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Lease if you are unsure how to live with a EV and paranoid of EV. If you can adjust to EV life style, buy once, cry once.
In 3 years there will be so many Tesla M3/Ys on the road the resale price will most likely be more in line with ICE cars. After 3 years ICE cars are on average 40% off MSRP. Right now used Teslas are way too high. I see some 3s & Ys with major miles priced more than a new car minus the $7500 tax credit. Eventually that will sunset.
Leasing ANY vehicle is a HUGH mistake in and of itself unless you have the ability to write off the lease amount on your taxes. If you can't do this, don't lease!
thanks for the explanation, I have some other thoughts about it
1. some people will not qualify for the 7.5K credit
2. You have to pay full tax on purchase and CA has no tax credit on trade-in. But on lease, you only have to pay tax on depreciation value
Anyway, very high quality video, thumbs up
Thanks for the video , however pandemic pricing has definately blown Tesla car values to pop levels. As mentioned by another, in 3 years Tesla residual prices will be lower than today.
I think using KBB values is a mistake. The values listed here seem very high. Tesla has 2020 model 3s in their used inventory right now for $5,000 less than the figure you listed. They can be found for even less via private sale.
sorry but I think your math/tables are getting a bit fuzzy when displaying a table for purchased vehicle. In order to follow the math and numbers you getting I am having to recalculate them independently to follow where your getting your numbers. I think it would of made more sense to have in one table Original Value -> depreciation amount – > Current value -> Loan Balance ->Equity in the second you could show 3 Year Loan Cost -> equity -> True total 3 year cost
I didn't know Tesla leased out vehicles.
Lease gets $50/month off FSD. Is that enough to tip the balance?
🙋♂️THANKS JON , FOR HELPING OUT WITH SUCH IMPORTANT DECISIONS 🧐💚💚💚
If leased for 3 years your charging habits can be whatever you wish. (Irresponsible) Charge a long range dual motor to 100% everyday with disregard to battery degradation potential. You'll have access to full battery and not be restricted with only charging to 80% (which is a common practice to protect against battery degradation) This generally will only really manifest itself until after perhaps 4-5 years. Then it's not your problem as you will likely start a new lease and start all over.
Skipped the sponsor.
I think Tesla’s aren’t traditional cars. They are technology. I think battery and drivetrain tech is changing so quickly. Especially the automated driving computer and sensor suite. It could negatively impact this old tech in the not too distant future. So Lease could be lower risk option. You know what your upfront and monthly cost is. Then you hand back the car at end of lease.
Thanks Jon. 🙂👍 Of course, there's nothing to stop people from paying cash for a new Tesla, and saving all of those loan/lease costs. Equally, there's no shame in buying a used vehicle for ~80% of the price of a new one and thus removing that initial depreciation from the equation. It will still be within battery and drivetrain warranty for another 4 or 5 years, and very saleable after 3 years of ownership.
If you run a business then lease a car but if you don't finance it
Where do I start. Your period you used to set values was a period of pandemic, shortages, no competition and huge inflation. If expect those conditions to continue you are nuts. For the standard it was already to late to order and get a model 3. I was told 2-3 weeks just to get one with no real waiting list. Leasing is only a little more expensive if you use realistic numbers. You also did not mention if for some reason values are higher than expected you can buy the car at the end of the lease and resell it. The lease has lower payment and lower risk as you can benefit from higher prices while ignoring lower prices.
Good content! Thank you.
You can’t keep the Tesla after a lease
being retired, our tax liability is much less than the $7500 tax credit. So, we retired people seeking an EV will hope dealers will apply this credit. Also, as a NY resident, how will the $2000 credit work on a lease deal?
Jon, does President Biden's proposal for 500,000 chargers by 2030 seem excessive to you? It does to me. If the USA vehicle population is 90 million, and they were all BEV, then there will be enough chargers to fully charge each 70 kwh battery for (about) 1hour 20 minuets, every 10 days. This assumes that the average vehicle is driven 13,000 miles per year, has (about) a 70 kwh battery, gets (about) 350 miles per charge. To 80% charge, the charge times would be (about) 1 HOUR, performed every 8 days.
If the charge times were one HALF hour, the planned number of chargers (500,000) would be excessive by two-fold: a huge waste of time, money, and resources. Remember that this 500,000 number of chargers is for HALF of the USA fleet planning being electric by 2030. Thus, it would be four times excessive. Video?
I think Leasing is a better idea, in my case after upgrading exterior color (midnight silver metallic) and interior (white) after final payment I will end up paying $403.00 if I deduct monthly gas I used to spend ($160.00) on average i will be paying $243.00 elecricity has not gone up much, after 3 years I don't want to drive this car anymore I will give it back and probably will buy me one, that is the way I think but respect your assessment about Buying or Leasing!
I'd wait until we hear more about Project Highland and the new model 3, plus there are many new "game changing" battery and EV developments coming to fruition and new EV companies like BYD, NIO, Polestar growing their market share. Buy a Testa by all means, but I wouldn't use past valuations to predict it's depreciation after three years anything could happen in the next three years, we are in a time of technological transformation, leasing removes the uncertainties and risk, but at a hefty cost. Alternatively keeping your Vaxhall Ampera (Chevy Volt) which you own outright and costs almost nothing to run makes more financial sense, cars do keep you poor and debt is basically self inflicted slavery.
Why would anybody lease a car if you can only do 10000 miles? You might as well just rent a bomb for a few dollars 🤔 zero point to it..
So IMO the better long term play will always be buying the car whether it be cash or financing as long as you are not throwing gobs of money at the car in terms of maintenance or payments BUT I think leasing works for SOME people. We decided to lease a Model 3 RWD for 36M/15K w/ $2500 at $506.44 with taxes, plates, tags, and other fees and in contrast financing for 72 months, 5.44%, and $4500 down would be $720 a month with all fees before the tax credit and if you consider the $7500 credit you in theory can the car really is $615 a month. No the lease will not get the $7500 tax credit but if you look at the leasing terms you will see that Tesla is parlaying the tax credits probably into the leases to offset the rising rates. With destination and order fee ($250) the M3 RWD comes to $44,630. Tesla then deducts the order fee, and also gives a $500 rebate thus putting the actual purchase price to $43,880 and provides an insanely low MF of .0007930 which equals 1.9%. In the end again the better long term play is owning the car but we already have a paid off car and just wanted to lease to try out Tesla since it will be our first ever EV. What if we hate it (Tesla), what if we don't like the Model 3, what if our car is a lemon and has a bunch of issues, and what can we be doing with the money we aren't financing in the meantime? So yeah a Model 3 is even more so a rental when leasing since it no longer can be bought out but I still think there is a lot of merit to leasing if you don't drive ton, are uncertain about your long term car future, and like to try the latest and greatest and BTW Tesla Model 3 are still one of if not the best lease deals still out there if you do fall under the leasing category since something like the Lexus UX250H has a MF of .00264 which is 6.33% and three times the rate of Tesla charges, thus the Lexus UX250H Premium which is a Hybrid but very close is MSRP leases out with $3000 down for 36/12 equals $795 a month. A loaded Acura Integra Tech A-SPEC an ICE car which has a MF .00135 3.24% w/ $3000 down for 36/12 $ 500 while in contrast if we wanted an apples to apples comparison the Model 3 RWD w/ $2500 down and at 36/12 would be $464. So IMO the Tesla M3 is still the best lease deal out there as long as you don't plan on buying the car after or during the lease long term.
More than 50% of the population pays zero in taxes and thus are not eligible for the tax credit since it's only a credit for taxes you owe.
Tesla rep told me that 7500 tax credit applied even if the vehicle is leased.
If your a first time Tesla owner, in 2023 i would absolutely lease a Tesla model 3. The price cut is definitely amazing starting at only $349 a month. 15,000 miles a year is the same as roughly 40 miles a day. So if you dont make long run drives every single day, leasing might just be for you. I leased my first tesla in 2019, i got the M3 standard range, and everything went smooth, after 3 years. I turned it in and got the Model 3 Performance financed. AGain, do more reasearch and leasing might be for you
You in no way can assume that the depreciation that occurred between 2020 and 2023 will represent the depreciation that will occur between 2023 and 2026. That period was an anomaly and unlikely to happen again. At one point used cars were selling higher than new cars. The only real decision that you need to make here is how fast you think these will depreciate vs. how fast Tesla thinks they will, based on the residual amount on the lease. My bet is that all cars will start to depreciate way faster in the next 3 years, but who knows.
I ended up just buying a Model Y yesterday with financing at my credit union 4% 15k down and doing 48 month financing. I was almost sold on the lease BUT you lose the tax benefit of $7500 plus the $2,000 CA. You cannot customize your car as you wish, upgrading to yoke steering wheel, subwoofer, etc. Lastly, should you go over your miles you are subject to mileage overages up to a $.50 or $1.00 depending on wear and tear scale .Tires have to be in good shape too. Also should you go over you cannot decide to keep the car to avoid penalties. To each their own we'll see down the road if I made the right choice lol
Not a true tax credit…only a credit against taxes owed AND no carryover!!@
When I go to spec out that exact model 3 lease option, it shows $425 per month not $349. Did the price go up $75 per month in two months or am I doing something wrong? Thanks!
This man said low monthly price of 600 and 800 a month.