It depends on the individual case. In Washington State we have a EV lease incentive of $9,000 which is stackable with the $7,500 federal and $1,000 referral credits. Essentially ends up being a 36 month lease for about $16k for a $52k 2024 Model Y.
The real advantage to leasing is the unknown future value of the car. The EV used market is in its infancy and the technology is changing rapidly. The lease is based upon a residual value that is extremely difficult to predict, as is Tesla’s pricing. Just ask the guy that spent $500 for the dark wheels 2 weeks ago that are now standard issue. I appreciate the research and mathematics you put together but the future value of used EVs is still uncertain.
It’s typically Tesla that pulls this Bs. Love the vehicles and love their technology, but they sure have some Bs marketing and sales tactics. Constantky changing the vehicle prices like seasons change, options that come and go in the middle of the night (literally), etc. Can’t think of a single other manufacturer that keeps changing things nonstop, unnecessarily, like Tesla does.
The avg difference between a lease and loan is $200/mo. If you were to lease and save $200/mo for 72 mos you would have $14.400 without any interest compounded in. You would be driving a new car in the last 3 years with new tires and no out of pocket expenses for repairs. How does this sound?
Supply and demand. In 3 yeares there will be so many teslas for sale. None of them will go for kbb price. Cases is very individual. I use to drive a 12 mpg pick up and now added model y under a leaase. My lease cost for 3 years worth like the gas i would spent. It was no brainer for me to buy it. First time leasing. No regrets
Leasing an ev right now can be a great idea. If EVs continue to tank, if the value of your car is 10k less than the lease shows, you just hand them the keys.
Prices aren’t going any lower than were they are currently. Maybe a few grand here and there. Mostly it’s just a return to normal after the supply chain shortages
And the buy numbers were much better last month with 0.99% loan rates, which is why I ordered a Model Y eight days ago. Had to get a blue car with white seats, but my five year lease payments will be just a few dollars more than the six year loan payments he uses, so basically saving a year of payments.
Leasing was never meant to be the better financial option, you can't pay less each month and come out ahead? The interesting question that arises now, is, who's going to want to buy your used model Y when everyone can just pay for robotaxis everywhere? I think this is the biggest risk of buying a car right now.
Meh… The model y juniper refresh will be out in a year or so. Buying now, you’ll be buying just in time to have the old version of the Model Y. Leasing or waiting might be best if you don’t want the old version or just wanna get your feet wet in the EV market.
Applies to USA. Other countries get no tax credit. I had a M3P for 4.5 years depreciation per year much more than my new lease is going to cost. I get a new car every 2 years under a lease. No hassle when it finishes. Peace of mind.
Yeah, at 5:30 you said "most likely" and there's the problem, IMO. No one, with certainty, can predict what a Model Y's residual value will be after 3 years. As soon as Tesla or another competitor announces a breakthrough in battery tech that allows for faster charging and more range, the value of your Model Y will plummet. Take the money you save in monthly payments for the next three years on a lease and save up the down payment for the next lease. You'll get all the benefits of an electric, zero out of pocket costs for warranty repairs, and you won't be upside down on your loan in year five.
Thank you, you are 100 pct right. The.. 99 and 1.99 financing did not find its way into the lease. Also the lack of a guaranteed end of lease buyout or any buyout is a non-starter. What if car prices are really high when lease is up? You are forced to start anew rather than keep your car? What if you have gone over your allowed miles or have some body damage that you might "leave alone" if it was your car? Tesla will charge you. If theres a buyout you just vuy it instead of pour more money into their coiffures.
It's actually 50% depreciation after 3 years, most will not able to affort 10k a year depreciation. If the vehicle is bought and sell within 3-4 years, the equiity is negative, be sure not to have any emergency situation where it needs to sell within 4years.
Whether or not it is a good deal is totally based on residual value after the lease is up and the tax advantage if available. At a cost of $400 per month or $15,000 over 3 years; But currently you get the $7500 federal tax break; (plus maybe lower cost yet in some states) so if your income is adequate; your overall cost is $6500 for 3 years; if the Model Y has a residual value of only $20,000 (inflated dollars) you potentially get the car at an effective cost under $26,500. While it is possible the residual value would rise (like if interest rates fall) it may cost you more; if EV resale values crash more so than even now - you may end up paying even less than the $26,500.
I lease. I have leased every vehicle I have had since the mid ‘1990’s (I’m THAT old). Payments are much lower than buying, the vehicle is under warranty and, I the rare case something does go wrong, it’s covered. I am in a new car every two or three years. Leasing makes even more sense with EVs. The technology is rapidly advancing and, so far, depreciation is very high. There are situations where leasing doesn’t make sense, such as if you drive more than 12 to 15k miles per year or you can pay cash up front to you keep your vehicle just about forever. I’m not that guy. I did drive a lot of miles once due to long commutes and lots of travel. Those days are gone.
Leasing is an "affordable" option not the "cheapest" option. Leasing will cost you way more than financing for a car kept the same amount of time. But it's more affordable for those that can't make bigger monthly payments.
In that case, you are correct. However, for the large number of people who qualify for the credit, the loan option looks like a better deal based on the math.
I just bought a model Y. Spent hours on forums and talking with tesla sales. The $7500 credit is mostly swallowed by tesla not you the purchaser. The 7500 is not deducted from the cap cost. One agent told me it's factored into a higher residual. Another outright told me there is no credit factored in to the lease! Other manufacturers are deducting it from your lease and some, like tesla, are eating up most of it. I went with loan instead and received the full 7500 off the cap cost of the vehicle. Hope this helps
ok but going over mile allowance costs you $0.25 per mile which is only 2500 per 10k miles. i don't know if there's other costs for going over the mileage, but if that's it, that's not bad at all
A nice video - however the key sentence is at 5:30 when you say “‘most likely’ you will save after selling than lease! “ would it really? What about the EV costs going down drastically??
Depending on your area and market will determine whether purchasing or leasing is better. No one is buying used EV's in my market. Leasing is the way to go.
Regarding depreciation I know the only way we can find it is by going to 2021 models but again we are not talking about Toyotas and Hondas that surely keep their value….would that same apply for Teslas after 3 years?
You are using depeciation amounts that are not correct. The actual depreciation is closer to 40% and not the projected 23% used in this calculation. Doubt this? Try to sell it after 3 years and find out. If you lease, simply give them the keys and walk away.
You are talking apples, when I am talking oranges. If you look at the car values I quote after 3 years, they are identical to the selling price of the 2021 Model Y according to KBB (with the exception of the Performance model that had such a big price change). My percentages are ADJUSTED for the Tax Credit, which being a point of sale credit is a direct discount off of the purchase cost. Thus, the depreciation percentage has to be calculated from that new lower cost basis. Also, my 6-year values of the Model Y in the $20K range are very fair and realistic.
@@Cleanerwatt Thats true enough you could resell a used car but talk about a beating - in fact it is this very beating I am concerned about that makes me think a lease would protect a person from massive declines in value; right now people can't get even close to what they paid a couple years ago for a Y because they price of a new car has been slashed and Chinese makers are losing massive money to be even cheaper; driving the Market into a deep dark hole. In America or Europe the tarriffs may protect buyers to some extent on plunging EV prices.
@@Cleanerwatt sell your car with bad equity always if you have a loan that the worst advice i have brand new car 2023 i lost value 12k until now i trade it with Tesla for 21k i got for 35k because i got loan for it and that was big mistake...
You can’t count on the model y not being discounted to oblivion in the next 3 years. You better off leasing if you know you want to get a new model. The savings in this video go away the moment the price is discounted
How much lower do you think the model y standard LR will go? It's in the 30s right now. This is it's fair price point imo. You want cheaper , wait for the model 2 to come. It's price point will be 18 to mid 20s.
Depreciation is the same whether you lease or finance. Lease interest rates, known as money factor, for the last few months have been around 8-10% where as tesla was offering .99% financing.
This doesn't take into consideration maintenance costs, changing tires, tesla dropping prices enormously on new vehicles at they've done, etc. Leasing is way more cost effective when you take the reality of car ownership in its totality into the mix. Plus, you have a completely new car at the end of your lease rather than an aged car
This is not a true cost of ownership video... and the maintenance, repair, energy costs etc. during a 3-year period would be identical for a lease versus a loan. You do bring up a good point with price changes , but that can go both ways... prices can go up like they have before! Leasing is not a good deal in my opinion.
@@Cleanerwatt but the problem is that car maintenance has a way of compounding. So let's say you have identical problems, say the control arm. Getting that fixed still leaves you with a higher propensity for that kind of related failure later in the cars life. For an owned car, you're going to have to own those issues, let alone if you get a car that has defects that have to be addressed even under warranty. All of these things do add up and make the risks of ownership easy more expensive than portrayed imo
Totally disagree on depreciation after 6 year you might be lucky to 20% of original price. 20% after 3 years haha 20% gone as it rolled out of show room
It depends on the individual case. In Washington State we have a EV lease incentive of $9,000 which is stackable with the $7,500 federal and $1,000 referral credits. Essentially ends up being a 36 month lease for about $16k for a $52k 2024 Model Y.
The real advantage to leasing is the unknown future value of the car. The EV used market is in its infancy and the technology is changing rapidly. The lease is based upon a residual value that is extremely difficult to predict, as is Tesla’s pricing. Just ask the guy that spent $500 for the dark wheels 2 weeks ago that are now standard issue. I appreciate the research and mathematics you put together but the future value of used EVs is still uncertain.
It’s typically Tesla that pulls this Bs. Love the vehicles and love their technology, but they sure have some Bs marketing and sales tactics. Constantky changing the vehicle prices like seasons change, options that come and go in the middle of the night (literally), etc. Can’t think of a single other manufacturer that keeps changing things nonstop, unnecessarily, like Tesla does.
The value of used EV's older than about 5 years is zero.
The avg difference between a lease and loan is $200/mo. If you were to lease and save $200/mo for 72 mos you would have $14.400 without any interest compounded in. You would be driving a new car in the last 3 years with new tires and no out of pocket expenses for repairs. How does this sound?
This is it. Perfectly explained
maintenance is not covered in the lease agreement. Which means you are responsible for any repair.
@ all maintenance is covered with a lease even oil changes now
After you’re done with your 6 year loan you’ll be ready for a new car and you’ll end up trading it in anyway for another car with another loan
Supply and demand. In 3 yeares there will be so many teslas for sale. None of them will go for kbb price.
Cases is very individual. I use to drive a 12 mpg pick up and now added model y under a leaase. My lease cost for 3 years worth like the gas i would spent. It was no brainer for me to buy it. First time leasing. No regrets
Leasing an ev right now can be a great idea. If EVs continue to tank, if the value of your car is 10k less than the lease shows, you just hand them the keys.
Prices aren’t going any lower than were they are currently. Maybe a few grand here and there. Mostly it’s just a return to normal after the supply chain shortages
Can you do an updated cuz now they are offering 0% financing
And the buy numbers were much better last month with 0.99% loan rates, which is why I ordered a Model Y eight days ago. Had to get a blue car with white seats, but my five year lease payments will be just a few dollars more than the six year loan payments he uses, so basically saving a year of payments.
Only difference is he will own the car when it’s done.
Leasing was never meant to be the better financial option, you can't pay less each month and come out ahead? The interesting question that arises now, is, who's going to want to buy your used model Y when everyone can just pay for robotaxis everywhere? I think this is the biggest risk of buying a car right now.
Meh… The model y juniper refresh will be out in a year or so. Buying now, you’ll be buying just in time to have the old version of the Model Y. Leasing or waiting might be best if you don’t want the old version or just wanna get your feet wet in the EV market.
Applies to USA. Other countries get no tax credit. I had a M3P for 4.5 years depreciation per year much more than my new lease is going to cost. I get a new car every 2 years under a lease. No hassle when it finishes. Peace of mind.
I would never recommend leasing a model Y. You will love it and put way too many miles on it. 😂
Yeah, at 5:30 you said "most likely" and there's the problem, IMO. No one, with certainty, can predict what a Model Y's residual value will be after 3 years. As soon as Tesla or another competitor announces a breakthrough in battery tech that allows for faster charging and more range, the value of your Model Y will plummet. Take the money you save in monthly payments for the next three years on a lease and save up the down payment for the next lease. You'll get all the benefits of an electric, zero out of pocket costs for warranty repairs, and you won't be upside down on your loan in year five.
Thank you, you are 100 pct right. The.. 99 and 1.99 financing did not find its way into the lease. Also the lack of a guaranteed end of lease buyout or any buyout is a non-starter. What if car prices are really high when lease is up? You are forced to start anew rather than keep your car? What if you have gone over your allowed miles or have some body damage that you might "leave alone" if it was your car? Tesla will charge you. If theres a buyout you just vuy it instead of pour more money into their coiffures.
Leasing is absolutely way to go here in the UK, depreciation of Tesla is just crazy.
It's actually 50% depreciation after 3 years, most will not able to affort 10k a year depreciation. If the vehicle is bought and sell within 3-4 years, the equiity is negative, be sure not to have any emergency situation where it needs to sell within 4years.
Whether or not it is a good deal is totally based on residual value after the lease is up and the tax advantage if available. At a cost of $400 per month or $15,000 over 3 years; But currently you get the $7500 federal tax break; (plus maybe lower cost yet in some states) so if your income is adequate; your overall cost is $6500 for 3 years; if the Model Y has a residual value of only $20,000 (inflated dollars) you potentially get the car at an effective cost under $26,500. While it is possible the residual value would rise (like if interest rates fall) it may cost you more; if EV resale values crash more so than even now - you may end up paying even less than the $26,500.
I lease. I have leased every vehicle I have had since the mid ‘1990’s (I’m THAT old). Payments are much lower than buying, the vehicle is under warranty and, I the rare case something does go wrong, it’s covered. I am in a new car every two or three years. Leasing makes even more sense with EVs. The technology is rapidly advancing and, so far, depreciation is very high. There are situations where leasing doesn’t make sense, such as if you drive more than 12 to 15k miles per year or you can pay cash up front to you keep your vehicle just about forever. I’m not that guy. I did drive a lot of miles once due to long commutes and lots of travel. Those days are gone.
Lease is the best option for sure
Leasing is an "affordable" option not the "cheapest" option. Leasing will cost you way more than financing for a car kept the same amount of time. But it's more affordable for those that can't make bigger monthly payments.
yes but you are locked into technology that keeps rapidly changing and these tesla's are quickly lolsing value due to price cuts on newer models.
If you make to much and don’t qualify for the 7500 dollar credit, you still qualify under the lease. It’s not a better deal.
In that case, you are correct. However, for the large number of people who qualify for the credit, the loan option looks like a better deal based on the math.
I just bought a model Y. Spent hours on forums and talking with tesla sales. The $7500 credit is mostly swallowed by tesla not you the purchaser. The 7500 is not deducted from the cap cost. One agent told me it's factored into a higher residual. Another outright told me there is no credit factored in to the lease! Other manufacturers are deducting it from your lease and some, like tesla, are eating up most of it. I went with loan instead and received the full 7500 off the cap cost of the vehicle. Hope this helps
Excellent coverage of all the items that must be included in the calculation.
.99 last month also gave you 4% arbitrage with high yield savings accounts.
ok but going over mile allowance costs you $0.25 per mile which is only 2500 per 10k miles. i don't know if there's other costs for going over the mileage, but if that's it, that's not bad at all
Thanks for the video. Is there still a cost savings to buying if you do not qualify for the tax credit?
A nice video - however the key sentence is at 5:30 when you say “‘most likely’ you will save after selling than lease! “ would it really? What about the EV costs going down drastically??
Depending on your area and market will determine whether purchasing or leasing is better. No one is buying used EV's in my market. Leasing is the way to go.
Curious where your market is located
Regarding depreciation I know the only way we can find it is by going to 2021 models but again we are not talking about Toyotas and Hondas that surely keep their value….would that same apply for Teslas after 3 years?
You are using depeciation amounts that are not correct. The actual depreciation is closer to 40% and not the projected 23% used in this calculation. Doubt this? Try to sell it after 3 years and find out. If you lease, simply give them the keys and walk away.
You are talking apples, when I am talking oranges. If you look at the car values I quote after 3 years, they are identical to the selling price of the 2021 Model Y according to KBB (with the exception of the Performance model that had such a big price change). My percentages are ADJUSTED for the Tax Credit, which being a point of sale credit is a direct discount off of the purchase cost. Thus, the depreciation percentage has to be calculated from that new lower cost basis.
Also, my 6-year values of the Model Y in the $20K range are very fair and realistic.
The excellent element of a lease is - you can decide not to keep it. If you get the tax breaks that can be a pretty cheap option for 3 years.
If you have a loan, you can decide not to keep it as well... just sell the car. You can't just end a lease early without fees.
@@Cleanerwatt Thats true enough you could resell a used car but talk about a beating - in fact it is this very beating I am concerned about that makes me think a lease would protect a person from massive declines in value; right now people can't get even close to what they paid a couple years ago for a Y because they price of a new car has been slashed and Chinese makers are losing massive money to be even cheaper; driving the Market into a deep dark hole. In America or Europe the tarriffs may protect buyers to some extent on plunging EV prices.
@@litestuffllc7249with tesla leases, you can't keep it. No buy out. Have to return when lease is over , atleast here in the US.
@@Cleanerwatt sell your car with bad equity always if you have a loan that the worst advice i have brand new car 2023 i lost value 12k until now i trade it with Tesla for 21k i got for 35k because i got loan for it and that was big mistake...
You can’t count on the model y not being discounted to oblivion in the next 3 years. You better off leasing if you know you want to get a new model. The savings in this video go away the moment the price is discounted
How much lower do you think the model y standard LR will go? It's in the 30s right now. This is it's fair price point imo. You want cheaper , wait for the model 2 to come. It's price point will be 18 to mid 20s.
Interest and depreciation are much greater than leasing.
Depreciation is the same whether you lease or finance. Lease interest rates, known as money factor, for the last few months have been around 8-10% where as tesla was offering .99% financing.
The insurance costs on new cars will eat any fuel savings you might think you would have with a Tesla…. And any other new EV 🤷♂️
California , Geico. 2024 model Y P. $200 a month I got. Do you have a bad record maybe?
They also dont mention if you have bad credit
This doesn't take into consideration maintenance costs, changing tires, tesla dropping prices enormously on new vehicles at they've done, etc.
Leasing is way more cost effective when you take the reality of car ownership in its totality into the mix.
Plus, you have a completely new car at the end of your lease rather than an aged car
This is not a true cost of ownership video... and the maintenance, repair, energy costs etc. during a 3-year period would be identical for a lease versus a loan. You do bring up a good point with price changes , but that can go both ways... prices can go up like they have before!
Leasing is not a good deal in my opinion.
@@Cleanerwatt but the problem is that car maintenance has a way of compounding. So let's say you have identical problems, say the control arm.
Getting that fixed still leaves you with a higher propensity for that kind of related failure later in the cars life. For an owned car, you're going to have to own those issues, let alone if you get a car that has defects that have to be addressed even under warranty.
All of these things do add up and make the risks of ownership easy more expensive than portrayed imo
Well done Sir.
Thanks
Why not look at the prices of 3 year old Model Y? its way lower than your calculation wtf
If tesla wants you to....... DON'T !!!.
In the words of the famous..........."let that be a lesson to you"........... right Elon ?.
Teslas won’t hold their value so…….
Wow - this video is painful to watch. Unnecessarily indirect and overly complex...
You're giving me a headache😅😅
Sorry, Not everyone has money to buy a Tesla and pay $900 a month. Totally off base
Many people do have the money.
I just turned in a VW electric car on lease after 3 yrs happy to see it gone & not trying to sell this obsolete pile of junk
@@mrkymrk99the average person indeed does not
Totally disagree on depreciation after 6 year you might be lucky to 20% of original price. 20% after 3 years haha 20% gone as it rolled out of show room