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Newbie seriously considering leasing UK - sense check

Since max time for the loan is 6 years, you expect to pay off at least half of the car value after 3 years.

With let's say 4000 deposit, your LR (cash on the road 57k) monthly payment on PCP is 1034 (3 year 15000 miles pcp deal) and you optional payment is 22k

Tesla Loan is 53k at the same deposit and same car. Monthly payment is 837 (72 months or 6 years) and after 3 years your remaining credit will be 26k

7200 of payments in 3 years difference, so in 3 years you are like 4000 worse in PCP :/

Lease imho is worst. You pay shitloads and in the end have absolutely nothing:/

You really need to use PCP for 48 months and a larger deposit to gain the benefit with Tesla, for your 15k/year example the PCP and loan are both £743/month with a £10k deposit and the PCP monthly figure goes down slightly more if that's increased because the GFV doesn't change with larger deposits.

As usual with finance you have to look at your own numbers and requirements then decide what is the better option for you in each individual case. Tesla are a little odd in that they offer significantly different interest rates for PCP and Loan and their GFVs seem pretty conservative (almost £10k less than other manufacturers would set for a similarly priced vehicle).

I agree with you about lease though, for private customers it really feels like the monthly numbers are way too high.
 
Hi, just to add to this, hope the OP doesn't mind.
I'm able to get a lease through work salary sacrifice which will cost me about £520 a month net inc maintenance, insurance etc. For about 7500 miles a year.

The thing is I have nothing to compare against on approx value of the car in 4 years so difficult to work out if a private PCP / purchase would actually be better ?

Any advice ?
 
Hi, just to add to this, hope the OP doesn't mind.
I'm able to get a lease through work salary sacrifice which will cost me about £520 a month net inc maintenance, insurance etc. For about 7500 miles a year.

The thing is I have nothing to compare against on approx value of the car in 4 years so difficult to work out if a private PCP / purchase would actually be better ?

Any advice ?
Tesla PCP would have your GFV as 37% of the original price at the end of four years.

It's pretty difficult to know if that would be about right or significantly above or below the actual second hand value of the vehicle at the moment, particularly as the prices are crazy at the moment.

I'm just about to change my M3 that I took delivery of in December 2020 and Tesla are offering me about £100 more than I paid for it - although it did qualify for the plug-in grant at the time, so that's technically around £3k less than the original list price.

So in my case I put down £7k deposit and having paid around £10k since I bought it, I will have roughly £13k in equity towards my new one meaning it's actually cost me about £350/month and my new one will end up being about £70/month less in finance payments - actually slightly less than your monthly lease payments but I have to pay for maintenance and insurance of course.
 
You really need to use PCP for 48 months and a larger deposit to gain the benefit with Tesla, for your 15k/year example the PCP and loan are both £743/month with a £10k deposit and the PCP monthly figure goes down slightly more if that's increased because the GFV doesn't change with larger deposits.

As usual with finance you have to look at your own numbers and requirements then decide what is the better option for you in each individual case. Tesla are a little odd in that they offer significantly different interest rates for PCP and Loan and their GFVs seem pretty conservative (almost £10k less than other manufacturers would set for a similarly priced vehicle).

I agree with you about lease though, for private customers it really feels like the monthly numbers are way too high.
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I think for me numbers show that loan is better :/
Not only your monthly payments are lower, representative APR is better, but at the end of your contract your total amount payable is lower anyway. not saying that in both ways you can trade in earlier and you have no additional fees if you drive more than 15k a year.

especially in my case, where I estimate ~20k a year, PCP just doesn't add up at all.
 

Wattsisname

MY Red/White/Gems EDD over the rainbow somewhere
Jan 12, 2022
1,163
576
Wandsworth London
You really need to use PCP for 48 months and a larger deposit to gain the benefit with Tesla, for your 15k/year example the PCP and loan are both £743/month with a £10k deposit and the PCP monthly figure goes down slightly more if that's increased because the GFV doesn't change with larger deposits.

As usual with finance you have to look at your own numbers and requirements then decide what is the better option for you in each individual case. Tesla are a little odd in that they offer significantly different interest rates for PCP and Loan and their GFVs seem pretty conservative (almost £10k less than other manufacturers would set for a similarly priced vehicle).

I agree with you about lease though, for private customers it really feels like the monthly numbers are way too high.
For some reason, on a three PCP deal, which I favour (I've also stopped buying green bananas) the max deposit Tesla allow on a £61, 590 cash price is £18,447. Also, 10,000 per month is the minimum mileage for their calculations. Also, the residual/final payment is quite low at 3 years namely £25,250 which means the monthly payment is £636.

Back in the day when HP for cars was still fairly novel, people were just so keen to get the motor that they did not give much thought to the (flat) interest rates. The important bit was the monthly payments which were never advertised with the cars - as one sees nowadays.

So, the dealer, after a a short battle ( "are you trying to bankrupt me sir") would give in to the customers' sale price negotiations if he knew they were financing through him. He would then quote the monthly payment and the customer would sign the agreement. In fact, the dealer would have calculated a repayment which would generate a settlement from the HP company equal or more than the original sticker price).

Having said that, I have been a cash buyer for many years and have found this current exercise quite interesting. Leasing, for retired private individuals, seems a bit of a mugs game. However, although flat and APR rates are quoted for the PCP deals, I can't make the numbers agree with the rates/periods. So, I guess it's never changed in its opacity, except maybe for C.A.s and the initiated, although regarding the latter, I am not sure the sales agents understand how "computer" arrives at the numbers.

Therefore, go compare, in the generic sense, and choose what seems closest to your needs because.... it is what it is!
 

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