Lease vs. Buying Used

[JBW1273]

I know there is a strongly held belief that leasing EVs is the better way to go. My understanding is that belief is based primarily on the huge depreciation new EVs take. However, if I were to buy a 2-year old Taycan, a lot of that depreciation has already happened. I'm curious what other considerations push people to believe that leasing is better. Is it the rapidly changing technology (a different kind of depreciation)? It seems that buying a 2-year old CPO Taycan is the sweet spot. I would still have two years of the original warranty and then get another two years of CPO coverage after that, and am getting a $100K+ car for about half of what it sold for. I'm obviously not the first person to think of this, but I am curious what people think about leasing a new Taycan vs. buying a used one.

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[69Mach390]

Yes the total cost of ownership buying used is cheaper than leasing a new car.

But then you’re driving a car that’s 2 years older.

The only time it’s cheaper to buy/lease new is when a car has extremely low depreciation or there are incredibly large leasing incentives.

That said, a CPO isn’t the best deal either. Finding a great deal on a used Taycan may mean buying a straight up used one from a non-Porsche dealer.

I got my 24 from a Dodge dealership. It had significantly more options, less mileage and was $10k cheaper than a 23 CPO from a Porsche dealer.

You could always buy an extended warranty later if you think you need it. Or pocket the savings for possible out of pocket repairs in the future.

 

[Caraholic]

I vote neither. Lease a used cpo car that is where the value is. Bought first one new lost an absolute ridiculous amount of money and it was in the shop for half my ownership. Leased my second one. You at least know what your going to loose upfront. Also wouldn’t recommend one pay.

 

[Mr.Smith]

Problem with Taycan lease is the horrible money factor and poor residual, specially on higher end models.

There are really good lease incentives on new 2025s right now

 

[AutoX]

I think the biggest consideration right now is: Do you want a J1.1 or a J1.2. The new models are significantly better.

 

[DerekS]

Problem with Taycan lease is the horrible money factor and poor residual, specially on higher end models.

There are really good lease incentives on new 2025s right now

Agreed, I considered a lease but it would have been spending 100K with nothing at the end.

 

[Mr.Smith]

Agreed, I considered a lease but it would have been spending 100K with nothing at the end.

Exactly.
I was going to lease my car for incentives, then buy it out after that 2nd payment.

At a 45% residual, 8.4% APR (Money Factory), it made no sense at all.

 

[Jasper4S]

Leasing is usually more expensive. Sometimes you might get lucky and it turns out cheaper, but leasing companies are commercial businesses—they’re not there to benefit you. If they miscalculate and you happen to benefit, the next person with the same car and financial situation probably won’t.

The real question is: can you afford to miss the cash or not? This is a financial decision, don’t base it on random people on a forum.

Here in the Netherlands, financial leasing is uncommon. You either can afford it or you can’t.

 

[SoccerMan94043]

Exactly.
I was going to lease my car for incentives, then buy it out after that 2nd payment.

At a 45% residual, 8.4% APR (Money Factory), it made no sense at all.

That's a better money factor than I could negotiate, but I was pretty specific on what I wanted so it wasn't going to come through any kind of a deal.

Best I got them down to was .0038 which is 9.1 APR... ridiculous.

I did the math on my GTS and I come out ahead by 10-15K by buying outright, assuming the residual value is close to what they were quoting and 7% growth opportunity lost. I know I'll need to take a hit from that to sell it myself, but I figure 5K should make that work, so I'm risking ~10K on residual value.

It will likely be a wash in the end, but maybe not. And I don't have to worry about miles I drive, what I choose to do to the car, or whether I want to keep it at after my just less than 6 years of warranty are up; I'll keep it at least 5 years and maybe there will be an electric Boxter/Cayman by then.

 

[Mr.Smith]

That's a better money factor than I could negotiate, but I was pretty specific on what I wanted so it wasn't going to come through any kind of a deal.

Best I got them down to was .0038 which is 9.1 APR... ridiculous.

I did the math on my GTS and I come out ahead by 10-15K by buying outright, assuming the residual value is close to what they were quoting and 7% growth opportunity lost. I know I'll need to take a hit from that to sell it myself, but I figure 5K should make that work, so I'm risking ~10K on residual value.

It will likely be a wash in the end, but maybe not. And I don't have to worry about miles I drive, what I choose to do to the car, or whether I want to keep it at after my just less than 6 years of warranty are up; I'll keep it at least 5 years and maybe there will be an electric Boxter/Cayman by then.

If it's a car you love, then purchase is definitely the right approach.
Also of you're financing, rates go down,.you can always refi for a lower rate, pay down the loan more to decrease rate exposure.

The MF on new Taycans is around 7.9% now, CPO is higher from PFS.
Plus that silly $1095 acquisition and disposition fee when you lease

Porsche is too smart when they lease their cars. Audi, not so much

 

[prj]

You have pretty insane rates.
Meanwhile in EU, we have 6 month Euribor+1.45%, which is 3.62% APR at current rates.
For EV's below 60k there's even a 1.35% option (some kind of EU incentive by central bank for collateral on new EV's).

I am buying my Taycan new from Germany outright, bringing it to my country, and then doing a leaseback (selling it to the bank), because I can compound way more than 3.62% goddamn APR. Just free money. Reason I am not buying it from the local Porsche dealer is because the German dealer bought my Turbo S outright as trade in.

That said, It's like 25% down, 25% residual.
But when the APR on the car is almost the same as APR on real estate then you'd be dumb not to take the 100k.

8%+ APR seems completely wild/predatory to me. Maybe with 0 money down only.

 

[Mr.Smith]

You have pretty insane rates.
Meanwhile in EU, we have 6 month Euribor+1.45%, which is 3.62% APR at current rates.
For EV's below 60k there's even a 1.35% option (some kind of EU incentive by central bank for collateral on new EV's).

I am buying my Taycan new from Germany outright, bringing it to my country, and then doing a leaseback (selling it to the bank), because I can compound way more than 3.62% goddamn APR. Just free money. Reason I am not buying it from the local Porsche dealer is because the German dealer bought my Turbo S outright as trade in.

That said, It's like 25% down, 25% residual.
But when the APR on the car is almost the same as APR on real estate then you'd be dumb not to take the 100k.

8%+ APR seems completely wild/predatory to me. Maybe with 0 money down only.

It's different in the US. It doesn't matter how much you put down, just the residual set by Porsche Financial, APR which is called the "Rental Fee".

It's really Porsche that does this because they don't want to lease the cars.
Audi RS E-Tron GT Performance had a 1.2% rate.

Audi financial is what moves cars here. 1.2% APR, 61% residual for 36 months, 12k miles a year.
Turbo S is 44% residual, 8.4% APR same terms

 

[kern417]

I went down this rabbit hole and came to the conclusion that leasing doesn't make sense. I don't get the leasing argument regardless of the car's price. If all you want to do is lease cars, that's fine. But it's not a value proposition. You are effectively paying for a long term rental with nothing to show for it at the end.

Then there's the concern with warranty, but paying $100k+ is much more expensive than lightly used + extended warranty, or no warranty at all and limited to no maintenance/repairs.

Only benefit to buying/leasing new is getting the exact spec you want which is near impossible with how configurable these cars are.

I went with buying used. There are several great options out there for $60k or less if you look. If it ends up being a lemon, I need to pay double to "lose money" against a new car, that could still have issues and time lost despite the warranty. I plan on keeping this one long term like all my cars, so we'll see if I regret it.

 

[Mbm]

Im in Canada and 18 months ago I bought a 21 4s. I paid 103k cad (158k new) and financed through Porsche at 4.99% so my payments are about 1620$ per month. This will only be a good option if I keep the car for a long time as Porsche offered me 70k as a trade last month. As it has cpo warranty which can be extended until the car has been in service for 15 years (6200$ for 3 years, doesn't cover hv battery though) I hope to be ahead in the end, but buying only makes sense for long term ownership.

 

[69Mach390]

I went down this rabbit hole and came to the conclusion that leasing doesn't make sense. I don't get the leasing argument regardless of the car's price. If all you want to do is lease cars, that's fine. But it's not a value proposition. You are effectively paying for a long term rental with nothing to show for it at the end.

Then there's the concern with warranty, but paying $100k+ is much more expensive than lightly used + extended warranty, or no warranty at all and limited to no maintenance/repairs.

Only benefit to buying/leasing new is getting the exact spec you want which is near impossible with how configurable these cars are.

I went with buying used. There are several great options out there for $60k or less if you look. If it ends up being a lemon, I need to pay double to "lose money" against a new car, that could still have issues and time lost despite the warranty. I plan on keeping this one long term like all my cars, so we'll see if I regret it.

Sometimes, there are more/better incentives for a lease.

As far as “getting something in the end” goes, you have an agreed price at the end where you can buy out the lease.

In my last car (Mach E), the residual value would have been much higher on a lease than the actual value I sold the car for.

My cost of ownership on a lease would have been much lower than the purchase that I did.

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