Finance or Lease?

[Bkenyon53]

Just wondering what you will do when it comes time to sign on the dotted line.

Normally I finance but with EVs and the constant improvements to technology in battery range, I am leaning towards leasing and seeing how that plays out. Just thinking 3-4 years after purchase it'll have 40-60K miles on it (with my driving). We know that batteries degrade over time...so will the resale value of these take a huge hit because the life of the battery is now that much closer to replacement? ICE's can last a long time with proper maintenance but there's not much you can do with an HV battery aside from a full replacement.

Not to mention, if a 2032 has an improved battery that gets another 100 miles of range (just a hypothetical), who will want a 2028 with a degraded battery unless it's price has been slashed?

Obviously there is time to think about this and see how the market plays out but those are just my current concerns.

 

[joewilk45]

I think scout will align themselves with a financial partner most likely the current financial partner in structuring lease deals to allow all tax incentives as well as included maintenance through out lease. Most likely if there still is a lease loophole you will be able to lease car get 7500 tax credit then buy it out be nice if scout had this deal as an option with their financial partner so you could do this at delivery and get both incentives and low new car financing.

 

[Hedrock]

I’m struggling with this as well. New EV = lease, but lease to buy is always a gamble. I’m hoping to feel confident enough in the platform by the time I can get mine (I assume late 2027 at the very earliest) to buy, but even that will probably be a no go at current rates. No way to tell what the fed will do by then.

I wonder if they’ll even offer leases at first, given how long it took Rivian to roll out leasing (and still not in all states, I think).
Maybe we’ll be lucky and EV depreciation will improve by then

 

[joewilk45]

Well if I'm the finance arm of scout I have this template already in place. They need to move units and no better way is to offer leasing and competitive finance rates. No financed company invest 2 billion with out a business plan showing how they plan to market their product. They the finance company probably already includes this in their finance contract they most likely have a template in place. They are not investing in a start up without a well thought out business plan and desirable product. So I see both leasing and financing available at ordering along with trade in options

 

[Forrest]

It’s a wait and see decision for me for all the reasons mentioned already + final delivered price. I’m leaning toward finance because I want to feel free to mod as I see fit (while keeping warranty in mind). But if lease ends up being more attractive and residual seems okay, that’s an option too.

 

[Dive Bar Casanova]

We think being down some distance on the Scout deposit list perhaps any early mulligans will be cured by the time we take delivery. So we'll purchase.

The Rivian synergy is a good reason to believe software hiccups will be resolved pretty quick.

If our current transportation pukes before then we'll short lease something like the Blazer SS EV.
On paper the Scout is 2 and a half times more the vehicle than the Blazer is for only a few bucks more.

 

[joewilk45]

The problem scout has is it needs to keep its reservationist interested for close to two years. That's why I think they need to get the design finalized and the order books open so now we have renewed enthusiasm tracking our orders and the excitement of delivery. So I hope that happens in the hear future.

 

[ScoutMagnatta]

Just wondering what you will do when it comes time to sign on the dotted line.

Normally I finance but with EVs and the constant improvements to technology in battery range, I am leaning towards leasing and seeing how that plays out. Just thinking 3-4 years after purchase it'll have 40-60K miles on it (with my driving). We know that batteries degrade over time...so will the resale value of these take a huge hit because the life of the battery is now that much closer to replacement? ICE's can last a long time with proper maintenance but there's not much you can do with an HV battery aside from a full replacement.

Battery degradation isn't that big in 4 years unless the charge cycle is constant

https://insideevs.com/news/723734/tesla-model-3y-battery-capacity-degradation-200000miles/

So instead of your 500 miles of range you now have 425~ give or take.

 

[Dive Bar Casanova]

I'm kicking in a few bucks a month in an savings account so when the batteries do PUKE, if out of warranty roll into the service center and get them replaced, pay the tab,,, good to go and not look back.
I absolutely will not get stressed over it.

1000 insane ft lbs of Torque and all the cool features and devices the Scout has,,,, the juice is worth the squeeze.
Insane is an understatement, and it's exciting and worth the expense and wait.

 

[vrgruver]

"Generally" a lease is the depreciation expected on a vehicle. (disregard profits and such for the exercise) If a 3 year lease is $20k, they expect the residual or buyout value to be around $40k on a $60k vehicle. If it is worth less, you can hand the keys and walk away. If it is worth more, you may be able to buy the vehicle on the predetermined buyout and flip it for a profit, or buy it and just already have it worth more than your buyout. I have seen it both ways. There is also the nice bonus that you only pay sales tax each month on the monthly payment and not the whole value up front. It really depends on your investing plan and aligning with that will net a lower overall purchase.
I have flipped three for a profit on a lease expiration, and also bought used during a slow market and sold for a profit a couple years later during a busy market. The crystal ball doesn't exist so I will just try to matchup to my investing plan.
I do believe it should not be leased if you can't afford to buy. That just seems like living outside of my budget.

 

[Dive Bar Casanova]

"Generally" a lease is the depreciation expected on a vehicle. (disregard profits and such for the exercise) If a 3 year lease is $20k, they expect the residual or buyout value to be around $40k on a $60k vehicle. If it is worth less, you can hand the keys and walk away. If it is worth more, you may be able to buy the vehicle on the predetermined buyout and flip it for a profit, or buy it and just already have it worth more than your buyout. I have seen it both ways. There is also the nice bonus that you only pay sales tax each month on the monthly payment and not the whole value up front. It really depends on your investing plan and aligning with that will net a lower overall purchase.
I have flipped three for a profit on a lease expiration, and also bought used during a slow market and sold for a profit a couple years later during a busy market. The crystal ball doesn't exist so I will just try to matchup to my investing plan.
I do believe it should not be leased if you can't afford to buy. That just seems like living outside of my budget.

I agree, exception being EV's.
EV's resale numbers don't crunch the same.
I look at a cheap-O lease as depreciation insurance.

You have a known bottom line loss and not take a financial beating.

Check out people on YouTube selling their 2 year old EV's.
They are getting murdered with the resale value.
Creamed, dazed and confounded.

Still get 24K miles to use it.

 

[Mr._Bill]

Leased vehicles are usually a good deal for the next owner. I bought a lease return, a 2013 Nissan Leaf in March of 2015 for a decent amount (I think about 15k). I've put about 20k miles on it over the last ten years (it's at 35k miles now). I've put one set of tires on it, replaced the 12v battery twice, and it is still on the original brakes. The main battery was replaced under warranty in October 2017, and is still above 85% capacity. I have a Jeep pickup I drive, mostly for work, and drive the Leaf when I don't need the truck. The online sources currently value my Leaf at $1500.

 

[joewilk45]

EV's and Plug in hybrids qualify for 7500 tax credit through a lease loophole so you lease it get 7500 credit then buy out lease this allows you to take advantage of incentives so I would think scout would offer access to all incentives

 

[CeeJay]

I will finance. If you put a lot of miles on your car Leasing is not a good way to gas as you will get charged per mile over the allotted amount which is usually 10k per year. Every car company does it different, but it's typically around 10-12k per year.

I leased once and never again. When it came time to turn the car in, we were gouged with additional cost and when asked about turning the lease into a finance, they wouldn't honor what's already been paid toward the vehicle. This was also several years ago. Things may have changed since then.

 

[Bkenyon53]

I will finance. If you put a lot of miles on your car Leasing is not a good way to gas as you will get charged per mile over the allotted amount which is usually 10k per year. Every car company does it different, but it's typically around 10-12k per year.

I leased once and never again. When it came time to turn the car in, we were gouged with additional cost and when asked about turning the lease into a finance, they wouldn't honor what's already been paid toward the vehicle. This was also several years ago. Things may have changed since then.

I'm currently in a Jeep 4xe lease. Only due to the unknowns with the technology on my end.
I had a 15K per year lease and my buyout is $40K. Same vehicle on lots is $32K. They have plummeted and I'm so glad to be able to let Stellantis/Jeep eat that huge depreciation rather than me take it on.
Wranglers usually hold their value really well...but notsomuch with the 4xe.
Normally I finance all of my vehicles but something about this told me to lease it.