Buy after Leasing Model Y?

[scotty2hotty]

Good morning everyone, I am thinking about leasing a model Y and would likely want to lease for 3 years before buying. What are the chances that I would get a 3rd party dealership to buy it after my lease so that I could buy the vehicle?

 

[azentropy]

Nope, it doesn't work that way. You may have the option to have a 3rd party buy a vehicle from Tesla then lease it to you with the option to buy it from the 3rd Party after the lease. I know a few 3rd parties were leasing Tesla's before Tesla started doing it themselves. But of course at a premium.

 

[Hovscorpion1]

Hello. Model Y and model 3 are not eligible for lease purchase. Only the Model S/X can.

 

[imola.zhp]

Not sure of your time frame but there have been rumors that Tesla will change their leasing programs this year. The rumor started last quarter and said it would be Q1 2021 but Tesla rumors are often incorrect with their timing. Part of that rumor is that the terms will change which will allow you to buy your vehicle at the end of your lease.

Only time will tell but if you can spare a few months maybe the rumor will become true and perhaps happen in Q1.

 

[MrTuna]

If you are looking to lease and then buy... what is the upside in your mind?

Easy path to sell in 3 years in case you don’t like? Because in the US you can sell the car to someone online like carvana in like 30 minutes for way more than your residual will be.


Tax benefits? Leasing vs buying has no tax implications for most people in the US. Ask your accountant what the difference will be of lease vs car payment.

???? something else? Can’t really see any logical or financial upside to lease but I see many downsides.

 

[DaveORD]

If for a business use case, would leasing be better, tax write off vs if they purchase?

 

[MrTuna]

If for a business use case, would leasing be better, tax write off vs if they purchase?

my accountant says it doesn’t matter for me. Worth asking. A lot of tribal knowledge around leasing that isn’t actually true anymore.

 

[DaveORD]

my accountant says it doesn’t matter for me. Worth asking. A lot of tribal knowledge around leasing that isn’t actually true anymore.

Yep. Most of the companies I have worked for, including my current, have leased their equipment vs buying, that includes computers, office equipment and vehicles. I do not get involved in those aspects of the business but there must be some reason why they do it that way vs purchasing. Only way to know for sure is to discuss with your accountant.

 

[David.85D]

As a long term S owner, I’ve wondered who ends up with the loss when the residual value post lease turns out to be much less than expected.

Continuous price drops on new cars and added features have got to hurt.

After getting burned, I bet the usual leasing players don’t want the extra risk unless Tesla guarantees the residual value, which they probably don’t want to do...

one more thing Tesla is disrupting. Maybe without wanting to...

 

[frankvb]

One advantage of leasing is that if you have an accident, there is no diminished value problem. And obviously you don't have a risk of the value being much lower than expected at the end of the lease.

On the other hand, as an example BMW had very high residual values (over 60%) so buying the vehicle at the end of the lease would be a waste of money, as the real value was much lower at that point.

 

[seniorcitizen]

I was about to lease for my business I learned that we cannot buy at the end of lease term. I wanted FSD, I wanted snow tires etc. I did not want to invest so much in to a car I could not buy.

I also found that model 3 resale value was incredibly high. I plan to keep the car for a long time but even if I decide to get rid of it I may come out ahead in a lease. MY GVWR is less than 6000 lbs so the depreciation in the first year is only $18000.

As a result of these factors I ended up buying the car.

 

[2101Guy]

Yep. Most of the companies I have worked for, including my current, have leased their equipment vs buying, that includes computers, office equipment and vehicles. I do not get involved in those aspects of the business but there must be some reason why they do it that way vs purchasing. Only way to know for sure is to discuss with your accountant.

short version: Leasing a vehicle is opex vs capex

• Opex are entirely tax-deductible. Therefore it is more attractive for a company to lease an item and assign its cost to operating expenses rather than purchase it.

 

[angus[Y]oung]

As a long term S owner, I’ve wondered who ends up with the loss when the residual value post lease turns out to be much less than expected.

The company that leased it to you would be left short in that case. This is why you will generally see manufacturers being relatively conservative when setting their residual rates for their leasing programs. There are exceptions of course if they are trying to aggressively push a vehicle (new vehicle trying to gain market share at any expense, that type of thing), but generally they are conservative. Even if they lose money on the residual value in the end, it may be at least partially offset (if not completely offset with profit left over) by the interest paid, and they can generally play with these two numbers (interest rate and residual value at end of lease) to try to maximize the odds of making money off at least one of them, or to take a small haircut if they really want to move units.

 

[ACepero]

Hello. Model Y and model 3 are not eligible for lease purchase. Only the Model S/X can.

That's not exactly true: