Mach-E Financing and RCL Leasing Program Announced

[ajmartineau]

I'm glad a bunch of you will figure this out before I go to pick mine up.
I'm just going to ignore all financing threads until someone actually has a contract.

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[DBC]

Having said that, the monthly payment, using the Fed Tax credit of $7,500 as a down payment, is $749 a month vs. $633 for the Model Y with no money down on the model Y.

...

Hope this clarifies.

It isn't going to clarify because your numbers are wrong. The MME monthly would be $675.10, assuming that the Tesla Model Y lease doesn't include the $1500 CA Clean Air rebate, which it seems to. In this case the MME monthly would be $630.78, less than the Model Y lease.

Plus with Options you have a lower buy out price which is a big bonus. No comparison as to which would be better for most people.

Behold the right number:

 

[DBC]

I'm glad a bunch of you will figure this out before I go to pick mine up.
I'm just going to ignore all financing threads until someone actually has a contract.

It's a simple decision. If you think you might want to keep the MME then Options is far and away the best deal. Forget about leasing. If you are sure you don't want to keep the MME then you will have to run the numbers. Options still might be better.

Out of curiosity, if you go to the Finance calculator when configuring the MME do you get a discount as in the summary I've posted? If so what is it?

 

[Woeo]

Add 400 for paint and 240 for interior package (mats)

Use my zip code to get the incentive.

I am not conflating lease and options.

My Ford dealer tells me the residual on 15k miles RCL for ER AWD Premium MME is 55%, 57% for 12 k miles and 59% for 10.5k miles. Of course Ford keeps the tax credit.

Hope you lease your Tesla and stop
trolling here

that may be true.

However we are talking about residuals on leasing: not the balloon on the Ford Option plan.

Do not conflate the two.

FYI:

From the details of the Ford Option plan, including destination charges the MSRP of the Premium AWD LR is $55,800 I do not see the $1,000 incentive you are talking about.

The balloon is $24,552.

If we take $7,500 from the MSRP we get a cost of $48,300. A balloon of $24,552 is 50.8% close enough to your 52%.


Having said that, the monthly payment, using the Fed Tax credit of $7,500 as a down payment, is $749 a month vs. $633 for the Model Y with no money down on the model Y.

My local sales tax rate is 8.625%. The taxes on the Option plan will be $4,812, or an additional $133 a month bringing the monthly payments to $882 a month.

That is a little too rich for my blood and extremely high for a car that cost $48,300.


Hope this clarifies.

 

[kdryden99]

The Option Plan balloon payment for the $56440 MSRP ER AWD Premium (10,500 miles annually) $24,834. My true cost is $56,440-7,500-1,000 (option incentive) = $47,940. $24,834 would be 52% of true cost. Not 40%. Not 35%

By your numbers my payment would be on par with the Y and much more digestable. So for us canadians ill provide the math. I will use a conversion factor of 1.3 for U.S. to CDN$. 56440×1.3=73372 (on my build page its 71500 so close enough). 73372×.48=35218.56/48months=733.72/month. To show it matches the U.S. numbers 733/1.3=563$ so very close to the numbers obtained above. For those who will say there are taxes. Yes but the incentives here in QC basically covers those taxes. The only thing missing is do we get an incentive for going with options

 

[JTK44]

It isn't going to clarify because your numbers are wrong. The MME monthly would be $675.10, assuming that the Tesla Model Y lease doesn't include the $1500 CA Clean Air rebate, which it seems to. In this case the MME monthly would be $630.78, less than the Model Y lease.

Plus with Options you have a lower buy out price which is a big bonus. No comparison as to which would be better for most people.

Behold the right number:

Well it is good to see that you finally agree that the monthly payment on the Model Y is $633 a month.

This is a good place to start.

Glad to see you have finally posted how you arrive at your figures and we can now see your mistake and correct them.

You have overstated the down payment by $2500. To get the correct monthly payment you must reduce the down payment by $2500 to $5000:

This is obvious as your calculations include a $2500 incentive for vehicles, that require:

• "Not all buyers will qualify"
• "Take new retail delivery from dealer stock by 01/02/2021"

The MME is not in dealer stock: this incentive will not apply and further not all buyers will qualify. Therefore it is improper, a mistake, to include this $2500 incentive in your calculations.

As there is no way to remove this incentive from the calculations, to compensate for it, you must reduce the down payment by $2500.

When you do this the total "incentives" and down payment total $7,500, which equals the Federal Tax credit.


The monthly payment will be $748.96 the exact amount I have posted.

See below and attachment


Unless there is no sales tax in your state you must calculate the sales tax: In NY the sales tax is 8.625%

The option plan is a sale, the tax is on the sale price, 8.625% on $55,800 $4,812, $133 a month. month

The Model is a lease and the sales tax is computed on the sum of he monthly payments: $633, 36 months, $22,788, $1966, $55 a month.


When the sales tax is added into the monthly payment:

• Tesla Model Y $633 + $55, $688
• Premium LR AWD $748 + $133, $881

Over the term of the lease the MME will cost almost $7000, ($6948) more than the Model Y.

The nice thing about numbers is that they do not lie!



Ford Options Plan
Monthly Payment
$748.96/mo˜˜
APR 2.25%
Edit Monthly PaymentClose Summary
FORD OPTIONS PLAN PRICING SUMMARY

• Total Base MSRP (including optional equipment and D&D)``$55,800
• Total Available Incentives****
  • Ford Options Factors Actual price and payments may be different due to local rebates, specials, fees, and credit qualifications. Consult your dealer for actual price, payments, and complete details.2.25%
  • Ford Options Retail Bonus Cash Program #13770: $2,500.00 Ford Credit Bonus cash requires Ford Credit financing. Not all buyers will qualify. Take new retail delivery from dealer stock by 01/04/2021. See dealer for complete details.-$2,500
  • Total Available Incentives****-$2,500
• Down Paymentˆˆˆˆˆ$5,000
• Total Estimated Amount Financed˜˜˜$48,300
• Estimated Monthly Paymentˆˆˆˆ$748.96/MO
• Term (In Months)˜˜˜˜˜36
• Annual Miles~~~10500
• Estimated Final Payment to Own (Balloon Payment). See Disclaimer for more information.†††††$24,552
• Flexible choices are available to you to satisfy the final balloon payment:
  1. Return -- Hand the vehicle back to Ford Credit, an amount equal to your originally scheduled balloon payment will be applied to your account.
  2. Retain -- Purchase Outright or Refinance the Final Balloon Payment
  3. Renew -- Trade-in for a New Ford or Lincoln; any excess equity can be used toward your next purchase
• Watch a Video and learn more about Ford Options
  Payment calculations are estimates only

 

[Regularmache]

It's not about "showing faith"; it is a business decision with ramifications. If they set too high of a residual, people will certainly turn them all back in at the end and Ford credit will have a whole bunch available for sale - further driving down prices. It is also likely that by then (2024) there will be plenty of competition with BEV's that have even better/longer range batteries.

Even though they've been around for more than a decade, we are still in the early part of the curve with respect to improvements in efficiency and pricing. If you compare it to the early days of personal computers or digital cameras, anything 3 years old was so badly outclassed by the latest and greatest it was considered "junk" to be thrown away. I don't think they will be considered "junk" by any means, but they certainly will be superseded by the 2024 models. The big difference between PCs or cameras and the Mach E is that the latter will have at least a 10 year lifespan with minimal maintenance costs. I think that will keep used prices from cratering too much; people who can't afford a new car will easily be able to afford a used MME because of that limited maintenance cost compared to an ICE.

OMG I can remember asking my dad as a really young kid if I could use his car phone in his Lincoln! It was $2,500 in 1986 $2,500 in 1986 equivalent in purchasing power to about $5,939.51 in 2020!
Same with BEV, first one, EV1 was $299-547( or $497 -907 in 2020 $)a month with state and federal rebates for a 2 seater with 160 miles of range.

20 years later, more than double the passenger space, and almost double the range for less monthly payments! Additionally you can buy it. today's BEV it won't have to be given back to the manufacturer to be crushed!

 

[SoriceConsulting]

This lease talk has got my head spinning! Not sure, but the Options plan seems like it should be a decent deal for those of us in NJ - but I might be looking at the numbers wrong. Opinions / corrections welcome!

I ran 2 scenarios through leaseguide.com. Here is how I got my input numbers:
1. Prem/AWD/LR = $55,800 ($54,700 + $1,100 D/D)
Less X plan discount of $841 ($55,800 x 2% = $1,116, less $275 fee = $841)
Final Cost = $54,960 (55,800 - 841)
2. Fed credit = $7,500
3. NJ rebate = $5,000
4. Options incentive = $2,500 (not sure if I'll get this so I ran one with and one without)
5. NJ sales tax on purchase = $0 (NJ does not collect sales tax on EVs)

I used the $7,500 credit/ $5,000 rebate as down payment for scenario 1 ($12,500)
I used the $7,500 credit/ $5,000 rebate / $2,500 incentive for scenario 2 ($15,000)

Not exactly sure what the residual would be, so I used the one that appears in post #270 ($24,552)

So, at Options end, I've paid
> $20,241 (36 x 567.25) in scenario 1.
> $17,827.20 (36 x 495.20) in scenario 2.

And could then buy it for $24,552, for a total cost to own of
> $44,793.00 in scenario 1.
> $42,379.20 in scenario 2.

I could also get $24,552 towards a new MachE (or less, or more? Not sure - guess that would depend on the market value at the time? Or will Ford guarantee me $24,552 towards a new MachE? No idea if the residual would be a guaranteed amount on a trade in for another MachE).

I'm assuming my numbers are way off (never 'leased' in my life - always bought), since this looks like a pretty good deal for my situation.

Where am I going wrong?

Scenario 1:

Scenario 2:

 

[malba2366]

The MME is not in dealer stock: this incentive will not apply and further not all buyers will qualify. Therefore it is improper, a mistake, to include this $2500 incentive in your calculations.

If you take delivery of the car during the dates this incentive applies it is valid. The car enters dealer stock once the dealer takes ownership of the vehicle before you purchase it from the dealer. The dealer has no reason to deny you this incentive as ford is paying for it. This incentive is very obviously created to improve the options leasing program so that people will select it over the traditional lease. There is currently some uncertainty about the federal tax credit, and it being targeted towards certain income brackets...Ford does not want to end up on the losing end of this.

If the incentive was only valid on dealer ordered vehicles, why would they bother creating this incentive expiring in January...they know that only ordered vehicles will be sold during this timeframe.

 

[hybrid2bev]

I used the $7,500 credit/ $5,000 rebate as down payment for scenario 1 ($12,500)
I used the $7,500 credit/ $5,000 rebate / $2,500 incentive for scenario 2 ($15,000)

Where am I going wrong?

Scenario 1:

Scenario 2:

If these are traditional lease figures then I would try again with these corrections:

• Residual value should be around $29,700 @ 15k miles
• Interest rate to 5.4%
• Remove the $7500 tax credits from the down payment

 

[SoriceConsulting]

I'll be going with 10.5k miles (work from home). The 2.5% interest rate is from post #270 (which I should qualify for with my credit rating).

Why would I back out the $7,500? I know I'll qualify for it and I'd just 'front' the $7,500 and wait for the credit on my taxes - I always owe more than $7,500 :^(

 

[JTK44]

This lease talk has got my head spinning! Not sure, but the Options plan seems like it should be a decent deal for those of us in NJ - but I might be looking at the numbers wrong. Opinions / corrections welcome!

I ran 2 scenarios through leaseguide.com. Here is how I got my input numbers:
1. Prem/AWD/LR = $55,800 ($54,700 + $1,100 D/D)
Less X plan discount of $841 ($55,800 x 2% = $1,116, less $275 fee = $841)
Final Cost = $54,960 (55,800 - 841)
2. Fed credit = $7,500
3. NJ rebate = $5,000
4. Options incentive = $2,500 (not sure if I'll get this so I ran one with and one without)
5. NJ sales tax on purchase = $0 (NJ does not collect sales tax on EVs)

I used the $7,500 credit/ $5,000 rebate as down payment for scenario 1 ($12,500)
I used the $7,500 credit/ $5,000 rebate / $2,500 incentive for scenario 2 ($15,000)

Not exactly sure what the residual would be, so I used the one that appears in post #270 ($24,552)

So, at Options end, I've paid
> $20,241 (36 x 567.25) in scenario 1.
> $17,827.20 (36 x 495.20) in scenario 2.

And could then buy it for $24,552, for a total cost to own of
> $44,793.00 in scenario 1.
> $42,379.20 in scenario 2.

I could also get $24,552 towards a new MachE (or less, or more? Not sure - guess that would depend on the market value at the time? Or will Ford guarantee me $24,552 towards a new MachE? No idea if the residual would be a guaranteed amount on a trade in for another MachE).

I'm assuming my numbers are way off (never 'leased' in my life - always bought), since this looks like a pretty good deal for my situation.

Where am I going wrong?

Scenario 1:

Scenario 2:

I think you are 100% correct - subject to two caveats:

• We are assuming the interest rate will be 2.5%
• Unlike NJ, in most states there is sales tax on EV's. So anyone using this method should keep this in mind.

I am glad you used the above leaseguide.com which I always use.

I think it was very smart on your part to do two scenarios: with and without the $2500 option.

I agree with you: I do not know how Ford will treat the balloon: we know you can buy the car for the balloon, but I do not know if Ford will give you the balloon as a credit toward a trade or FMV.



I would add one scenario to your list: We know the Model Y leases for $633 a month, 36 months, total $22,788. We must then take the NJ, $5,000 from this to arrive at $17,788.

Good work!

 

[hybrid2bev]

I'll be going with 10.5k miles (work from home). The 2.5% interest rate is from post #270 (which I should qualify for with my credit rating).

Why would I back out the $7,500? I know I'll qualify for it and I'd just 'front' the $7,500 and wait for the credit on my taxes - I always owe more than $7,500 :^(

Maybe I misunderstood what you were doing. I thought you were calculating lease payments because you can quote Options payments via the build and price site.

The 2.25% rate is for Tier 0/1 on Options not lease. OK, yes you can put down $7500 out of your pocket but not the tax credits directly. Just don't want people to think that the $7500 tax credits can be directly applied at inception, you have to front the money in your scenario.

 

[JTK44]

If these are traditional lease figures then I would try again with these corrections:

• Residual value should be around $29,700 @ 15k miles
• Interest rate to 5.4%
• Remove the $7500 tax credits from the down payment

Just my observation:

Residual:

$29,700 represents a residual of 53% for 15,000 miles.

That would be a residual of 57% for 10,000 miles. That might be optimistic.

Interest rate:

Interest rate of 5.4% will blow the payments up: No one will lease if the interest is 5.4%.

Federal Tax Credit:

I get where you coming from: Assume that the residual is high as the tax credit is "baked in".

Without the tax credit, using a residual of 57% for 10K miles and an interest rate of 5.4% the monthly payments come to $811 plus tax.

That payment is a non starter:

 

[SoriceConsulting]

The residual number confuses me. Hasn't Ford already set that percentage? Isn't this the residual chart for the Option Program?:

If so, $55,800 at 40% is $22,320

Also confusing is the residual 'adjustment' Is that reflected in the numbers already or does Prem/AWD/3P mean 43%?

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