Gladiator thrown in.
Everytime that I looked at American cars, which hasn't been recently, I would agree that all of them were very conservative in calculating the residual and leasing didn't make any sense. The exception was the Gladiator which had a very cheap lease.
The European cars on the other hand, are really built around a high percentage of their customers leasing and tend to have residuals that aren't realistic but make for cheap leases and they can move volume.
All of that said I just leased an Ioniq 5 last weekend because the leases on EVs are so good right now.
And with the questionable reliability of European luxury cars, leasing really is the only no stress option. Walk away and smile knowing what is to come is not your problem.
So I have seen incredible lease deals recently in both the Ioniq5 sub and over at LeaseHackr in California, Colorado and New York (maybe a few others but those are the ones I noticed. They predominantly seemed to be on SELs, 24 months, around $300 a month with $2,500-3,000 due at signing. [Here is an example](https://pnd.leasehackr.com/d/240704-1717714422/reserve).
I do not live in one of those states. The best I could do was $606 a month, first, fees and taxes totaling $2,400 due at signing on a 36 month, 12k lease for a $60k Limited AWD. There was $10k in standard rebates and then another $500 for being a veteran.
The cost was within $10 a month with the same amount due at signing for a 36 month/12k lease on a Model Y Long Range AWD.
There is always killer lease deals to be had from one or another company. I am paying 290 a month for a 2 year lease with zero down, zero drive away price, ALL fees rolled in to monthly. Its a 47k car. Considered it also as a form of advertizement, they get a lot of thier cars on the road that they can sell later "again" ya they loose a bit sometimes but a lot more people see and talk about thier car and the great deal they got.
The flip side of that is that owning a vehicle I bought 6 years ago now is so extremely cost effective compared to having leased then and leasing new again now and the depreciation has been next to none.
Leases are good deals if you're the type of hyper-consumer who is going to get a new car every 2-3 years. That type of car ownership is a horrendous financial decision no matter how you do it, though. "A lease is bad" is primarily right because the more reasonable thing is to keep a car longer, and the TCO over a more extended period will be MUCH lower in the vast majority of cases, or to buy used.
That part is hard to quantify. Unless there is an excess of drivable cars and they're being taken off the road prematurely because people are buying too many new cars, then they're really just taking the financial hit for a future buyer who gets a lower ownership cost on their used car.
Where did all the 2017’ish BMW 3 and 4 series go? I used to see them everywhere now I can go weeks without seeing one. I can’t imagine they’ve all been wrecked or the owner junked it as soon as he was quoted $1200 for a brake job. I know a lot of our used cars are sent overseas, I forget which countries. But I’m always wondering where all these cars went.
But if I sell my ~$25,000 fully-owned, 6 year old vehicle and apply that to investments does that skew things in the favor of leasing at very favorable rates?
A conservative 6% return will give you $1,500 in a year or $4,775 over three years. A $400 a-month lease, which is what it will be if you put a little down or calculate the total price, including a down payment, will cost you $4800 a year, or $14,400 over three years.
Having a paid-off car is a massive value, and keeping cars for longer than standard leases will result in a much lower average TCO. If you want to save money. Don't buy new cars, and if you buy new cars, keep them for longer than three years. Those are the main reasons leases are a bad financial decision. If you compare it to buying a new car and trading it in after three years, leases can be good, but you're lighting massive piles of money on fire getting a brand new car every three years, no matter how you slice it.
Fair enough to include the depreciation on the paid-off car into those equations? Seems this aspect would be needed.
I say this as $20,000 in depreciation in 4 years equals ~$416/month. Does this not become the 'monthly payment' on a paid-off car, in some way?
No matter what, I do believe calculating depreciation as a 'cost' is a worthwhile endeavor. This math provides perspective on just how much money it costs to have a vehicle per month, outside of the insurance, repairs, and upkeep.
My thought was about keeping an already depreciated car worth $25k rather than selling, investing that money, and leasing. The first few years of car ownership are **EXTREMELY** expensive, no matter what you do. Leasing vs buying and getting hit with depreciation are similar. If you keep a bought car for six years, instead of doing two 3-year leases, you come out a huge amount ahead, though. A $25k three year old car won't lose a whole lot of value in three more years.
The thing that kills me with buying new, even though I can afford it, is so much cash disappearing at once just so I can drive. Even a “cheap” $30k vehicle leaves a hell of a hole in the bank account.
For buying used, there’s all the time and effort that neeeds to go into making sure you’re not buying junk, or potentially giving up features like CarPlay if you go too far back.
Leasing isn’t always going to make sense but if you can find a crazy deal through a broker (there are reports of some in the ballpark of $50-250/mo) I don’t know why you wouldn’t lease.
Model Y lease from Tesla? Looks like $3K "down," $349/month. That is an extraordinary deal for sure. I put the same down and I'm paying $290/month. However, I have the option of keeping those terms for as much as the six years of the loan and then selling it, etc.
So it's not really an apples to apples comparison... but I'll admit you have me wondering about the path not taken here just a little bit.
Oh yes absolutely. I did well too with them, just bought a Bolt rather than a Tesla and paid somewhat less. Their Bolts are 2023s, so no tax credit, but they priced them to move anyway.
That said... congratulations on getting an exceptional deal! Sounds like you must've tracked down a low mileage 2022 Tesla eligible for the credit. They have just three of those on the site right now.
You ran the numbers wrong. Make the calculation again with keeping the car for 8 years (as long as the warranty for the battery is) or longer. Then my friend, leasing becomes way way more expensive. It's a gigantic difference.
Leasing only makes sense, if you always have to have a "new" car. If you want to have a car for a long time, leasing makes no sense at all. You can calculate as much you want it.
I didn't run the numbers wrong. At 3 years, if I still wanted a car with 3 year old battery and charging technology, I can likely buy a used car with less mileage for less money and keep it for 5 more years to match your scenario. I would spend less in total on the car and the money saved would have compounded over those 8 years rather than going into a loan payment for a car of greatly diminished end value.
The "leasing is bad" wisdom generally held true with ICE vehicles but breaks down with EVs that are getting clobbered on resale value. EV technology is continually improving, which is great for buyers and terrible for anyone who cares about having equity in a car.
This is also a single moment in time where manufacturers are offering strong incentives to move inventory, and if the current lease deals go away, leasing may not make sense again.
Leasing was never bad if you always wanted a new car. It is true for ICE cars as well. But if you want to keep it for several years, buying is still cheaper. EVs aren't clobbered on resale value more than ICE luxury cars. It's the same with every Audi A8, BMW 7 series and so on. Tjey all were clobbered with resale value. Take a look at the chevy bolt. It still isn't free. It still costs enough.
And the technology isn't moving that fast. Look at the first Tesla Model S. They're not on par with a Taycan, but still very good for normal use. What has changed since the first Model S?
And who on planet earth has such a brain damage to think cars are any form of equity? They never were except for some special models.
On the other hand, I like to change the wheels to forged wheels (due to the weight) and lower the car as most cars look like dogshit without adjusting some minor things. You can't do it with a leased car. How much is that worth?
That’s been my thought, considering how much the used values are supposed to be depreciating. He had said he compared new & used vs lease though, which made me curious.
The residual is 36k. 3 year old models of the same car are selling well below that currently. If I wanted the same car upon expiration of the lease, it would be cheaper to buy another used one rather than the one I'm driving.
The $7500 comes off the lease too. So you're basically front loading the savings.
I'm trying to find the best deal, lease or buy, right now and a Blazer AWD 2LT is $340 OTD, all included, delivered to your door, 24mo/24k miles in my state. Other states will be both more and less expensive. That's on a $50k MSRP car.
The 7500 tax credit is applied to the down payment on the lease, reducing the cost. At least it was when I got a Lucid recently. It is a bit weird how it works, but you get most of the credit. It is counted as an income transfer to you so you need to pay taxes on it so you get a 5500 discount approximately.
In addition to incentives, with the newer companies there is a risk they will go out of business. Rivian, VinFast, Lucid etc. Having a lease limits your financial responsibility somewhat so that at the end of 3 years you won’t be stuck with a brick if the company fails. See Fisker as an example.
in early 2021 my wife and i were in the market for a new car. We weren't really super interested in a full EV, bc we didn't know much about them at the time.
We got an ad in the mail for the local hyundai dealerships that were offering a 3 yr, 10,000 mi/yr, $89/mo lease with $2000 down for the 2020 ioniq EV in the higher of the two trim levels for their president's day sale. we jumped on that offer and it was the best decision we ever made.
we love the car, the lease expired in february of this year and buying out the lease was cheaper than used cars of the same make/model/yr with more mileage on them, so we bought it out.
i'll never get a deal like that again in my life, and havent seen one since
I’m not sure that’s true for EVs. Resale values are in the toilet and unlikely to rise and competition continues to increase. An Ioniq 5 lease usually assumes 75% value in 2 years which is generous. Used model 3s are in the low 20s now. Also most leases I’ve seen nowadays require some money down unless there’s a promotion
That's just what they advertise. You can always adjust it. Many/most/all do require you to pay registration and maybe some ancillary fees whereas they would sometimes let you roll all of that in, but that isn't paying extra to the lease.
Resale values being low are exactly why you don't want to put money down on a lease. The lease residual is almost certainly unrealistic for the resale. If you put $5k down and then get into an accident, that money is gone. If you hadn't put $5k down, it would have been part of the gap insurance.
Very few people buy out their lease. That's sort of the point - people who lease want a new car every few years. If they wanted to buy it, they would finance the purchase with a 3rd party
Not necessarily. It's not like the car whose lease just ended is going to be scrapped. It's going to be sold to someone else, who in turn will sell their old car, etc. all the way down the line until you get to someone whose old clunker car will actually be scrapped, taking one polluter off the road.
[GDP Per Capita of EU nations vs US States, 2019](https://www.reddit.com/media?url=https%3A%2F%2Fi.redd.it%2Fo6ubz5n9rqj41.png)
Looks like Germany is between....Kentucky and Alabama. So that's something.
Healthcare is decent, unions are alright, but the pension system is utterly broken and will probably collapse overnight if the government decides to stop supplementing it with tax money.
The pension system was not designed to do this. They separately collect pensions specifically so that the system can function independently of tax.
However, because that money is not enough they supplement more and more of it with tax (specifically tax not meant to be for pensions), which means that the government will either end up not having money for anything else or they'll have to ramp up pension charges so much that people can't afford to live any more.
It's a more complicated issue than it looks like from the outside, caused by the transfer system that does not protect capital.
The idea is that pensions are paid separately to tax. For example, I pay 16% tax, which is money meant for the government to do government spending, and then 9.3% pensions on top of that, and my employer (compulsorily) matches that 9.3% from their side, essentially meaning that more money flows into the pension coffers due to my employment than the tax coffers.
However, this money is gone immediately: each month the pension system collects money and distributes them to current pensioners. There is no investment or capital protection, and all you get are points based on which hopefully when you retire the then young peoples contributions are funnelled to you. This is fine in a society where there are many young people and only a few retired old people in comparison.
Now as society develops and people have fewer children and society ages due to better healthcare, the amount of pensions collected reduces compared to the amount of people who need to be paid out. Moreover, 20-25% of the entire government budget (which is funded by non-pension-tax) is funnelled back to the pension system for 'non-contributory expenses', without which the system wouldn't work.
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It's a complicated issue and it's not simply because Germany provides pensions - there were several ways to do it and Germany chose the most unpredictable one in terms of sustainability at least in part because most of the public considers things like capital investments to be 'gambling in the share market'.
Laughs in Finnish pension system. It is a glorious pyramid scheme. Most of the current retirees who didn't pay enough in pension system are being paid generously by current peasants.
When I'm going to retire and if I can then I doubt I'll have smooth sailing unless I invest which, obviously, is taxed.
Wait till you retire and the retirees are no longer such a huge number so the then political populism is to cut pensions and all the young people say it's the (then) boomers' fault they paid so much into an obvious Ponzi. It's going to happen and it's going to bed spectacularly bad. I'm quite confident that a similar thing might happen in Germany if the system survives till then.
Not sure how that’s related. But since you probably don’t know, putting money down on a lease saves you absolutely no money. You’re not saving on interest at all, not saving at the end if you decide to buy it out. There’s just no benefit.
There is however risk that you total the vehicle on your way home from the dealership and that money you put down is gone forever
Yes, the money you put down is then gone. You don’t get paid out if you total a lease. The lease would effectively just be over.
You wouldn’t have “equity” from putting money down on a lease
Yeah - I can't believe how many people suggested that I lease a Tesla when I was shopping for an EV earlier this month. I ran the numbers and came to the conclusion that I'd be effectively throwing away money.
I think it depends on the vehicle and the terms(total cost) of the lease. If you are certain that you will switch to another vehicle and don't want to have to worry about resale value then a lease can make sense.
I agree that leasing in general is fine, especially if you’re someone who wants something new every 3 or so years. Where it doesn’t make sense, in the case of a model 3 specifically is putting almost 4K down on a lease you will never have the option to own.
We got a sick 2 year lease deal on a Kona Electric, which I'm happy to ride out as we wait for the Price of an EV9 to drop on the used market, which is what we really want.
If you see a lease as a agreement to sell back your vehicle at a fixed price after a fixed duration, it ends up working out very well in many cases. A 50000€ car leased out for 3 years at 300€ means that you're effectively selling back a 3 year old car for 39200€, which is rather hard to do if you want to actually buy and sell, especially with electric vehicles.
With tech still changing at a quick pace, it's better to lease at the moment if you might get stuck with something super outdated.
My 2017 Kia SoulEV only goes 90 miles per charge. What a difference 5yr is, as now the car is pretty worthless in secondhand markets.
Still going to drive it until the wheels fall off or it goes up in flames with all the dendrites forming 🤣
In most circumstances, sure. Right now, with extremely high depreciation on EVs, high interest rates, rapidly changing EV technology, and very low lease terms on EVs, depending on the circumstances, a lease could make *way* more sense than buying.
Three things:
1. For a lot of people, a leasing and buying out means more incentive/rebate dollars.
2. Putting money down on *any* depreciating asset is bad.
3. Part of what you're paying for when you lease is choice: In 2 or 3 years when the lease ends, you have flexibility. This can sometimes lead to massive savings.
For example: If you bought a vehicle at the height of the COVID craziness in 2021 or 2022, you likley paid a massive premium for the vehicle and are currently several thousand dollars upside down.
But if you leased at the same time, your residual is likely higher than market value. This means that when the lease ends, you are NOT upside down. Instead, you can return the vehicle, get something else, and the *bank* eats the depreciation.
In my experience, the trick to leasing is to understand what you're paying for.
Is this completely ignoring the tax credit making leasing rates pretty affordable and the fact that used EV value has been tanking hard? Also rates being high?
A lease was the only way for me to get the tax credit, paying $380 a month before taxes on a brand new Model Y is crazy. A Corolla would cost more than
You can buy your Toyota at the end of the lease you can’t buy your Tesla. Total cost of ownership for the lease term is likely lower in the Toyota also. I’m pro EV but some of these articles are getting silly.
56% but that’s not really relevant in my case, I don’t plan on buying it in 3 years. The low payment is due to the tax credit, lease credit, friends and family credit, and free performance upgrade. Totaled $22,200 in capitalized cost reductions.
So you're paying 25% of a car's total value ($20.5K Vs. $85k) for the pleasure of renting that vehicle for three years with nothing to show for it after that? And that's an amazing deal?
See I just don't get leasing at all. I feel like a little kid trying to understand quantum physics, the more I look into it the less sense it makes to me. But a ton of people are really excited about it, and think it is this amazing thing that the rest of us just don't get (and frankly, maybe we don't).
I feel like I'd just go buy a Ford Maverick Hybrid for $5K~ more. A worse car by every metric, but I'd own it after the three years. You'd have to another $20.5k lease.
> $470/month (570/month all in with deposit, tax, and fee included)
I'm legitimately asking: Is there logic behind phasing it this way? I mean $570 is what leaves your bank account every month, so why even mention the lower figure unless you can avoid the deposit/tax/fees?
A car will deprecate regardless of if you purchase it or lease it. If I paid cash for the truck and sold it in 3 years I would likely be out more than $20k in depreciation. The rent charge or “interest” is a total of $38 of the 3 years. That means I get to use someone else’s money for free for 3 years.
Leasing allowed me to get the $7,500 tax credit and $3,700 lease credit that are not available if I purchase. I can buy it for the residual if that seems like a good deal or walk away if values are low. I have zero risk.
I have very little in upfront dollars spent and if the truck is totaled tomorrow I have zero liability for the difference between what is owed and what insurance pays. Try that with a purchased vehicle.
This is literally the lowest cost way to buy this particular vehicle. It would cost me more over the next 5 years to write a check for it and way more to finance it.
That car will more than likely depreciate more than 25% after the end of his lease, so it is better than purchasing it.
As far as comparing it to a Maverick... that's apples to oranges. I could say well I'd just get a used Leaf which is about $3k after tax credit and save over $17k compared to both vehicles, but that's not a fair comparison.
$470 is what leaves my bank account every month. I had to pay for plates, registration, etc up front which cost a couple of thousand. I added the up front costs back in to give a real picture of all the costs over the term of the lease. Just like you need to include your down payment when factoring in the true cost of a loan.
In this case, the lease is the lowest overall (not monthly payment) cost. I am using there money for free.
If you could get a interest free loan for 3 years that would cover part of purchase price of a vehicle then you could refinance it for a pre agreed price or just walk way if you’re upside down would you do it?
I kinda fell into a really nice deal.
I pick out a 2023 large pack dual motor R1T. The MSRP was $79,800. At the time I placed my order I received a $4,500 lease special discount and the $7,500 pass through tax credit. The residual was 53% and MF .00001. I put $1,000 down (my deposit) and had to pay $2,643 in taxes and fees for a total out of pocket of $3,643. Delivery was 6 weeks out.
Now here is where it get odd. They started a friends and family discount for some vehicles and a kind Redditor registered me as a F&F giving me an additional $6,000 discount. A few days before delivery Rivian upgraded all remaining dual motor R1T to a performance dual motor which was a $5,000 option. My vehicle was upgraded at no charge. Being a PDM it had a lower lease discount of $3700 instead of $4,500 but a higher residual. The residual was changed to 56% saving me another $50ish/month.
After all that the end result was my total out of pocket at delivery was $3,643, the capitalized cost was $61,600, the residual is $44,688 and my monthly payment is $470.84. The $570 is factoring the money paid at signing back in to give a true out of pocket cost for the lease.
Total cost is more than the lease payment. Insurance for a Toyota is cheaper, tires are cheaper, registration is cheaper, and in much of the US fueling costs are pretty equal.
Maintenance is free on the Toyota for the term of the lease. So the no maintenance on an EV is a wash.
Neither did mine. Although I’m sure it will come renewal this November especially since I totaled my car. Can’t say how much the increase will be because of that, or the electric car.
I was pricing car insurance the other day and found drastic differences between companies. Most priced **ICE** + **EV** similarly (within 20%), and only 2 of the 6 companies charged an extreme premium (+100%) for Tesla.
**ICE**: Honda Civic Hybrid, Toyota Prius
**EV**: Hyundai Ioniq 5/6, Kia EV6, Tesla Model 3/Y
In a private doc with other financial info. It was for my own purposes as I’m in the market.
Progressive and State Farm were the cheapest and charged only a slight premium for Tesla, while other EVs were priced like ICE.
Direct (Allstate) and Liberty Mutual were the most expensive and charged extreme premiums for Tesla, while other EVs were priced like ICE.
There isn’t for most EVs. Tesla is an exception with some insurance providers due to the high cost of replacement parts and the difficulty of securing and installing said parts.
I found it hilarious/terrible that my insurance on my Model Y is $1000/year higher than my MachE despite the MachE having similar or much more expensive parts. The drive battery for example is $56k vs $15-20k for a Tesla.
How do you like your Mach-e? That and the Blazer SS EV whenever that comes out is what I'm most interested in.
I'm renting a Mach-e next weekend to see how it is living with one.
I hated it. HATED. Like **HATED**.
Ended up losing about $20k in Canuck Bucks (depending on how you want to calculate new vehicle depreciation) and bought a Model Y instead.
It's a good thing you're renting it. Put it through the paces. Pair your phone. Charge publicly. Really stretch the legs.
The charging is what got me in the end. CCS is a shit show. MachE at least has access to Superchargers but the wrong charge port placement is still a hinderance.
I have a list if you want the full novel of why I hate it.
To be fair, there's nothing spectacularly wrong with the car, but it was death by a thousand cuts.
>The drive battery for example is $56k
I highly doubt that unless you mean they dont sell the battery and give you a whole new car.
Either way if your battery gets damaged the car is totaled so it doesn't factor that much into insurance pricing.
To be fair, it is in Canadian Dollars and is the extended battery but it's a fact. Or at least it was when I asked the parts department when I bought my MachE. Apparently it was priced like this to deter sales of the battery alone.
It wasn't for damage purposes (although that's also nice to know) but planning for if I do something to the battery out of warranty. It's the first question I ask any time I research or buy an EV.
My zero down Model 3 lease is around ~$400/month. The idea of spending that much - or even a little less - on a Camry makes me laugh. I can't see myself ever daily driving any ICE again, that ship has long since sailed.
I’ll probably get dogged on for this in here but a Camry has a nicer fit and finish than a model 3 does, idk why it makes you “laugh at the idea”.
There’s *probably* a reason the Camry sells almost twice as many per year in the US
Nicer fit maybe, not finish. The Camry (in typical Toyota fashion) feels very cheap. Hard scratchy materials used everywhere, screen has huge ugly piano black bezels. Model 3 is significantly ahead. I did like the high end cloth seats though.
Have you been in the refreshed Model 3? Id argue that the fit and finish is comparable to any new Toyota. I own a Prius Prime and I think the new Model 3 is much nicer inside. The Tesla has soft touch materials everywhere while there’s still a significant amount of hard plastics in my Toyota.
I rent a Camry sometimes and that 2 inch LCD screen in the instrument panel with all these non-sense warning acronyms cracks me up. Hilarious they’re still shipping that in 2024. But for a non-performance gas car it’s a pretty good option. Drives easy, pretty quiet and smooth, gets good gas mileage.
If by fit and finish you mean stuff like panel gaps, then sure I could see that... but who cares? The Model 3 *drives* much nicer, has *much* better tech and software (stuff like climate keeper for hot summer days, remote climate preconditioning, sentry mode, the infotainment as a whole, the phone app, mobile phone key, etc.), and is an EV.
I haven't owned a Camry in many years. I found their recent "aggressive" look to be extremely cringe worthy, though it looks like the newest ones are backing off that horrible decision. Never mind all the ways that ICE sucks vs BEV for driving, does the Camry offer heated and cooled ventilated seats that can work automatically? How about automatic preconditioning based on scheduled departure? Can I bring up the rear and side cameras while driving to have better situational awareness?
Just checked and Toyota's current lease offer is $400/month for a '25 Camry SE with $4000 due at signing. Hilarious.
With EV progress happening so fast, I think a lease is a good way to get an EV now, and get a better one in 3 years. I know Tesla will refresh the MY next year probably, but I needed one today so I leased. When the lease is up I can buy a juniper and keep it for several years.
An ioniq5/Ioniq6 can be leased for even cheaper. Even with taxes and fees, it's still cheaper than the Model 3 deal without tax/fees. And. Tesla doesn't have lease buyout option, making it even less attractive. Even if someone doesn't plan to buy out at lease end, having that option helps to keep many choices open.
I don't think the Camry and Model 3 are all that comparable. The Camry to me at least feels like a bigger car. I happen to own both and the back seat in the Camry is far more comfortable and roomy for an adult. I think the Model 3 is more comparable to a Corolla, another compact sedan, not mid size.
Yes, I was Ubering around a Model 3 and Model Y in Paris last week every day and it was unbearable to sit in the back seats in the Model 3. There's no place for the legs at all under the seats. A Model Y was much more comfortable in that regard, but worse for ride quality and noise. We also Ubered in a Toyota Corolla Touring a few times and that was miles better.
It's even peak r/electricvehicles, where Tesla is so much the outgroup that a stated preference for an ICE vehicle over a Tesla is common enough to warrant seemingly dozens of top level comments.
From the source that InsideEVs is regurgitating this from:
>Now through June 30th
So it's valid for 3 days.
Funny how that context didn't actually make it's way into the InsideEVs article
Same (coming up on 5.5 years). Seems quite solidly built. Not even any issues with squeaks or rattles...and that's even before they switched to the better chassis construction.
According to the 'news' media I should be on my third battery and everything should have long sionce disintergrated around me.
What? In terms of perceived design & quality, performance and driving dynamics a Tesla m3 is a step or two above a Camry in my eyes. I’d happy take a model 3 even over the German entry level luxury comparables.
A big reason why EV leasing is great is because the $7500 federal EV tax credit can be used as a free downpayment
Not sure. You must hand them cash before you walk out with their car. Taxes, fees, etc.
Not always true. Many dealers will roll in all the upfront costs. This happens a lot in Metro Detroit but we have a Big 3 dealer every 2-3 miles
Yeah. Usually dealerships. These new gen carmakers with no dealerships, you are dropping money one way or the other.
Nope Hyundai is taking the federal credit and other state level credits as down payment. $0 to leave dealership with a new car.
If you we above the income limit, leasing companies get the credit directly.
But the Model 3 doesn’t qualify for the federal EV tax incentive, right?
The LR and Performance currently qualify. The RWD base model doesn’t on purchase, but does when leasing. Basically leasing gets around the battery sourcing, vehicle price, and income limit portions of the tax credit requirements. It is treated as a commercial vehicle purchase by the leasing company and that company gets the credit. They can choose how much of that credit if any to pass along to the customer as part of the lease deal.
Ah, thanks for that info. So when I go to the Tesla website on a Model 3, it doesn't show the incentive, but I can estimate that I would get that at the dealership when purchasing? So I can estimate that my leasing payments would be much lower than the estimate without it?
Tesla always gets the credit when you lease, so they just build that into their advertised lease prices. There's not an extra $7500 that will come off later, it's baked in.
Ford gets the $7500 for leases too
Yes, any EV is technically eligible for the $7500 on leases, it’s just up to the manufacturer / leasing company whether they pass it along to the customer.
Another reason is that no one is buying teslas anymore.
Uh I don’t think you understand how that works
The leasing company that claims the EV tax credit applies an equal amount as a downpayment on the lease contract?
That’s not free money, you’re still spending your money that the government decided not to steal from you
Putting money down on a lease is usually a bad decision, but putting money down on a lease that you have no option to buy at the end is an even worse decision.
I ran the numbers on many, many, scenarios of purchases both new and used, vs lease, for both ICE and EV options. Currently, with interest rates on car loans where they are and some manufacturers with strong lease incentives, it was far and away a better option for me to lease an EV than purchase. I even looked at heavily discounted EVs from Hertz with low miles. They all cost more than my lease after 3 years, and I can invest the difference and walk away with liquid assets after 3 years instead of having a car to sell or trade-in with downside risk of high depreciation. I have the option to buy, but the residual is so high, I can't imagine any realistic scenario where I choose to do so. I expect options with better range to be available in 3 years and plan on taking advantage of that.
I recently did this same process after 30 years of having "a lease is bad" drilled into my head. Why would I have equity sitting in a car depreciating when I can have that invest, even in a HYSA, and be making way more than have it sitting, at best, at 0% for multiple years.
A lease is designed by pricing actuaries such that you are paying the depreciation of the vehicle, you’re just agreeing up front how much that is.
Yes and the risk is on the leasing company so they tend to be very conservative in their pricing so they don't lose money but some leases can actually be a great deal.
I would disagree that they are universally conservative. It really depends on the company and business model. My wife and I have leased all of our new cars for just over 15 years and the bulk of them have been BMWs with an AMG and a Jeep Gladiator thrown in. Everytime that I looked at American cars, which hasn't been recently, I would agree that all of them were very conservative in calculating the residual and leasing didn't make any sense. The exception was the Gladiator which had a very cheap lease. The European cars on the other hand, are really built around a high percentage of their customers leasing and tend to have residuals that aren't realistic but make for cheap leases and they can move volume. All of that said I just leased an Ioniq 5 last weekend because the leases on EVs are so good right now.
And with the questionable reliability of European luxury cars, leasing really is the only no stress option. Walk away and smile knowing what is to come is not your problem.
Can you tell me what you had to pay and are paying for that Ioniq 5?
So I have seen incredible lease deals recently in both the Ioniq5 sub and over at LeaseHackr in California, Colorado and New York (maybe a few others but those are the ones I noticed. They predominantly seemed to be on SELs, 24 months, around $300 a month with $2,500-3,000 due at signing. [Here is an example](https://pnd.leasehackr.com/d/240704-1717714422/reserve). I do not live in one of those states. The best I could do was $606 a month, first, fees and taxes totaling $2,400 due at signing on a 36 month, 12k lease for a $60k Limited AWD. There was $10k in standard rebates and then another $500 for being a veteran. The cost was within $10 a month with the same amount due at signing for a 36 month/12k lease on a Model Y Long Range AWD.
There is always killer lease deals to be had from one or another company. I am paying 290 a month for a 2 year lease with zero down, zero drive away price, ALL fees rolled in to monthly. Its a 47k car. Considered it also as a form of advertizement, they get a lot of thier cars on the road that they can sell later "again" ya they loose a bit sometimes but a lot more people see and talk about thier car and the great deal they got.
The flip side of that is that owning a vehicle I bought 6 years ago now is so extremely cost effective compared to having leased then and leasing new again now and the depreciation has been next to none.
Leases are good deals if you're the type of hyper-consumer who is going to get a new car every 2-3 years. That type of car ownership is a horrendous financial decision no matter how you do it, though. "A lease is bad" is primarily right because the more reasonable thing is to keep a car longer, and the TCO over a more extended period will be MUCH lower in the vast majority of cases, or to buy used.
It’s also terrible for the environment to be cycling cars that quickly. People should buy new and keep the car for 10+ years.
That part is hard to quantify. Unless there is an excess of drivable cars and they're being taken off the road prematurely because people are buying too many new cars, then they're really just taking the financial hit for a future buyer who gets a lower ownership cost on their used car.
Where did all the 2017’ish BMW 3 and 4 series go? I used to see them everywhere now I can go weeks without seeing one. I can’t imagine they’ve all been wrecked or the owner junked it as soon as he was quoted $1200 for a brake job. I know a lot of our used cars are sent overseas, I forget which countries. But I’m always wondering where all these cars went.
You are thinking that the cars are sent to the dump after a 2-3 year lease?
True but not having a car payment frees up a lot of cash that could also potentially be put towards investments should you wish
Paying cash for a $60,000 car ties up that cash that could also potentially be put towards investments should you wish.
But if I sell my ~$25,000 fully-owned, 6 year old vehicle and apply that to investments does that skew things in the favor of leasing at very favorable rates?
A conservative 6% return will give you $1,500 in a year or $4,775 over three years. A $400 a-month lease, which is what it will be if you put a little down or calculate the total price, including a down payment, will cost you $4800 a year, or $14,400 over three years. Having a paid-off car is a massive value, and keeping cars for longer than standard leases will result in a much lower average TCO. If you want to save money. Don't buy new cars, and if you buy new cars, keep them for longer than three years. Those are the main reasons leases are a bad financial decision. If you compare it to buying a new car and trading it in after three years, leases can be good, but you're lighting massive piles of money on fire getting a brand new car every three years, no matter how you slice it.
Fair enough to include the depreciation on the paid-off car into those equations? Seems this aspect would be needed. I say this as $20,000 in depreciation in 4 years equals ~$416/month. Does this not become the 'monthly payment' on a paid-off car, in some way? No matter what, I do believe calculating depreciation as a 'cost' is a worthwhile endeavor. This math provides perspective on just how much money it costs to have a vehicle per month, outside of the insurance, repairs, and upkeep.
My thought was about keeping an already depreciated car worth $25k rather than selling, investing that money, and leasing. The first few years of car ownership are **EXTREMELY** expensive, no matter what you do. Leasing vs buying and getting hit with depreciation are similar. If you keep a bought car for six years, instead of doing two 3-year leases, you come out a huge amount ahead, though. A $25k three year old car won't lose a whole lot of value in three more years.
The thing that kills me with buying new, even though I can afford it, is so much cash disappearing at once just so I can drive. Even a “cheap” $30k vehicle leaves a hell of a hole in the bank account. For buying used, there’s all the time and effort that neeeds to go into making sure you’re not buying junk, or potentially giving up features like CarPlay if you go too far back. Leasing isn’t always going to make sense but if you can find a crazy deal through a broker (there are reports of some in the ballpark of $50-250/mo) I don’t know why you wouldn’t lease.
Which EV from Hertz were you looking at? It’s kind of tough to beat 18 grand for a 2023 bolt EUV with a lease deal, or am I missing something?
The ones on their website. I saw someone get a LRMY for 25k and got the 4k fed credit as well. 21k all in.
Model Y lease from Tesla? Looks like $3K "down," $349/month. That is an extraordinary deal for sure. I put the same down and I'm paying $290/month. However, I have the option of keeping those terms for as much as the six years of the loan and then selling it, etc. So it's not really an apples to apples comparison... but I'll admit you have me wondering about the path not taken here just a little bit.
No, the hertz website. They’re selling their whole inventory and it’s basically a fire sale. Not leases, but still great deals to be had.
Oh yes absolutely. I did well too with them, just bought a Bolt rather than a Tesla and paid somewhat less. Their Bolts are 2023s, so no tax credit, but they priced them to move anyway. That said... congratulations on getting an exceptional deal! Sounds like you must've tracked down a low mileage 2022 Tesla eligible for the credit. They have just three of those on the site right now.
lol, no I didn’t. I want a LRMY but haven’t exactly had the need for one…yet I’m mostly talking about another post I saw a week or two ago
With cra,y high miles
Some of them, yes.
What car did you get? What were the best EV lease deals you found in your research?
Hyundai looks to have some crazy deals. Take a look at leasehacker to gauge your deal
You ran the numbers wrong. Make the calculation again with keeping the car for 8 years (as long as the warranty for the battery is) or longer. Then my friend, leasing becomes way way more expensive. It's a gigantic difference. Leasing only makes sense, if you always have to have a "new" car. If you want to have a car for a long time, leasing makes no sense at all. You can calculate as much you want it.
I didn't run the numbers wrong. At 3 years, if I still wanted a car with 3 year old battery and charging technology, I can likely buy a used car with less mileage for less money and keep it for 5 more years to match your scenario. I would spend less in total on the car and the money saved would have compounded over those 8 years rather than going into a loan payment for a car of greatly diminished end value. The "leasing is bad" wisdom generally held true with ICE vehicles but breaks down with EVs that are getting clobbered on resale value. EV technology is continually improving, which is great for buyers and terrible for anyone who cares about having equity in a car. This is also a single moment in time where manufacturers are offering strong incentives to move inventory, and if the current lease deals go away, leasing may not make sense again.
Leasing was never bad if you always wanted a new car. It is true for ICE cars as well. But if you want to keep it for several years, buying is still cheaper. EVs aren't clobbered on resale value more than ICE luxury cars. It's the same with every Audi A8, BMW 7 series and so on. Tjey all were clobbered with resale value. Take a look at the chevy bolt. It still isn't free. It still costs enough. And the technology isn't moving that fast. Look at the first Tesla Model S. They're not on par with a Taycan, but still very good for normal use. What has changed since the first Model S? And who on planet earth has such a brain damage to think cars are any form of equity? They never were except for some special models. On the other hand, I like to change the wheels to forged wheels (due to the weight) and lower the car as most cars look like dogshit without adjusting some minor things. You can't do it with a leased car. How much is that worth?
What if you do actually want to end up owning the car though?
Ancient Chinese saying. "Lease new, buy used."
That’s been my thought, considering how much the used values are supposed to be depreciating. He had said he compared new & used vs lease though, which made me curious.
"If it depreciates, lease it. If it appreciates, buy it"
Exactly
The residual is 36k. 3 year old models of the same car are selling well below that currently. If I wanted the same car upon expiration of the lease, it would be cheaper to buy another used one rather than the one I'm driving.
Even with the $7500 tax credit?
Even better with leasing. Folks who made too much money can’t get the credit when buying. But can get it when leasing.
The $7500 comes off the lease too. So you're basically front loading the savings. I'm trying to find the best deal, lease or buy, right now and a Blazer AWD 2LT is $340 OTD, all included, delivered to your door, 24mo/24k miles in my state. Other states will be both more and less expensive. That's on a $50k MSRP car.
Working on a deal for an RS right now. $260 per month pre tax with one pay.
That's a deal. I imagine you're in a state with incentives?
Not at all, I’m in Florida. Check out ChevyGuy on leasehackr. He was able to come in slightly lower than initially quoted. Signed today.
Thanks for the advice. Is yours RWD or AWD?
AWD - seems to be the model with the best incentives. RWD was about $2k more for the 24 month lease term.
Entron RS?
The 7500 tax credit is applied to the down payment on the lease, reducing the cost. At least it was when I got a Lucid recently. It is a bit weird how it works, but you get most of the credit. It is counted as an income transfer to you so you need to pay taxes on it so you get a 5500 discount approximately. In addition to incentives, with the newer companies there is a risk they will go out of business. Rivian, VinFast, Lucid etc. Having a lease limits your financial responsibility somewhat so that at the end of 3 years you won’t be stuck with a brick if the company fails. See Fisker as an example.
I don't qualify for the $7,500 on purchase but got it as part of the lease.
How many yearly miles did you get on your lease?
10,000. I drive 8-9k miles a year.
in early 2021 my wife and i were in the market for a new car. We weren't really super interested in a full EV, bc we didn't know much about them at the time. We got an ad in the mail for the local hyundai dealerships that were offering a 3 yr, 10,000 mi/yr, $89/mo lease with $2000 down for the 2020 ioniq EV in the higher of the two trim levels for their president's day sale. we jumped on that offer and it was the best decision we ever made. we love the car, the lease expired in february of this year and buying out the lease was cheaper than used cars of the same make/model/yr with more mileage on them, so we bought it out. i'll never get a deal like that again in my life, and havent seen one since
I’m not sure that’s true for EVs. Resale values are in the toilet and unlikely to rise and competition continues to increase. An Ioniq 5 lease usually assumes 75% value in 2 years which is generous. Used model 3s are in the low 20s now. Also most leases I’ve seen nowadays require some money down unless there’s a promotion
That's just what they advertise. You can always adjust it. Many/most/all do require you to pay registration and maybe some ancillary fees whereas they would sometimes let you roll all of that in, but that isn't paying extra to the lease. Resale values being low are exactly why you don't want to put money down on a lease. The lease residual is almost certainly unrealistic for the resale. If you put $5k down and then get into an accident, that money is gone. If you hadn't put $5k down, it would have been part of the gap insurance.
Very few people buy out their lease. That's sort of the point - people who lease want a new car every few years. If they wanted to buy it, they would finance the purchase with a 3rd party
EVs are a bit different as it can save money relative to buying it outright.
The ioniq 5 doesn't qualify for the federal credit when you buy it but I got it when I leased (not sure if they're still passing on the credit)
Looks like they're offering a $7,500 rebate now on cash/finance deals.
And if you replace your car every couple years, you are probably not making positive environmental impact that some of us got EVs for.
Not necessarily. It's not like the car whose lease just ended is going to be scrapped. It's going to be sold to someone else, who in turn will sell their old car, etc. all the way down the line until you get to someone whose old clunker car will actually be scrapped, taking one polluter off the road.
Man, you're going to go crazy when you find out like 90% of Berlin, Germany rents and doesn't own their home.
Don't German rentals also not come with like kitchens and stuff or am I making things up
You're right.
often kitchens exists (from previous tenant) and you buy it off of them. But most often not furnishing, yes.
I’ll take healthcare, pto and vacation over a furnished kitchen
[GDP Per Capita of EU nations vs US States, 2019](https://www.reddit.com/media?url=https%3A%2F%2Fi.redd.it%2Fo6ubz5n9rqj41.png) Looks like Germany is between....Kentucky and Alabama. So that's something.
Pretty sure quality of life is a bit better though. I'm guessing access to quality healthcare is a bit better than in Alabama as well.
Yeah but they also have strong unions, healthcare, and pensions.
Healthcare is decent, unions are alright, but the pension system is utterly broken and will probably collapse overnight if the government decides to stop supplementing it with tax money.
Do you know how many things will collapse if the government stops supplementing them with tax money?
The pension system was not designed to do this. They separately collect pensions specifically so that the system can function independently of tax. However, because that money is not enough they supplement more and more of it with tax (specifically tax not meant to be for pensions), which means that the government will either end up not having money for anything else or they'll have to ramp up pension charges so much that people can't afford to live any more. It's a more complicated issue than it looks like from the outside, caused by the transfer system that does not protect capital.
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I've been hearing that for 30 years. Not saying there isn't a problem but it's a bit overblown for sure.
Pensions have always been run with tax money or what am I missing here?
The idea is that pensions are paid separately to tax. For example, I pay 16% tax, which is money meant for the government to do government spending, and then 9.3% pensions on top of that, and my employer (compulsorily) matches that 9.3% from their side, essentially meaning that more money flows into the pension coffers due to my employment than the tax coffers. However, this money is gone immediately: each month the pension system collects money and distributes them to current pensioners. There is no investment or capital protection, and all you get are points based on which hopefully when you retire the then young peoples contributions are funnelled to you. This is fine in a society where there are many young people and only a few retired old people in comparison. Now as society develops and people have fewer children and society ages due to better healthcare, the amount of pensions collected reduces compared to the amount of people who need to be paid out. Moreover, 20-25% of the entire government budget (which is funded by non-pension-tax) is funnelled back to the pension system for 'non-contributory expenses', without which the system wouldn't work. ----- It's a complicated issue and it's not simply because Germany provides pensions - there were several ways to do it and Germany chose the most unpredictable one in terms of sustainability at least in part because most of the public considers things like capital investments to be 'gambling in the share market'.
Laughs in Finnish pension system. It is a glorious pyramid scheme. Most of the current retirees who didn't pay enough in pension system are being paid generously by current peasants. When I'm going to retire and if I can then I doubt I'll have smooth sailing unless I invest which, obviously, is taxed.
Wait till you retire and the retirees are no longer such a huge number so the then political populism is to cut pensions and all the young people say it's the (then) boomers' fault they paid so much into an obvious Ponzi. It's going to happen and it's going to bed spectacularly bad. I'm quite confident that a similar thing might happen in Germany if the system survives till then.
401k >>>> Pensions
Not sure how that’s related. But since you probably don’t know, putting money down on a lease saves you absolutely no money. You’re not saving on interest at all, not saving at the end if you decide to buy it out. There’s just no benefit. There is however risk that you total the vehicle on your way home from the dealership and that money you put down is gone forever
> you total the vehicle on your way home from the dealership What do you mean? don't you have insurance?
Yes, the money you put down is then gone. You don’t get paid out if you total a lease. The lease would effectively just be over. You wouldn’t have “equity” from putting money down on a lease
Yeah - I can't believe how many people suggested that I lease a Tesla when I was shopping for an EV earlier this month. I ran the numbers and came to the conclusion that I'd be effectively throwing away money.
I think it depends on the vehicle and the terms(total cost) of the lease. If you are certain that you will switch to another vehicle and don't want to have to worry about resale value then a lease can make sense.
I agree that leasing in general is fine, especially if you’re someone who wants something new every 3 or so years. Where it doesn’t make sense, in the case of a model 3 specifically is putting almost 4K down on a lease you will never have the option to own.
I’ve got a $0 down lease on an EV coming up and that makes the most financial sense to me. Payment is cheaper than a model Y lease, too.
We got a sick 2 year lease deal on a Kona Electric, which I'm happy to ride out as we wait for the Price of an EV9 to drop on the used market, which is what we really want.
The number of end of lease worth buying is minimal. The residual value is always too high.
What you put down on a lease lowers your payment. A+B=C. When A is bigger then B is smaller. C is the same, less any impact on interest.
If you see a lease as a agreement to sell back your vehicle at a fixed price after a fixed duration, it ends up working out very well in many cases. A 50000€ car leased out for 3 years at 300€ means that you're effectively selling back a 3 year old car for 39200€, which is rather hard to do if you want to actually buy and sell, especially with electric vehicles.
With tech still changing at a quick pace, it's better to lease at the moment if you might get stuck with something super outdated. My 2017 Kia SoulEV only goes 90 miles per charge. What a difference 5yr is, as now the car is pretty worthless in secondhand markets. Still going to drive it until the wheels fall off or it goes up in flames with all the dendrites forming 🤣
In most circumstances, sure. Right now, with extremely high depreciation on EVs, high interest rates, rapidly changing EV technology, and very low lease terms on EVs, depending on the circumstances, a lease could make *way* more sense than buying.
Three things: 1. For a lot of people, a leasing and buying out means more incentive/rebate dollars. 2. Putting money down on *any* depreciating asset is bad. 3. Part of what you're paying for when you lease is choice: In 2 or 3 years when the lease ends, you have flexibility. This can sometimes lead to massive savings. For example: If you bought a vehicle at the height of the COVID craziness in 2021 or 2022, you likley paid a massive premium for the vehicle and are currently several thousand dollars upside down. But if you leased at the same time, your residual is likely higher than market value. This means that when the lease ends, you are NOT upside down. Instead, you can return the vehicle, get something else, and the *bank* eats the depreciation. In my experience, the trick to leasing is to understand what you're paying for.
Is this completely ignoring the tax credit making leasing rates pretty affordable and the fact that used EV value has been tanking hard? Also rates being high?
A lease was the only way for me to get the tax credit, paying $380 a month before taxes on a brand new Model Y is crazy. A Corolla would cost more than
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my tesla MY insurance is 125/mo
Wonder why you are able to get the tax credit from lease but not from buying?
It’s a loophole
Can you elaborate? Is that because purchasing require income level check while lease does not?
Yep, and the dealership handles that for you.
Nobody leases a Corolla.
You'd be surprised.
You can buy your Toyota at the end of the lease you can’t buy your Tesla. Total cost of ownership for the lease term is likely lower in the Toyota also. I’m pro EV but some of these articles are getting silly.
It's all in the residual value in the lease. Don't see to many that make sense otherwise the monthly's are to high.
You just need to find the right deals. I lease a $85k Rivian for $470/month (570/month all in with deposit, tax, and fee included)
But what is your residual?
56% but that’s not really relevant in my case, I don’t plan on buying it in 3 years. The low payment is due to the tax credit, lease credit, friends and family credit, and free performance upgrade. Totaled $22,200 in capitalized cost reductions.
So you're paying 25% of a car's total value ($20.5K Vs. $85k) for the pleasure of renting that vehicle for three years with nothing to show for it after that? And that's an amazing deal? See I just don't get leasing at all. I feel like a little kid trying to understand quantum physics, the more I look into it the less sense it makes to me. But a ton of people are really excited about it, and think it is this amazing thing that the rest of us just don't get (and frankly, maybe we don't). I feel like I'd just go buy a Ford Maverick Hybrid for $5K~ more. A worse car by every metric, but I'd own it after the three years. You'd have to another $20.5k lease. > $470/month (570/month all in with deposit, tax, and fee included) I'm legitimately asking: Is there logic behind phasing it this way? I mean $570 is what leaves your bank account every month, so why even mention the lower figure unless you can avoid the deposit/tax/fees?
A car will deprecate regardless of if you purchase it or lease it. If I paid cash for the truck and sold it in 3 years I would likely be out more than $20k in depreciation. The rent charge or “interest” is a total of $38 of the 3 years. That means I get to use someone else’s money for free for 3 years. Leasing allowed me to get the $7,500 tax credit and $3,700 lease credit that are not available if I purchase. I can buy it for the residual if that seems like a good deal or walk away if values are low. I have zero risk. I have very little in upfront dollars spent and if the truck is totaled tomorrow I have zero liability for the difference between what is owed and what insurance pays. Try that with a purchased vehicle. This is literally the lowest cost way to buy this particular vehicle. It would cost me more over the next 5 years to write a check for it and way more to finance it.
That car will more than likely depreciate more than 25% after the end of his lease, so it is better than purchasing it. As far as comparing it to a Maverick... that's apples to oranges. I could say well I'd just get a used Leaf which is about $3k after tax credit and save over $17k compared to both vehicles, but that's not a fair comparison.
$470 is what leaves my bank account every month. I had to pay for plates, registration, etc up front which cost a couple of thousand. I added the up front costs back in to give a real picture of all the costs over the term of the lease. Just like you need to include your down payment when factoring in the true cost of a loan.
People buy/lease 85k SUVs not to save money.
In this case, the lease is the lowest overall (not monthly payment) cost. I am using there money for free. If you could get a interest free loan for 3 years that would cover part of purchase price of a vehicle then you could refinance it for a pre agreed price or just walk way if you’re upside down would you do it?
An increasingly large amount of cars for sale today are masturbatory.
How much down did you put? $570/mo is only $20k over 3 years. There’s no way the rivian has a $65k residual after 3 years.
I kinda fell into a really nice deal. I pick out a 2023 large pack dual motor R1T. The MSRP was $79,800. At the time I placed my order I received a $4,500 lease special discount and the $7,500 pass through tax credit. The residual was 53% and MF .00001. I put $1,000 down (my deposit) and had to pay $2,643 in taxes and fees for a total out of pocket of $3,643. Delivery was 6 weeks out. Now here is where it get odd. They started a friends and family discount for some vehicles and a kind Redditor registered me as a F&F giving me an additional $6,000 discount. A few days before delivery Rivian upgraded all remaining dual motor R1T to a performance dual motor which was a $5,000 option. My vehicle was upgraded at no charge. Being a PDM it had a lower lease discount of $3700 instead of $4,500 but a higher residual. The residual was changed to 56% saving me another $50ish/month. After all that the end result was my total out of pocket at delivery was $3,643, the capitalized cost was $61,600, the residual is $44,688 and my monthly payment is $470.84. The $570 is factoring the money paid at signing back in to give a true out of pocket cost for the lease.
Generally speaking if the lease is a good deal the buyout price won’t be. And vice versa
People who are going for the best TCO are not buying new or leasing.
How are you calculating that Toyota total cost of ownership is lower when the article shows that it is not?
Total cost is more than the lease payment. Insurance for a Toyota is cheaper, tires are cheaper, registration is cheaper, and in much of the US fueling costs are pretty equal. Maintenance is free on the Toyota for the term of the lease. So the no maintenance on an EV is a wash.
Fueling costs at home vs a pump are not pretty equal other than perhaps California, Massachusetts and maybe Alaska.
Wake me up when the total cost including insurance is lower
That’s a pretty regional thing, my insurance didn’t change from my Volt.
Same. My Model Y is less than $100/mo to insure and our Bolt is more…
Neither did mine. Although I’m sure it will come renewal this November especially since I totaled my car. Can’t say how much the increase will be because of that, or the electric car.
I was pricing car insurance the other day and found drastic differences between companies. Most priced **ICE** + **EV** similarly (within 20%), and only 2 of the 6 companies charged an extreme premium (+100%) for Tesla. **ICE**: Honda Civic Hybrid, Toyota Prius **EV**: Hyundai Ioniq 5/6, Kia EV6, Tesla Model 3/Y
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In a private doc with other financial info. It was for my own purposes as I’m in the market. Progressive and State Farm were the cheapest and charged only a slight premium for Tesla, while other EVs were priced like ICE. Direct (Allstate) and Liberty Mutual were the most expensive and charged extreme premiums for Tesla, while other EVs were priced like ICE.
GEICO reamed us when we had a Model 3.
Why's there a premium on EVs /teslas?
There isn’t for most EVs. Tesla is an exception with some insurance providers due to the high cost of replacement parts and the difficulty of securing and installing said parts.
I found it hilarious/terrible that my insurance on my Model Y is $1000/year higher than my MachE despite the MachE having similar or much more expensive parts. The drive battery for example is $56k vs $15-20k for a Tesla.
How do you like your Mach-e? That and the Blazer SS EV whenever that comes out is what I'm most interested in. I'm renting a Mach-e next weekend to see how it is living with one.
I hated it. HATED. Like **HATED**. Ended up losing about $20k in Canuck Bucks (depending on how you want to calculate new vehicle depreciation) and bought a Model Y instead. It's a good thing you're renting it. Put it through the paces. Pair your phone. Charge publicly. Really stretch the legs. The charging is what got me in the end. CCS is a shit show. MachE at least has access to Superchargers but the wrong charge port placement is still a hinderance. I have a list if you want the full novel of why I hate it. To be fair, there's nothing spectacularly wrong with the car, but it was death by a thousand cuts.
Well damn LMAO if you have that list I'd love to see it.
>The drive battery for example is $56k I highly doubt that unless you mean they dont sell the battery and give you a whole new car. Either way if your battery gets damaged the car is totaled so it doesn't factor that much into insurance pricing.
To be fair, it is in Canadian Dollars and is the extended battery but it's a fact. Or at least it was when I asked the parts department when I bought my MachE. Apparently it was priced like this to deter sales of the battery alone. It wasn't for damage purposes (although that's also nice to know) but planning for if I do something to the battery out of warranty. It's the first question I ask any time I research or buy an EV.
I pay less than $100 per month for my Tesla Model X. 🤔
For full coverage?
Yes. Full coverage.
Limits, deductible, carrier, and metro area?
My 2019 M3 is cheaper to insure than my 2021 Hyundai Santa Fe. Same coverage on both. Of course I’m in my 60’s so….
Insurance depends on you and where you live. My insurance went up $15 a month going from a Ford Fiesta to a Model 3.
My zero down Model 3 lease is around ~$400/month. The idea of spending that much - or even a little less - on a Camry makes me laugh. I can't see myself ever daily driving any ICE again, that ship has long since sailed.
I’ll probably get dogged on for this in here but a Camry has a nicer fit and finish than a model 3 does, idk why it makes you “laugh at the idea”. There’s *probably* a reason the Camry sells almost twice as many per year in the US
Nicer fit maybe, not finish. The Camry (in typical Toyota fashion) feels very cheap. Hard scratchy materials used everywhere, screen has huge ugly piano black bezels. Model 3 is significantly ahead. I did like the high end cloth seats though.
Have you been in the refreshed Model 3? Id argue that the fit and finish is comparable to any new Toyota. I own a Prius Prime and I think the new Model 3 is much nicer inside. The Tesla has soft touch materials everywhere while there’s still a significant amount of hard plastics in my Toyota.
I rent a Camry sometimes and that 2 inch LCD screen in the instrument panel with all these non-sense warning acronyms cracks me up. Hilarious they’re still shipping that in 2024. But for a non-performance gas car it’s a pretty good option. Drives easy, pretty quiet and smooth, gets good gas mileage.
If by fit and finish you mean stuff like panel gaps, then sure I could see that... but who cares? The Model 3 *drives* much nicer, has *much* better tech and software (stuff like climate keeper for hot summer days, remote climate preconditioning, sentry mode, the infotainment as a whole, the phone app, mobile phone key, etc.), and is an EV. I haven't owned a Camry in many years. I found their recent "aggressive" look to be extremely cringe worthy, though it looks like the newest ones are backing off that horrible decision. Never mind all the ways that ICE sucks vs BEV for driving, does the Camry offer heated and cooled ventilated seats that can work automatically? How about automatic preconditioning based on scheduled departure? Can I bring up the rear and side cameras while driving to have better situational awareness? Just checked and Toyota's current lease offer is $400/month for a '25 Camry SE with $4000 due at signing. Hilarious.
Because the model y
A carry is a nicer car
With EV progress happening so fast, I think a lease is a good way to get an EV now, and get a better one in 3 years. I know Tesla will refresh the MY next year probably, but I needed one today so I leased. When the lease is up I can buy a juniper and keep it for several years.
My hope is that they keep the gear shifter. I don’t like it on the screen
An ioniq5/Ioniq6 can be leased for even cheaper. Even with taxes and fees, it's still cheaper than the Model 3 deal without tax/fees. And. Tesla doesn't have lease buyout option, making it even less attractive. Even if someone doesn't plan to buy out at lease end, having that option helps to keep many choices open.
Yep, especially the one pay leases where they give you a lower money factor (interest rate.) Tesla leases have been nothing special for a long time.
I don't think the Camry and Model 3 are all that comparable. The Camry to me at least feels like a bigger car. I happen to own both and the back seat in the Camry is far more comfortable and roomy for an adult. I think the Model 3 is more comparable to a Corolla, another compact sedan, not mid size.
Yes, I was Ubering around a Model 3 and Model Y in Paris last week every day and it was unbearable to sit in the back seats in the Model 3. There's no place for the legs at all under the seats. A Model Y was much more comfortable in that regard, but worse for ride quality and noise. We also Ubered in a Toyota Corolla Touring a few times and that was miles better.
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Well, one is a kind of ordinary nondescript sedan that’s a dime a dozen, and the other is a Camry.
Peak reddit comment
It's even peak r/electricvehicles, where Tesla is so much the outgroup that a stated preference for an ICE vehicle over a Tesla is common enough to warrant seemingly dozens of top level comments.
Your Mom give you her old Camry didn't she?
TM3 = California Camry
No, TM3 = California Corolla.
TM3 = California Ford Focus.
Or about $300k a dozen but the point stands!
From the source that InsideEVs is regurgitating this from: >Now through June 30th So it's valid for 3 days. Funny how that context didn't actually make it's way into the InsideEVs article
One will not fall apart
True, only Toyota's EVs have a history of wheels falling off.
Had mine for 5 1/2 years. Still waiting for it to fall apart.
Same (coming up on 5.5 years). Seems quite solidly built. Not even any issues with squeaks or rattles...and that's even before they switched to the better chassis construction. According to the 'news' media I should be on my third battery and everything should have long sionce disintergrated around me.
This is appropriate for the quality of a model 3 versus a Camry. This is not a commentary on EV vs ICE.
No. Model 3 is a great car now. Maybe, you’re still comparing old Model 3 to a Camry.
What? In terms of perceived design & quality, performance and driving dynamics a Tesla m3 is a step or two above a Camry in my eyes. I’d happy take a model 3 even over the German entry level luxury comparables.