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Financing options?

electruck

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I too may need to pull my deposit. I have always leased my cars, this is very disappointing. I may get the Volvo Polestar 2, very reasonable lease payments and very good reviews. I would think Rivian will need to evolve their financing options.Waiting to get a test ride soon.
See my post from yesterday in the what-about-leasing thread. Options are coming, they just won't be available at launch. Who knows if they will come 6 months or 2+ years after launch though.
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I too may need to pull my deposit. I have always leased my cars, this is very disappointing. I may get the Volvo Polestar 2, very reasonable lease payments and very good reviews. I would think Rivian will need to evolve their financing options.Waiting to get a test ride soon.
Nothing preventing you from leasing the Rivian. Arrange the lease through a credit union or other finance company and they will cut a check to Rivian when you take delivery. Rivian gets paid and you get your lease.
 

My 1st Truck

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Do you know what credit unions will offer this? This is a new vehicle how do they determine the residuals and the factor?
 

DucRider

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Do you know what credit unions will offer this? This is a new vehicle how do they determine the residuals and the factor?
Found one link of a company offering leasing service to credit unions and posted it in another thread:
https://www.rivianforums.com/forum/threads/financing-options.652/post-15974

But I'll repost it here as well:
https://residuals.cula.com/vehicleresidualcalculator/consumer-lease.aspx
I ran numbers on a Polestar 2 using a credit union in NJ
If you can't find one near you listed on the site, you might be able to encourage one to get signed up.

Residual seems to be ~45% which is probably about right (the Polestar was 44% with a 36 month 15K mile per year lease). Teslas (particularly Model 3s) run a bit higher residual, but also no longer have the Fed Tax Credit that messes with the %.
Manufacturers can also tend to be a bit (sometimes a lot) optimistic when their financial divisions offer leasing. This means that often the buyout at the end of the lease is well above market value. Nissan would up offering up to $7K off the contractual buyout number for people to purchase some of their vehicles.
Money Factor will be at least somewhat tied to current interest rates (and your credit score of course).
 
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Cam

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New here. I also was really hoping for a lease option. Trying to find a third party leasing company. If its not achievable then I'll still purchase.
 

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DucRider

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Out of curiousity...
For those looking to lease, why?

The heavily subsidized leases - and super low payments - advertised to move some vehicles won't be available on Rivians (at least not in the near future).

Maybe I'm from a different school of thought, but if the lower payment often associated with leasing is the only way you can afford a particular vehicle, you're probably living over your means. You are literally always renting cars. Any idea that the lower payment saves you money is true only in the short term.

The last car my wife and I financed was in 1985, after that it was to pay cash (usually on a 1 or 2 year old vehicle with low miles).

It can make sense to lease an EV if the rate is "too good to be true" (the manufacturer usually needs the various credits associated with an EV sale). Right now, a local Hyundai dealer is offering the Ioniq EV (170 miles range) for $35/mo with $1,999 out the door costs (1st, month, tax, title registration, and all fees).
 

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Out of curiousity...
For those looking to lease, why?
I think it's just a way of hedging our bets on what the value of the vehicle is going to be in 3 years' time. If the residual ends up being lower than the going market rate for a 3 yo Rivian then you get to come out a little bit on top at the end if you want to keep the car or trade it in, which balances out the fact that you probably overpaid for the depreciation in the first 3 years. If they are optimistic and set the residual higher than the eventual market value, then you get to walk away from the lease knowing that you paid lower than your fair share of the depreciation. In my view these scenarios are at worst equivalent to financing and at best better than financing.

Edit: I should add, this is all assuming that Rivian hypothetically allows the customer to buyout the vehicle at the end of the lease, and doesn't pull a Tesla and say 'nah we're taking it back for our upcoming Adventure Fleet(r)(tm) program'.
 
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MReda

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I've leased a few of my own over the years, I have no issue with it in practice. Part of it is the subsidized lease offers - they can regularly be better than the financing deals on new, and any other cash back style offers for purchasing vehicles outright.

The last vehicle I leased, for example, had an insane residual, and as a result, the buyout price at the end was well above market value. I happily returned it. Even accounting for the cost of financing it, I was way ahead of the game. On paper, at least. It would actually have been better for me to buy out the lease and keep it for five more years. Or never have bought a new car in the first place.

I've also bought new vehicles outright, kept them for two years, and sold them for almost what I bought them for. Scarcity in the used vehicle market.

And I've bought plenty of used vehicles. I like when people lease vehicles because I like to buy the three year old lease returns. It pretty much guarantees a stock of available vehicles where someone else has paid for a large chunk of the depreciation. In a few cases, I've kept these wisely purchased vehicles for a few years, and still managed to take a bath on the resale for any number of reasons.

The point of this rambling - new vehicles will always be poor financial decisions, regardless of whether you lease, finance, or pay cash. I don't consider the R1T to be a good financial decision, but I'm getting one anyway. :)
 

Cam

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Out of curiousity...
For those looking to lease, why?

The heavily subsidized leases - and super low payments - advertised to move some vehicles won't be available on Rivians (at least not in the near future).

Maybe I'm from a different school of thought, but if the lower payment often associated with leasing is the only way you can afford a particular vehicle, you're probably living over your means. You are literally always renting cars. Any idea that the lower payment saves you money is true only in the short term.

The last car my wife and I financed was in 1985, after that it was to pay cash (usually on a 1 or 2 year old vehicle with low miles).

It can make sense to lease an EV if the rate is "too good to be true" (the manufacturer usually needs the various credits associated with an EV sale). Right now, a local Hyundai dealer is offering the Ioniq EV (170 miles range) for $35/mo with $1,999 out the door costs (1st, month, tax, title registration, and all fees).
I'm motivated to prefer leasing on this type of vehicle for a few reasons.

Carry cost is less like you mentioned. It has less to do with affordability vs a mentality of not tying up funds/building equity in an asset that will grossly depreciate. Cars are falling into the old saying "If it flies or floats, it's cheaper to rent". Next is a lease is a little easier for me to write off annually as compensation or work related as I'm a business owner. And lastly, if by chance there's a market to resell the Rivian at a premium I would consider flipping mine for a profit. In that scenario a lease also doesn't require the payment of sales tax up front which would increase the cost basis. Leases pay use tax on the monthly payment instead.
 

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skyote

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Cars are falling into the old saying "If it flies or floats, it's cheaper to rent".
I'm familiar with that saying as well, but a slightly different variation (there's a 3rd F). Curious whether it's a regional difference, or if you purposely edited.
 

ElectricDan

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I think it's just a way of hedging our bets on what the value of the vehicle is going to be in 3 years' time. If the residual ends up being lower than the going market rate for a 3 yo Rivian then you get to come out a little bit on top at the end if you want to keep the car or trade it in, which balances out the fact that you probably overpaid for the depreciation in the first 3 years. If they are optimistic and set the residual higher than the eventual market value, then you get to walk away from the lease knowing that you paid lower than your fair share of the depreciation. In my view these scenarios are at worst equivalent to financing and at best better than financing.

Edit: I should add, this is all assuming that Rivian hypothetically allows the customer to buyout the vehicle at the end of the lease, and doesn't pull a Tesla and say 'nah we're taking it back for our upcoming Adventure Fleet(r)(tm) program'.
I agree with most of this. I've planned on buying a rivian for the last 18 months, but I didn't pre order until after the Amazon investment. For me that gave me confidence that this company would survive.

I'm generally strongly against leasing. I've never done it in the past, and I've never thought I'd consider it. However in this situation I'd consider it for the following reasons: hedge your bets in the event the company doesn't survive, you're not locked into a first generation vehicle in the event there are some manufacturing defects/inconveniences, lastly, protects you from investing in a vehicle/technology that may become rapidly obsolete (technically speaking).

I think I'll still end up buying a rivian, im just concerned that in 3-5 years there may be a leap in battery or autonomy technology that will severely depreciate the value of this vehicle, to the point where the resale outlook is not favorable, while secondly, giving me a lot of jealousy for the 2nd generation technology present.
 

sevengroove

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I agree with most of this. I've planned on buying a rivian for the last 18 months, but I didn't pre order until after the Amazon investment. For me that gave me confidence that this company would survive.

I'm generally strongly against leasing. I've never done it in the past, and I've never thought I'd consider it. However in this situation I'd consider it for the following reasons: hedge your bets in the event the company doesn't survive, you're not locked into a first generation vehicle in the event there are some manufacturing defects/inconveniences, lastly, protects you from investing in a vehicle/technology that may become rapidly obsolete (technically speaking).

I think I'll still end up buying a rivian, im just concerned that in 3-5 years there may be a leap in battery or autonomy technology that will severely depreciate the value of this vehicle, to the point where the resale outlook is not favorable, while secondly, giving me a lot of jealousy for the 2nd generation technology present.
Yup - basically it's the curse of the early adopter :). EV technology is certainly going to advance in the next few years, Rivian's manufacturing prowess will certainly advance as well, they will learn from their (hopefully not critical) mistakes and make improvements. Their charging infrastructure will be wider spread. They will have a better handle on how to deal with maintenance. We will "miss out" on all those benefits as early adopters.

All that being said, I'm still getting one. There's nothing quite like the R1S on the EV market that blends off-road capability with other daily practical needs at this price point.
 

Coast2Coast

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I've been thinking a lot about the issues @sevengroove and @ElectricDan raise: what's a fair price for a Rivian, resale values, obsolescence, and, in my case, if I already have economical, reliable around-town and off-road vehicles, a Prius and 4WD, long bed Tacoma, why go through the hassle and expense of selling what I have and getting something new? My thought on these matters may be of interest to some folks on the forum.

1. Fair price for a Rivian. This is tough because there's really nothing out there that rivals a Rivian. The power, the ability to control torque, slip, yaw and ride at four corners, practical but tasteful design, on and off road performance, big enough but not so big, a preview of where the industry will likely go, and so on. There are really no comps, at least at present.

So how do you price vehicles like these? I think the LEs are priced a little high, but not egregiously so. Maybe 5-7% high but it's only possible to gainsay such estimates by comparing Rivians to existing ICE vehicles, and that's not really an apples-to-apples comparison. Indeed, since we're comparing zero emissions, incredibly performing trucks that don't look awful to ICE, so-so looking and performing trucks, the Rivians should probably be priced higher than they are. The prices seem fair and they may actually be "good" values.

2. Resale values. Impossible to know and hard to estimate. Resale values will depend on reliability, longevity and what sort of cache, if any, Rivian vehicles gain in the years ahead. If I was building a spreadsheet, I'd probably make optimistic and pessimistic assumptions and believe the outcome will fall in the middle.

3. Obsolescence. Batteries are only going to get better and pretty soon. 2-3 years down the road, 400-500 mile range trucks will be available. Will they make 300-400 mile Rivians obsolete? No, not at all. For most of us, 300-400 miles of range is enough. For those where it's not the case, they can trade in their 2021-22 Rivians for 2023-2024 models. First generation Rivian batteries will likely be serviceable to the end of the decade. That's more than good enough for most of us. For the rest, buy now and expect to trade in or wait a few years before buying.

4. The hassle and expense of trading in. In my case, this is a tough decision because my Prius gets 47 mpg and my Tacoma, with a TRD supercharger, performs really well. But even adding together their qualities do they equal a Rivian? No, I don't think so.

On the other hand, giving up two reliable, paid for and serviceable vehicles for an unknown future with Rivian does give me pause and, in saying this, I circle back to pricing and value questions. I don't think the price premium on Rivians is too high and do think they'll hold their value fairly well, so I'll likely go through with a LE purchase, especially if Cox Automotive or some other Rivian affiliate can make it easy to deal with the hassle and expense of trading in.

No compromise, on-road & off-road performing, zero emissions, well designed, fair priced BEV trucks are game changers, as Emme Hall said after driving a R1T in the Rebelle Rallye.
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