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Ordered 90D. 2yr Lease vs 3yr Lease or Loaning?

Discussion in 'Model S' started by ichospitalist, Aug 26, 2016.

  1. ichospitalist

    ichospitalist Member

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    Hi all!
    I have ordered a 90D and opted to choose a showroom car that perfectly matched my specifications, only about 100 miles, saving 11K in the process. Question that may have been asked is whether it's better to lease 2yr, 3yr or loan? I was leaning leasing because I'd like to have something new in 3 yrs. My last car was a leased Audi cabriolet and I'm glad I leased. I am pretty busy at work so i noticed that with the Audi i dont really drive over 10K mi per year. Price wise the 90D is about 92K with incentives deducted. I'm just curious as to the reasoning for Tesla to offer 2yr leasing and wonder if it has to do with the upcoming Model 3.
    While I'm excited, I have never had an EV before and not even a hybrid. Thanks again and any tips both financial and using the car are much appreciated.
     
  2. dss33

    dss33 Member

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    Congrats - you're going to LOVE it!

    That's precisely why they offered the two-year. If I were you, I'd go with the three-year lease. Tech and the general automotive landscape is changing so rapidly now and in three years, you can either stick with your S by buying it out, pick up a 3, or maybe even a Y. The point is, the three-year makes a lot more sense, financially (compared to the two-year) and that's just about enough time for Tesla to have sorted out the 3 and to have way more out there about the Y, the minibus, the pickup - who knows. It's going to be an exciting few years.
     
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  3. goofygrin

    goofygrin Member

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    Leasing is a good idea for two reasons. One you get the 7500 up front (to the leasing company). Two, these cars are shedding value quickly and you let Tesla roll the dice on the value of the car in 2-3 years when the model 3 is released and tech has changed a ton.
     
  4. beero-rad

    beero-rad Member

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    If you plan on selling your car in a few years, leasing is usually a good idea, but you have to take into account the low finance rates currently offered...resale value of model s's has been some of the best if not the best in class. obviously it's personal choice, but you should take a long hard look at financing...
     
  5. goofygrin

    goofygrin Member

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    Lease depreciating assets...

    Only car I've ever made money on was an air-cooled turbo Porsche.
     
  6. xav-

    xav- Member

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    Ask for two years and three years quote and compare.

    If you are not planning to keep I would for sure go with the lease. Especially considering the reliability problems the lease is really good idea. Ask then for 2 and 3 year quote and see what's cheaper per month (including of course down payment fees etc)
     
  7. ggnykk

    ggnykk Active Member

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    I think 2 years lease is the best option. Remember that this is also a limited-time option that will last until mid-September. After 2 years, you can buy the cheaper Model 3.
     
  8. davidc18

    davidc18 Member

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    Looking at the 2 year lease on an MX. Same questions. Good discussion.
     
  9. ichospitalist

    ichospitalist Member

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    One question though, I see that there is a down payment in the lease... is there any option not to have a down payment, or just spread it out to the payments? The 1000 and 2500 fees already add on top of the down payment, so that's technically a lot of money.
     
  10. goofygrin

    goofygrin Member

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    Normally you want to put as little down as possible on a lease.

    Apparently you can ask for a lower down if you have good credit, but they still want you to have skin in the game
     
  11. Chaz

    Chaz Big Kahuna

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    On a lease, you are required to pay the first month's "rent" plus applicable sales taxes for your zip code. And googygrin is right, pay as little a down payment as they will let you for a lease.
     
  12. xav-

    xav- Member

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    When you lease it's really nice to have discounts. The problem with the X is I don't believe there are any discounts available. To that you add the fact that tesla has poor residuals and high interest rate. On a "plus" side with all the headaches with the FWD doors etc.. Maybe leasing makes a lot more sense?

    On the model S P90Ds there are some heavy $31k discounts. I was offered $783 with CA taxes a month on Friday on a demo model with under 5k miles. Down payment was $6k with $8.5k due at signing. $142,700 MSRP.

    it was something like $27k after 2 years. A lot of money for us so not going forward with it. That was a killer deal for a lease however.
     
  13. Jeff4155

    Jeff4155 Member

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    I find it very interesting how many people lease vehicles in the US, this is something very few South Africans tend to do, our interest rates are just to high and our second hand market is very good, so we tend to keep our cars for a lot longer and buy not lease.
     
  14. ichospitalist

    ichospitalist Member

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    Ok, so I just got the quotes from Tesla, 2 year lease vs 3 year lease vs loan for my mid 2016 S90D souped up (floor model w/ 500-600 miles, range 284, with tan leather, blue color, high fidelity sound, subzero package, suspension, premium package and autopilot) for a cash value of 92K.
    Between the lease and loan, it appears there is a 20K difference between the total value of the car if one decides to buy after the lease versus loan outright (115K for 2 yr loan, 118K for 3 year loan and 96K for loaning.
    Proposed down similar for 2 yr and 3 yr about 7-8K. Less for loan of course.
    2yr and 3yr leasing versus 2 years or 3 years respectively of loaning, there is a difference of around 8 to 10K of money already spent.
    What do you think guys? Really need help on this one.
    image001.png image002.png
     
  15. Chaz

    Chaz Big Kahuna

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    #15 Chaz, Aug 30, 2016
    Last edited: Aug 30, 2016
    I forgot to mention that last year, during fourth quarter (presumably the slowest quarter), Tesla offered up to a $100/month "discount" on new leases. For my configuration, it was about $65/month. There are never any guarantees, but it could happen again. I do not take delivery until December, so I'm hoping! :D

    If you are sure you will want something new in three years, and no chance you'll want to buy out after your lease ends, I say go with the lease. Like most things relating to a Tesla purchase, it boils down to your personal/financial preferences.

    I personally hate large down payments or financing over 48 months, because I, too, like to get something new after about three years. So I will probably lease. This also prevents me from having to sell the car myself, or getting a low-ball "dealer trade-in" value in three years. Not that I couldn't sell it myself, but I'd rather not have to deal with it.

    Also, I'm only putting down $1000 (plus $2500 deposit already paid). Over the life of a three-year lease, the difference in the monthly payment with a higher down payment ($6000 + $2500 deposit) comes out about the same in my situation.

    Either way, you will be more than happy with your new MS! Good luck and congratulations!
     
  16. ggnykk

    ggnykk Active Member

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    I really think the 2 year lease is the best deal. Then you can get a Model 3 with more range at even lower costs at the end of lease.

    Don't worry about the 115k or 118k buy-out costs at the end of the lease, because you WON'T do it. In 2 to 3 years, 120D would be out already at that time, and it would be absolutely stupid that you spend 115k at that time to buy back a 90D.

    There is a reason why lease ("cost over 24 months or 36 months") is more expensive than loan, because you are essentially paying a little more premium to Tesla, so that you are offloading the risks (of the car being seriously outdated) to Tesla instead of on your side of the court. Also, Tesla will take on the risks of selling the 90D themselves after you give it back to them at the end of lease. Battery and technologies are changing very fast nowadays.
     
  17. ichospitalist

    ichospitalist Member

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    I agree. I have decided to do a 2 year lease. I want to be an EV owner some day and my criterion is to have a battery that allows the range of 450 miles, just like the range of my Audi cabriolet. That way I know I will have to stop on a 400 mile trip anyway and that's a good time to supercharge. I fully understand that leasing is NOT going to save me money. With the 100 kwh out, it is just a matter of time when a battery will come out with a range of 400 miles. And knowing Tesla, I don't think they prefer battery swapping on existing cars and would simply churn out a better model every year to take advantage of the battery. When the range is acceptable, then I can consider financing the car.
     
  18. ggnykk

    ggnykk Active Member

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    Good for you.

    400 miles? You need 120D or better to achieve that.
     
  19. ichospitalist

    ichospitalist Member

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    Sad to say I had to finance it. Leasing was not an option because I am still in Iowa for 3 months and Iowa does not allow registration to Iowa. If I wait 3 months, then I lose this great deal. Basically a blue S90D tan leather, autopilot, high fidelity sound, sub zero package, air suspension, panoramic glass with the new facelift and only 500 or so miles... for 92K. Iowa hates Tesla, so insurance rates are double. Looking at Tesla inventory, the 90D s are selling like hotcakes. So frustrating but leaving Iowa anyway.
     
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