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Lease MS until M3

Lease MS until M3

What do you guys think?
50-60k Salary

Lease a MS 60D w/ AP for 3 years. Then Lease/Finance M3 after.

ccsccs7 | 15 juli 2016

Do you need a new car now? What about saving that money for your new Model 3, or is that not a concern?

mako7c4 | 16 juli 2016

Personally I would buy an older car from Craigslist and put more money down on the M3.... at least that's my plan.

codyb12889 | 25 juli 2016

That monthly payment will go a long ways towards paying off your M3 once it arrives.

If you just really want a car payment you can just open a separate bank account and start making M3 payments there. If you made the payment of an MS lease to that account every month then by the time you get your M3 you will have a very high % of the price as a down payment

I also considered doing what you were talking about and probably would have gone ahead and grabbed the new discounted version of the MS but decided against it with the ending of the buy back program. I just did not want to be upside down on a 70k car looking to switch to a 40k car and have a very messed up payment. While I am fairly certain Teslas will maintain their value very well it just felt like too big a of a gamble for me personally.

PhillyGal | 25 juli 2016

Don't do it - and this is coming from the adoring owner of a Model S.

Depreciation is highest at the beginning of a car's life and all you're paying for with a lease is that.

Do you have a car right now? Even if you hate it (like I do the car I drive most days of the week) just deal with it until the M3 comes out and treat yourself to a Performance upgrade. That's my plan. I got so tired of my gas car - and so in love with our Model S - that I seriously considered leasing an i3 until my 3 was ready. But it made no sense. My car should be worth something when I trade it in for M3 but the i3 lease would have eaten that up.

jordanrichard | 26 juli 2016

Be forewarned, you might get spoiled by the MS and not want to make the switch to a M≡. These 2 cars are/will be 2 different animals. The runs to Lowes and Home Depot that I make in my MS wouldn't be possible in a M≡.

omar10r1 | 6 augustus 2016

Variation on a theme: Just put down for my M3 reservation in South Carolina (so I'm way back in the line). I have a 2004 Hyundai that might not make it to 2019 (when I realistically think my M3 will be delivered) and it would be worth hardly anything for trade-in at that point anyway.

I can get about $1k for the Hyundai at trade-in now and also have a referral # from an S owning buddy, so I was considering leasing a barebones S 60 to hold me over, or perhaps getting a pre-owned 2013 S 60 (autopilot isn't THAT important to me...yet) despite knowing I wouldn't get the tax credit for a CPO.

Anyone have experience with similar situations or thoughts on if it's worth it? I almost considered 3-year leasing a Prius or Leaf as well...but it feels like I'm cheating.

Tom M.us_az | 6 augustus 2016

Sorry. I have 2 Tesla. But you should never buy a depreciating asset valued/priced more than your annual salary. Save as much as you can now and buy later.

Tom M.us_az | 6 augustus 2016

Sorry. But you should never buy a depreciating asset valued/priced more than your annual salary. Save as much as you can now and buy later.

carlk | 7 augustus 2016

@omar10r1

S60 seems to be a very good deal especially when you put tax credit into consideration. That will likely not be there when you are ready to buy the M3 unless the law is changed. Not to mention three years is really a long time. Like many say you might never want to get the M3 after you got the S.

High Plains Drifter | 8 augustus 2016

50-60K Salary? Absolutely not. You will be way over financed and will probably wind up losing the car to creditors.

dd.micsol | 8 augustus 2016

leasing an S is overkill for driving now for saving up for a mdl 3 down the road. Get a used honda civic for about 5,000.00. When you get your 3 Sell the civic-it'll sell fast too and only cost you about 1000.00 to drive it 2 yrs-unless your insurance is crazy bad or you drive a crazy amount. If it were me-I'd donate the car as a tax write off later on tax forms-different from the incentives, but every bit helps in that income range.

Ipakipryde | 8 augustus 2016

Tesla should post some numbers about lease payments, buying options for the people who put money down for the M3? What do you all think? I know that it will help me make a decision

codyb12889 | 20 augustus 2016

The new 2 year lease option on the S60 seems to be very purposely targeted at M3 reservation holders. If they were to add some rebate for a M3 at the end of the MS lease I am not sure I would be able to pass it up.

A "free" autopilot upgrade if you paid for auto pilot the whole 2 year MS lease would likely be perfect. Tesla collects the money for auto pilot on the lease and then deactivates it and charges the next person for the upgrade.

mntlvr23 | 20 augustus 2016

@lpakipryde - there is information on their new 2 year lease offer on their website (though there is no special break if you reserved a M3).

@OP/enrique - I view most of the advice above against it as great advice - but I will repeat it and put some numbers to it possibly drive the concept home. (advanced disclosure - I will never lease a car, as I view it as a bad financial decision - for me.)

I bought my first vehicle in 1987 (Acura Integra) for around $10K and drove it for 11 years and sold it for $3K - there were obviously some maintenance and repair work, but let's just make it a nice round number and say that the car's cost to me was approximately $1K per year (excluding gas).

I bought my second new car in 2001 (Volvo S60) for around $25K and am still driving it now, around 15 years. I will sell it next year after getting my M3 for around $3K and for argument's sake, I will say that the Volvo's cost to me was around $2K per year (jumped up 100% from the previous vehicle due to inflation and a nicer car).

I will buy my M3 for around $35K (after options and incentives) and will surely drive it for at least a dozen years. So we will round this car's cost to me to be around $3K/year - it make sense and is a good logical progression from the first two vehicles. (yes the numbers can be debated, but just wait for my point)

If I leased the MS for two years, it would cost me just shy of $600/month in addition to around $7.3K due at signing. - and I will total this up to be around $22K for the two year experience. This ends up to be $11K per year. These costs are based on using it for only 10,000 miles per year - and would increase if the mileage increase. These costs apparently already factor in that you will be getting a $7,500 tax incentive (From the Tesla website - "The payment calculations are provided for informational purposes only and may reflect assumptions that may not apply to you or lease terms for which you may not qualify. Model S qualifies for a federal tax credit up to $7,500 which is already included in the payment calculations".) This payment is also for the base model and will be increased if you get any options. Additionally, you must pay all taxes and fees.

From my very cursory computations, this lease would cost me over $12K/year - which is tremendous compared to what an average M3 buyer would be paying if they were to hold on to their car. Yes, the Model S is a larger and more expensive vehicle - but not likely in the ballpark for the average Model 3 buyer.

Everyone should understand the numbers prior to leasing. You are not buying a car, you are paying a high price for the right to borrow a car. Leasing my be favorable for some people under some circumstances, but it certainly is not for me.

Peace