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Donald Stanfield

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There actually are standards for car condition at lease end. Whether they are reasonable or not is a matter of opinion. Here is a link to standards posted by a BMW dealer: https://www.bertsmithbmw.com/lease-end-inspection.htm.
The one that trips people up the most is tire wear. It's no fun to buy new tires for someone else. Also, a dealer's excitement to enforce those standards can be affected by the customer's desire to lease again from the same dealer.
Even in your link read the standards. Under acceptable is "minor" wear and tear. That's subjective not an objective standard. Tire wear might be more heavily enforced on customers who have other issues that fall into subjective categories because often times its too difficult to enforce subjective standards on people who will argue with you all day long the scratch is minor
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Even in your link read the standards. Under acceptable is "minor" wear and tear. That's subjective not an objective standard. Tire wear might be more heavily enforced on customers who have other issues that fall into subjective categories because often times its too difficult to enforce subjective standards on people who will argue with you all day long the scratch is minor
You are right that subjectivity remains, but the standards put some guardrails on it. It does say scratches that go through the paint are unacceptable; scratches that don't are. Plus, dents that fit in a 2" circle are acceptable, those that don't aren't. For the interior, you can't have burns or tears, but scratches are okay. When you trade in a car or sell it, the condition matters in that transaction as well. Having a beat up car costs you in either case.
 

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Leasing depends on your situation and the deal you get on the lease. Many people who use the vehicle for work, can write off part of the lease on their taxes.
And many businesses prefer to lease so that it is a pure business expense rather than a capital investment that has to be be depreciated on the books.
 

SurfnBike

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I am noting how those advocating for leasing have not provided any hard numbers.

We as humans are more emotional than we are rational. We drum up in our minds what we feel and then use logic to rationalize those emotions.

Until someone provides some hard numbers, I say you're still paying more to lease any vehicle, EV included, because as others stated, leasing companies are for-profit, and dealers/manufacturers, which are also for-profit, encourage leases, and want to add them as a purchase option to drive sales.

If you are comparing buying outright (no tax credit) with leasing (with tax credit) then we be onto something. But the details matter! From my understanding some leases charge you 50% of the vehicle over the term. The tax credit meanwhile is only about 10% of the purchase price.
 

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I like my cars like I like my women… newer model every 3 years 😉 so yeah I’d be all in on leasing a Rivian if able.
 

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R1Tcali

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As a former CFO and corporate accountant, businesses definitely use vehicle leases as a tax advantage. Depends on the business and how different costs are accounted for.
One company I worked for, leased several Volvo trucks, all the maintenance was covered by the dealer. There are way too many what ifs to make blanket statements one way or the other.
As an individual it depends on lots of factors, primarily residual and we have no idea what that number is right now.
 

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Those fee's do not make up the value of the cash.
$60,000 60 month loan at 6%, after 36 months you've paid $7930 just in interest. On a 3y lease that's an extra $220 a month. Obviously we don't know what Rivian is going to use as their residual values yet, but I'm guessing that it's actually going to end up being a better deal to lease with loan interest rates being so high right now.
 

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I am noting how those advocating for leasing have not provided any hard numbers.

We as humans are more emotional than we are rational. We drum up in our minds what we feel and then use logic to rationalize those emotions.

Until someone provides some hard numbers, I say you're still paying more to lease any vehicle, EV included, because as others stated, leasing companies are for-profit, and dealers/manufacturers, which are also for-profit, encourage leases, and want to add them as a purchase option to drive sales.

If you are comparing buying outright (no tax credit) with leasing (with tax credit) then we be onto something. But the details matter! From my understanding some leases charge you 50% of the vehicle over the term. The tax credit meanwhile is only about 10% of the purchase price.
Numbers are absolutely important but we don't have any details of any potential lease agreement from Rivian. It's not always going to be better one way or the other so you have to do the math when it comes time to compare a lease vs financing.

Like you said though a near 10% reduction in capitalized cost could be a big difference. One big advantage of a lease otherwise is you have an option at the end to buy it for an agreed upon price or turn it back in, with a loan you have what you have so it's a gamble in some sense for resale value. Beyond that lots of compelling reasons stated above either one way or the other depending on a given buyers needs.
 

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$60,000 60 month loan at 6%, after 36 months you've paid $7930 just in interest. On a 3y lease that's an extra $220 a month. Obviously we don't know what Rivian is going to use as their residual values yet, but I'm guessing that it's actually going to end up being a better deal to lease with loan interest rates being so high right now.
These same interest rates are built into the lease. Essentially you are taking out a loan for the portion of the cars depreciation you are going to use over the term of the lease. Money was essentially free for the last 10 years so lease payments were low but they will be higher now that the interest rates are higher.
 

SANZC02

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Numbers are absolutely important but we don't have any details of any potential lease agreement from Rivian. It's not always going to be better one way or the other so you have to do the math when it comes time to compare a lease vs financing.

Like you said though a near 10% reduction in capitalized cost could be a big difference. One big advantage of a lease otherwise is you have an option at the end to buy it for an agreed upon price or turn it back in, with a loan you have what you have so it's a gamble in some sense for resale value. Beyond that lots of compelling reasons stated above either one way or the other depending on a given buyers needs.
Very important to know who you are leasing from as well. A buddy of mine leased an Infinity for 3 years, when he went to turn it in they wanted to charge him 7k in mileage overages and “excessive wear”. He ended up purchasing the car and sold it to Carmax for $500 less than he paid for it.

Lesson here is know your numbers before turning the car back in.
 

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Actually, leasing EVs are a very good idea.

Given the state of battery technology and the nature of EVs (rolling laptops), as well as product improvements overall in a new EV companies, two to three year lease shields from owning an outdated or older generation vehicle.

It is not about lowering monthly payment. It is about now being stuck with outdated equipment within a relatively short period.

In terms of finance, there are many instances where leasing makes much more sense than buying and owning it. To say that only poor people lease because they cannot afford the payment is ridiculous.

Glad Rivian is considering leasing option.

I did not finance my R1S. It's fully paid using idle cash earning money market interest, which is less than loan rate these days. So I just bought it outright. I would have leased the vehicle if that was an option at the time.
Pay the man!

When I offer advice to people about EVs I encourage them to lease because battery technology is rapidly accelerating and increasing the risk of significant depreciation.

The alternative argument is if the vehicle you are thinking about purchasing meets your needs today, and tomorrow and you plan to keep it for 10 years, then go ahead and buy it.

With vehicles like the R1T and R1S that have no reliability history, and given the potentially high cost of out-of-warranty repairs, leasing makes a lot of sense on a lot of levels, especially considering that Rivian does not offer an extended warranty.
 

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Coming from the auto industry, I have leased everything until Rivian. The upside of leasing is great if you understand it. I have sold vehicles I have leased for good profits, reduced taxes and especially interest.

Several companies like Ford, Nissan and others are changing leases to force you back in to that company. Will be interesting to see, I would much rather buy out a lease to own the car than finance traditional from day 1
 

Donald Stanfield

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I like my cars like I like my women… newer model every 3 years 😉 so yeah I’d be all in on leasing a Rivian if able.
Yeah the changing women every 3 would be far more expensive than the car.

$60,000 60 month loan at 6%, after 36 months you've paid $7930 just in interest. On a 3y lease that's an extra $220 a month. Obviously we don't know what Rivian is going to use as their residual values yet, but I'm guessing that it's actually going to end up being a better deal to lease with loan interest rates being so high right now.
The choice in the quote between the two of us in that conversation was never between financing a purchase and leasing. The discussion him and I were having was between buying the truck outright in cash or leasing. The value of cash he was referring to is the amount you could potentially earn on the money if you just financed. That's only really applicable in a situation where interest rates are super low and the stock market is booming with relatively low inflation.

Right now with interest rates and inflation the way it is buying the truck in cash outright is a far better financial move than leasing even with the cash invested.
 

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Yeah the changing women every 3 would be far more expensive than the car.
Amen to that.

Right now with interest rates and inflation the way it is buying the truck in cash outright is a far better financial move than leasing even with the cash invested.
I would agree with this generally but depending on your specific situation, leasing could make more sense. For example, I do not qualify for the $7,500 incentive as a cash or finance purchase. However, if I lease I can get that $7,500 incentive as a cap cost reduction for most OEMs not named Ford, GM, or Tesla.

I can then turn around and buyout the lease - even with financing as long as I could get a good rate, and I have access to credit unions with rates as low as 3.6%.

Right now you can get CD's for 5+ percent and you will absolutely get better than that in the stock market if you are managing things correctly.

So in that scenario, leasing makes more sense. But it is a very specific case.
 

Donald Stanfield

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Amen to that.



I would agree with this generally but depending on your specific situation, leasing could make more sense. For example, I do not qualify for the $7,500 incentive as a cash or finance purchase. However, if I lease I can get that $7,500 incentive as a cap cost reduction for most OEMs not named Ford, GM, or Tesla.

I can then turn around and buyout the lease - even with financing as long as I could get a good rate, and I have access to credit unions with rates as low as 3.6%.

Right now you can get CD's for 5+ percent and you will absolutely get better than that in the stock market if you are managing things correctly.

So in that scenario, leasing makes more sense. But it is a very specific case.
Agreed that if the 7,500 is a factor then it would swing the benefit towards leasing for myself as well. I too do not qualify with the income cap restrictions and if I could buy out the lease in a month or two it would be without question the best way to go.
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