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TheLight75

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Ford isn't going to have much of a choice but to use the $7,500 as a cap reduction on the lease. Yes, they can do any of a number of things to factor it in, but at the end of the day what matters most is public perception. Most people need things very plainly laid out to show a short-term benefit versus a long-term benefit. This is demonstrated by low EV adoption in cities even though frequently the TCO over the lifetime of the EV is cheaper than an ICE vehicle.. But most buyers can't get past the higher up-front cost.

Ford can't afford for the MME to fail so in order to be competitive, they'll have no choice but to use the $7,500 tax credit as a cap reduction. Otherwise, EV buyers who are willing to consider other brands will simply pick a different model.
 

agoldman

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Ford can't afford for the MME to fail so in order to be competitive, they'll have no choice but to use the $7,500 tax credit as a cap reduction. Otherwise, EV buyers who are willing to consider other brands will simply pick a different model.
So could you lease for a month, and then pay it off ($7500 less payoff) and that way get the $7500 in 2021? Assuming no pre-payment penalty.
 

JTK44

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The tax credit is already baked into the residual percentage at 55%. Having a 55% residual and also applying as a cap cost reduction would be double dipping the tax credits.
I totally disagree:

The Federal Tax rebate has nothing to do with the residual.

I have been leasing for over 35 years. I know of no car that on a 3 year lease, 10 miles per year has a residual below 55%. All the cars I have leased including my 2018 Ford Edge Sport have residuals at 55% or higher.

55% residual for 3 years, 10K per year is the lowest I have ever seen. On most leases the residual is higher. No one would ever lease with a 44% residual: the payments would be too high.

Using The Ford Option Plan with a balloon of 44% is a "red herring" and non starter. Ford and everyone else knows this.

IMO, there is no "double dipping": the residual of 55% is the minimum and you are entitled to the Fed credit of $7,500 as a cap cost reduction.

Without the Fed Credit of $7,500 as a cap cost reduction, as I posted above, the lease on the MME is non competitive with the Tesla Model Y.
 

kdryden99

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Here in Canada the Model Y is 740+tx=850$/month with 5250$ down. The MME with what was published would come out to over 1k$/month for 48months with the Ford options plan using my 8000$ provincial subsidy as down payment. I'll wait and see what my dealer offers before I pass judgment.
 
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hybrid2bev

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I totally disagree:

The Federal Tax rebate has nothing to do with the residual.

I have been leasing for over 35 years. I know of no car that on a 3 year lease, 10 miles per year has a residual below 55%. All the cars I have leased including my 2018 Ford Edge Sport have residuals at 55% or higher.

55% residual for 3 years, 10K per year is the lowest I have ever seen. On most leases the residual is higher. No one would ever lease with a 44% residual: the payments would be too high.

Using The Ford Option Plan with a balloon of 44% is a "red herring" and non starter. Ford and everyone else knows this.

IMO, there is no "double dipping": the residual of 55% is the minimum and you are entitled to the Fed credit of $7,500 as a cap cost reduction.

Without the Fed Credit of $7,500 as a cap cost reduction, as I posted above, the lease on the MME is non competitive with the Tesla Model Y.
The tax credit is being used to raise the Mach-E residual value higher than it would have been without it.

The 2020 Q4 36 month residuals @ 15k miles on a Ford Edge right now range from 43% to 46% (depending on trim), Mustangs are 42% to 47% at 36 months. Add 3% to each if doing 10,500 miles. So still at or below 50% residuals on ICE vehicles today.

Also the 55% for the Mach-E is at 15,000 miles per year. You need to add points to it if doing lower mileage per year or deduct if doing higher per year.
 

JTK44

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The tax credit is already baked into the residual percentage at 55%. Having a 55% residual and also applying as a cap cost reduction would be double dipping the tax credits.
My starting point is the Tesla Model Y is the standard. Everything else, including the MME is the competition:

The Pros of the Model Y as compared to the First Edition which I have ordered are:

Pros of Model Y:

  • Range: 326 vs. 270 miles
  • Acceleration
  • Handling: this may change once we have independent reviews of the MME. To date all we have are postings from employees of Ford - hardly the most reliable source!
  • Price: $49,995 vs. $59,400 First Edition less Fed credit $7,500 = $51,990
  • Charging infrastructure
  • Lease of $633 a month, no money down, 36 months, 10K per year
Pros of MME First Edition:

  • Styling both inside and out
  • Quality control
  • Interior layout of the dash
  • Dealer network: but the low volume of the MME may make the MME an "orphan" at many dealerships
  • Parts availability: this is subject to confirmation

To me, the pros and cons are pretty much equal. Without the $7,500 tax credit I would not pay nearly $10,000 more for the First Edition over the Model Y. Nor do I think anyone else would.

Without the Federal Tax Credit, again only my opinion, for those of us that need AWD the Model Y is the clear choice. With the Tax credit the choice is not as clear.

Bottom line: whether you buy or lease without the Federal Tax Credit of $7,500, the Model Y is the clear winner. To be competitive the MME must have the tax credit - and that is true whether you buy or lease.

To lease you need a reasonable residual, minimum 55% and the Federal Tax Credit included in the lease.

.
 
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hybrid2bev

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My starting point is the Tesla Model Y is the standard. Everything else, including the MME is the competition:

The Pros of the Model Y as compared to the First Edition which I have ordered are:

Pros of Model Y:

  • Range: 326 vs. 270 miles
  • Acceleration
  • Handling: this may change once we have independent reviews of the MME. To date all we have are postings from employees of Ford - hardly the most reliable source!
  • Price: $49,995 vs. $59,400 First Edition less Fed credit $7,500 = $51,990
  • Charging infrastructure
  • Lease of $633 a month, no money down, 36 months, 10K per year
Pros of MME First Edition:

  • Styling both inside and out
  • Quality control
  • Interior layout of the dash
  • Dealer network: but the low volume of the MME may make the MME an "orphan" at many dealerships
  • Parts availability: this is subject to confirmation

To me, the pros and cons are pretty much equal. Without the $7,500 tax credit I would not pay nearly $10,000 more for the First Edition over the Model Y. Nor do I think anyone else would.

Without the Federal Tax Credit, again only my opinion, for those of us that need AWD the Model Y is the clear choice. With the Tax credit the choice is not as clear.

Bottom line: whether you buy or lease without the Federal Tax Credit of $7,500, the Model Y is the clear winner. To be competitive the MME must have the tax credit - and that is true whether you buy or lease.

To lease you need a reasonable residual, minimum 55% and the Federal Tax Credit included in the lease.
Truly, thank you for sharing that. The Mach-E teams are watching and looking on here for feedback on RCL and Options.
 

AndyS_OSU

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I totally disagree:

The Federal Tax rebate has nothing to do with the residual.

I have been leasing for over 35 years. I know of no car that on a 3 year lease, 10 miles per year has a residual below 55%. All the cars I have leased including my 2018 Ford Edge Sport have residuals at 55% or higher.

55% residual for 3 years, 10K per year is the lowest I have ever seen. On most leases the residual is higher. No one would ever lease with a 44% residual: the payments would be too high.

Using The Ford Option Plan with a balloon of 44% is a "red herring" and non starter. Ford and everyone else knows this.

IMO, there is no "double dipping": the residual of 55% is the minimum and you are entitled to the Fed credit of $7,500 as a cap cost reduction.

Without the Fed Credit of $7,500 as a cap cost reduction, as I posted above, the lease on the MME is non competitive with the Tesla Model Y.
This. All of this. Like I said, my BMW i3 and BoltEV had residuals over 60%. I’m sure that was with the tax credit baked in but it made the lease affordable.

And before the “maybe you can’t afford this car” crowd gets here, I can afford $800/mo for a car but I don’t want to. The bigger, idealistic goal would be to put more electric cars on the road. We have to mainstream these things to really move the needle. After 6 years of BEV leasing it would be nice to see them start coming into more affordable territory for the masses.

Back to the numbers, 57% residual at 10k miles per year isn’t terrible but if that is coupled with a .00215 money factor plus TX sales tax, we’re still looking at over $800 to lease.
 

JTK44

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The tax credit is being used to raise the Mach-E residual value higher than it would have been without it.

The 2020 Q4 36 month residuals @ 15k miles on a Ford Edge right now range from 43% to 46% (depending on trim), Mustangs are 42% to 47% at 36 months. Add 3% to each if doing 10,500 miles. So still at or below 50% residuals on ICE vehicles today.

Also the 55% for the Mach-E is at 15,000 miles per year. You need to add points to it if doing lower mileage per year or deduct if doing higher per year.

You are correct about the residuals on the 2020 models: Adjusting the 46% to 10,000 miles brings you up to 47 to 50% 2% per 2,500 miles.

However, the mistake you are making is comparing residuals on last year's model the 2020 with residuals on the current year's model, the 2021 which will be higher. The MME is not a 2020 but a 2021.

When I leased my 2018 Ford Edge Sport, the 2019 were already in the dealership. There was virtually no difference between the 2018 and 2019.

In order to move the 2018, and because the residuals on the 2018 were lower than on the 2019, the dealer gave me incentives, rebates, etc. that totaled over $8,000 vs. $2,500 on the 2019. That extra $5,500 in incentives was far greater than the savings between a residual of 51% (2018) and 55% on the 2019. The lease on the 2018 Edge Sport was more than $80 cheaper than the same lease on the 2019 Edge Sport.

So in comparing residuals it is important to compare new model vs. new model not last year's model vs. this year's model.
 

First Edition

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My starting point is the Tesla Model Y is the standard. Everything else, including the MME is the competition:

The Pros of the Model Y as compared to the First Edition which I have ordered are:

Pros of Model Y:

  • Range: 326 vs. 270 miles
  • Acceleration
  • Handling: this may change once we have independent reviews of the MME. To date all we have are postings from employees of Ford - hardly the most reliable source!
  • Price: $49,995 vs. $59,400 First Edition less Fed credit $7,500 = $51,990
  • Charging infrastructure
  • Lease of $633 a month, no money down, 36 months, 10K per year
Pros of MME First Edition:

  • Styling both inside and out
  • Quality control
  • Interior layout of the dash
  • Dealer network: but the low volume of the MME may make the MME an "orphan" at many dealerships
  • Parts availability: this is subject to confirmation

To me, the pros and cons are pretty much equal. Without the $7,500 tax credit I would not pay nearly $10,000 more for the First Edition over the Model Y. Nor do I think anyone else would.

Without the Federal Tax Credit, again only my opinion, for those of us that need AWD the Model Y is the clear choice. With the Tax credit the choice is not as clear.

Bottom line: whether you buy or lease without the Federal Tax Credit of $7,500, the Model Y is the clear winner. To be competitive the MME must have the tax credit - and that is true whether you buy or lease.

To lease you need a reasonable residual, minimum 55% and the Federal Tax Credit included in the lease.

.
I haven’t checked, but perhaps RCL will have the same $2500 incentive as does Options and traditional Ford Credit financing.

The FE also probably isn’t the best comparison to the Y because we’re paying a huge premium for red calipers and stitching.
 

JTK44

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This. All of this. Like I said, my BMW i3 and BoltEV had residuals over 60%. I’m sure that was with the tax credit baked in but it made the lease affordable.

And before the “maybe you can’t afford this car” crowd gets here, I can afford $800/mo for a car but I don’t want to. The bigger, idealistic goal would be to put more electric cars on the road. We have to mainstream these things to really move the needle. After 6 years of BEV leasing it would be nice to see them start coming into more affordable territory for the masses.

Back to the numbers, 57% residual at 10k miles per year isn’t terrible but if that is coupled with a .00215 money factor plus TX sales tax, we’re still looking at over $800 to lease.
Bolt:

I thought GM had used up their credits. If that is so, the 60% residual on the Bolt would be without the the Federal Tax credit. In addition there are incentives on the Bolt.


BMW i3:

i3's are on the dealer's lots begging for buyers. In addition to residuals of 60% there are substantial discounts that exceed the Federal Tax credit!

Audi and Jaguar:

Leases on eTron and iPace have residuals in the 50% range, contain a cap cost reduction of $7,500 and are heavily discounted.

If you lease I sincerely hope you do not believe that the Fed tax credit of $7,500 is already "baked into" the lease because of the 55% residual. I for one am not interested in a lease with a residual of 55% unless the Federal Tax credit is put in as a cap cost reduction.

The lease on a Model Y, LR AWD, before taxes is $633, with taxes just under $700 a month. Above you posted over $800 a month for the MME assuming 57% residual more if 55%.

That monthly lease payment is not competitive.

I know this and Ford knows this as well.
 

methorian

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I haven’t checked, but perhaps RCL will have the same $2500 incentive as does Options and traditional Ford Credit financing.

The FE also probably isn’t the best comparison to the Y because we’re paying a huge premium for red calipers and stitching.
I was holding out hope we'd get some sort of surprise for FE buyers to make up for that large price difference after the price reduction was announced, but I guess it is what it is...
 

JTK44

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I was holding out hope we'd get some sort of surprise for FE buyers to make up for that large price difference after the price reduction was announced, but I guess it is what it is...
Originally the price difference between the FE and Premium AWD LR was $1600. After the price reductions it is now $3600.

I am willing to pay extra for the FE over the premium but not $3600.

When the leases come out I will see what the monthly payment difference is. Maybe the FE will have a higher residual or there may be incentives not available to the Premium.

We will know in a few weeks!
 

jdmrc93

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Originally the price difference between the FE and Premium AWD LR was $1600. After the price reductions it is now $3600.

I am willing to pay extra for the FE over the premium but not $3600.

When the leases come out I will see what the monthly payment difference is. Maybe the FE will have a higher residual or there may be incentives not available to the Premium.

We will know in a few weeks!
I'm hoping for the full self driving addition to be included. That's the least they could do.
 



 









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