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Leasing a Y

GeorgeC1

Member
Jun 2, 2020
150
85
NC
I am not a big lease person but currently have a I3 on lease that will be returned in 8 weeks. Trying to evaluate the Tesla lease options but they don’t provide needed information on the website like money factor and end of lease buy out options. Do you have to commit to the lease to get the details?
 

Eric9610

Member
Sep 4, 2020
66
72
So Cal
I Just leased A MY LR with 20’ rims and it is very competitive. The only way to get the details is to place a reservation then select the lease option and it will give you 100% what you will pay per month including tax.

also you are not able to purchase the MY after the lease. This is also the case with M3 as all the lease cars are slated for the Robo taxi service at lease end.
 
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Eric9610

Member
Sep 4, 2020
66
72
So Cal
@GeorgeC1 you will learn Tesla says a lot of things that may or may not happen. EX: Elon said no SR Y yet Tesla is now listing it on the site.

I would not hold my breath on Tesla letting you buy at EOL. Maybe Q3 this year. Also I think the total cost will be higher if you go this route vs buying new.

The only reason I leased vs purchased is I want the Tri-motor Cyber truck and needed a car now.
 

hakunamattata

Member
May 28, 2020
144
55
New Jersey
That is correct as of today you cannot buy the car at the end of lease. Just for your reference the money factor for LR AWD last month was 0.002019 and the residual value was 65.5348% for 36,000 miles
 

TespaceX

Member
May 1, 2020
451
677
CA
@GeorgeC1 you will learn Tesla says a lot of things that may or may not happen. EX: Elon said no SR Y yet Tesla is now listing it on the site.

I would not hold my breath on Tesla letting you buy at EOL. Maybe Q3 this year. Also I think the total cost will be higher if you go this route vs buying new.

By your reasoning, robotaxis may or may not happen and your reason for why Tesla won’t allow purchase at lease end may or may not be true.

Given that leases on the 3 began early 2019, Tesla would have only a little more than a year now to start their robotaxi service unless they want a pile of used 3’s sitting around. Highly unlikely.
 

GeorgeC1

Member
Jun 2, 2020
150
85
NC
By your reasoning, robotaxis may or may not happen and your reason for why Tesla won’t allow purchase at lease end may or may not be true.

Given that leases on the 3 began early 2019, Tesla would have only a little more than a year now to start their robotaxi service unless they want a pile of used 3’s sitting around. Highly unlikely.

I suspect model 3 resale values will take a serious hit when all those lease returns start happening.
 
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Nov 3, 2019
225
242
Green Valley AZ
Wife and I leased our MY (picked up Nov 7th). Never leased before. We had the cash to buy the car outright but as the technology is changing so quickly thought it prudent to "dip our toes" in the water first. Also we were concerned about the quality control issues we've read about.

Well, the car we leased is a real beauty! No issues whatever. Great paint job even! So, we will buy this MY at the end of the lease if that is allowed.

Our decision to lease was not based on financial issues, but for the other reasons I mentioned. We still think we did the right thing.

Rich
 

GeorgeC1

Member
Jun 2, 2020
150
85
NC
Wife and I leased our MY (picked up Nov 7th). Never leased before. We had the cash to buy the car outright but as the technology is changing so quickly thought it prudent to "dip our toes" in the water first. Also we were concerned about the quality control issues we've read about.

Well, the car we leased is a real beauty! No issues whatever. Great paint job even! So, we will buy this MY at the end of the lease if that is allowed.

Our decision to lease was not based on financial issues, but for the other reasons I mentioned. We still think we did the right thing.

Rich

I am thinking exactly the same as you are. It was also the reason I leased the I3. My 55,000 I3 has a lease payment of 319 a month with 3500 to start the lease so the Tesla numbers do seem high. I do understand BMW subsidized the leases as the I3 was a compliance car however interest rates were higher back then.
 

hakunamattata

Member
May 28, 2020
144
55
New Jersey
I am thinking exactly the same as you are. It was also the reason I leased the I3. My 55,000 I3 has a lease payment of 319 a month with 3500 to start the lease so the Tesla numbers do seem high. I do understand BMW subsidized the leases as the I3 was a compliance car however interest rates were higher back then.

Yes I totally agree that interest rate for Tesla leases are higher, I maybe wrong however I am assuming your BMW i3 qualified for the Federal tax credit of $7500 which brought your monthly payments down significantly. Tesla's don't qualify for federal tax credit anymore. Some of the legacy car companies just show this amount and lease credit and it appears as subsidy in the calculations.

I leased my Model Y for the same reason RichAZ mentioned i.e. technology and EV car landscape changing constantly and who knows what it will be in the next three years. I took the money I saved leasing it and hedged against TSLA stock and have no regrets for it.
 

hakunamattata

Member
May 28, 2020
144
55
New Jersey
That is my point, when comparing leases you can't just go simply by one variable i.e. money factor or residual value. You have to factor every aspect which contributes towards the monthly payment i.e.

1. MSRP
2. Money factor (interest rate)
3. Residual Value - Price of the car at the end of your lease term
4. Down payments you make
5. Rebates/Credits
6. Discount offered by the dealers
7. Taxes (Are they paid upfront or rolled over into a lease)

Yes Tesla's money factor is higher, but then the residual value is also higher i.e. 65% after 36,000 miles vs 57% for BMW i3. There is a reason for the money factor to be higher as Tesla is relatively new. As mentioned in earlier posts Model 3 just started leasing in 2019. The banks which provide the money to Tesla are going with a best guess with the residual value as there isn't a large dataset of resale values, which in turn it means it is a riskier financing for them hence higher interest rate. In the end the banks need to recover the amount of money they financed.

With legacy car companies the banks have a long term relationship and there is room for a lot of financial engineering there.
 

Eric9610

Member
Sep 4, 2020
66
72
So Cal
My dad has an I3 and with the same money down I put, drive offs only our payment delta is only $95 more for the Y. So in reality the BMW would cost more if the Y had the same $7500 advantage.

For everyone wishing to buy the Y at EOL if it is not clearly stated in your contract that you can purchase the car for xxxx price Tesla will not amend the contract. This has been confirmed by Tesla finance and friends with current 3 leases.

If you want to buy at EOL I would wait till the terms state such option.
 
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Kofther

Member
Apr 10, 2020
72
61
Los Angeles, CA
I leased and re dived this email from Tesla.


Tesla's New Leasing Experience
In the next few months, Tesla is moving the lease experience to your Tesla Account. Here's what you need to know:

New Place to Pay
You can conveniently make payments and enroll in Autopay within your Tesla Account.

New Management Options

Your Tesla Account will be your destination to conduct other actions including:
  • Extending your lease
  • Transferring your lease
  • Purchasing your car
  • Selling to Non-Tesla Dealers
  • Reporting a Total Loss
  • Requesting an Early Lease Termination
Launch Date

We're launching this experience early 2021. You will receive more information when we get closer to your launch date. No action is required at this point.
 

DanCar

Active Member
Oct 2, 2013
1,823
1,524
SF Bay Area
Because of the expected high resale value of Y, often near new price, for short term ownership it is cheaper to buy and sell than lease. There is an added advantage that you can sell when you want to and don't have to abide by lease terms.
 
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MP3Mike

Well-Known Member
Feb 1, 2016
15,324
33,239
Oregon
I leased and re dived this email from Tesla.


Tesla's New Leasing Experience
In the next few months, Tesla is moving the lease experience to your Tesla Account. Here's what you need to know:

New Place to Pay
You can conveniently make payments and enroll in Autopay within your Tesla Account.

New Management Options

Your Tesla Account will be your destination to conduct other actions including:
  • Extending your lease
  • Transferring your lease
  • Purchasing your car
  • Selling to Non-Tesla Dealers
  • Reporting a Total Loss
  • Requesting an Early Lease Termination

I suspect that was just a generic email talking about the general changes they are making. You will be able to do all of those things if your lease supports it. S&X leases support purchasing your car, 3&Y do not.

Tesla packages the leases and sells them, so they don't own them any more and most likely can't change the terms even if they wanted to.

Maybe you can find a non-Tesla dealer that will buy the car from you and sell it back to you at a slight profit.
 
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hakunamattata

Member
May 28, 2020
144
55
New Jersey
I agree this is a generic email and they are consolidating portals. I leased my model Y in December and now everything is under tesla.com vs having a separate account for scheduling payments and viewing the monthly statements
 

LV1972

Member
Nov 25, 2020
91
-18
henderson
Wife and I leased our MY (picked up Nov 7th). Never leased before. We had the cash to buy the car outright but as the technology is changing so quickly thought it prudent to "dip our toes" in the water first. Also we were concerned about the quality control issues we've read about.

Well, the car we leased is a real beauty! No issues whatever. Great paint job even! So, we will buy this MY at the end of the lease if that is allowed.

Our decision to lease was not based on financial issues, but for the other reasons I mentioned. We still think we did the right thing.

Rich

If your vehicle needs repair how Tesla will handle that? Will they give you loaner ?
 

TespaceX

Member
May 1, 2020
451
677
CA
I suspect model 3 resale values will take a serious hit when all those lease returns start happening.

It will depend on how Tesla prices their used inventory 3’s at that point in time. More likely than not I think value of the 3 will continue to go down. Many Y buyers appear to also be moving up from the 3.

It’s funny to see people trying to sell their 3’s privately, especially when they’re pricing in the FSD option. If one wants a used 3 right now with FSD, buying from Tesla is the best price hands down. When I look at the classifieds, people are trying to sell used 3’s without FSD for about the same price Tesla is selling used 3’s with FSD.

If Tesla were to provide an option to buy out at lease end, I can’t imagine them giving a good offer.

At this time, for anyone wanting a new car, I think it’s better to lease a 3 and buy a Y. The Y’s are so in demand. Tesla has very few used Ys, if any sometimes, and the Y’s are selling privately for not much less than new. Could change over time. But, at least for now, one could likely end up better by buying new, test it out for a year, and then sell it.
 

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