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- Feb 1, 2020
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- 1999 Mercedes 320E. 2003 Passat Wagon, just finished lease of 2017 Audi A3 Enron
Great explanation, thanks! The bottom line for me is that since I will only keep the car for three years, I don't really care what the residual is other than how it affects the overall cost. At the moment I cannot make that determination because Ford doesn't include RCL in the finance tools on Ford.com (why?). Right now if I compare Ford Options on Mach-e with a lease from Tesla Model Y (which I am not considering) or VW ID.4 (which I am), Ford Options is not a very good deal. I would love to be able to see if RCL is better or worse than Options.The answer seems simple but some people here seem to struggle mightily so let's go over it one last time:
A manufacturer has a vehicle which they believe has a FMV of $50K. A reasonable residual would be $25K. The government now gives a $5K credit/rebate. What does the manufacturer do? Obviously it increases MSRP to $55K since that effectively leaves FMV at $50K.
For leasing it has choices. It can increase the residual to $30K or 55%. It can use the $5K as cap reduction and leave the residual at $25K or 45%. It can do a combination of these. Or, as Ford has done with Ford Options, it can leave the MSRP at $55K and the residual at $25K and let the customer have the $5K as a rebate. And of course there are other factors it can use, such as incentives and interest rates.
So the answer to the question of "where that $7500 went" is: With Ford Options as a rebate to the customer. With RCL to the residual.