Mach-E Financing and RCL Leasing Program Announced

[kdryden99]

Ah yeah you're right. I forgot you do not have Ford Options there.

Not publically, we'll see when i get there.

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[kdryden99]

But putting my situation aside. Don't you guys see something wrong witha manufacturer telling its clients "we expect this car to be worth only 35% in 4 years"?

 

[macchiaz-o]

But putting my situation aside. Don't you guys see something wrong witha manufacturer telling its clients "we expect this car to be worth only 35% in 4 years"?

I don't conflate residual value and market value.

 

[kdryden99]

I don't conflate residual value and market value.

ok so let me put it to you this way you get your car in december. I get mine March. We both ordered at the same time. I pay 5000$ less because of depreciation.

 

[macchiaz-o]

ok so let me put it to you this way you get your car in december. I get mine March. We both ordered at the same time. I pay 5000$ less because of depreciation.

Or you pay $5,000 more. Whichever. I'm not trying to guess future value here. My car is NOT a financial investment.

 

[JTK44]

But putting my situation aside. Don't you guys see something wrong witha manufacturer telling its clients "we expect this car to be worth only 35% in 4 years"?

OF course:

I Ford built a "home run" car, they could have reasonable expected it to holds its value.

When the manufacturer has a residual of 40% after 3 years, it is their admission that there is nothing to be excited about here.

You expect the minute you drive out the door the car being "used" will lose 10% to 15% of its value.

Just my opinion: anyone who buys a mainstream car knowing that it will lose 60% of its value in just three years is just throwing away money.

I understand buying an exotic car or a Bentley that losses 50% of its value in three years: they were extremely overpriced to begin with.

But 60% in three years is unheard of.

One caveat: if you buy the premium LR AWD for $55,800, 40% is $22,232. Your actually cost however will be slightly less:

• Sales tax on purchase price: $4812
• Federal Tax credit of $7,500

Net savings $2,688 so your actual out the door cost is $55,112.

Subtract residual value of $22,232 and your cost for three yeas $30,888 or $857 per month!

IMO that is an obscene amount to pay for a $55,00 car.

Again the MME is a lost leader: It will make every other SUV in the Ford dealership look cheap by comparison!

Or you pay $5,000 more. Whichever. I'm not trying to guess future value here. My car is NOT a financial investment.

You do know of course that for the vast majority of Americans, after a house their next single largest investment is their auto.

A car to me, unless it is a classic or exotic is a financial investment and I think for most people.

It seems pretty clear to me that you can no longer make a sound argument for the price of the MME.

IMO, when someone says that a car is not a financial investment, especially when it is extremely overpriced, that is a rationalization: at this point logic no longer prevails and emotions have taken over.

When emotions take over, sound decision are much harder to make.

Again just my $.02.

 

[macchiaz-o]

IMO, when someone says that a car is not a financial investment, especially when it is extremely overpriced, that is a rationalization: at this point logic no longer prevails and emotions have taken over.

When emotions take over, sound decision are much harder to make.

I completely agree.

The actors in this system who are behaving most logically, least emotionally, are folks who buy used cars and drive them into the ground.

 

[FredT]

I realize that I have been beating the horse to death and he is almost dead:

For the Premium LR AWD, the Option Plan, using the Federal Tax credit of $7,500 as a down payment has a monthly charge of $748.

The MSRP, or selling price is $55,800. As the option plan is a sale and not a lease, the sales tax due where I live, 8.625% is an additional $4812. I realize that some states, like New Jersey, waive the sales tax on an EV, but NY like most states do not.

That $4,812 divided by 36 is an additional $133 a month, bring the actual monthly payment to $881!

Considering that the Model Y with no money down is $633 plus tax of $55 a month, totals $688.

Does paying $200 a month more for the MME make sense to anyone? It surely does not to me.

PS: In those states that waive the sales tax on an EV, the difference is $115 ($748 vs. $633).

First, how do you get $748? When I plug in $7500 down on the Ford web site I get $675.

This thread has me totally confused. Let me try a few things out and see what you think.

I have no interest in the Model Y at any price, so I could not care less how low it's lease might be. A car that I am very interested in, however is the ID.4. A lease on the AWD version with Statement package is $519, or $563 with tax at the rate where I live. If I look Options with $11,000 down ($3500 to match the VW down payment plus $7500 for credit), I get $571, or $702 with tax, $140 more than ID.4. So then I have to decide whether the Mach-e worth $140 more than ID.4. Most here would say definitely yes. For me I'm not sure.

However, that VW lease doesn't seem very good to me. My last lease of an Audi PHEV about four years ago, a car of roughly the same value as the ID.4, was $100 a month less. If I adjust the down payment to approximate the same value with ID.4, the Options payment becomes $510 with tax, $50 less than ID.4. So maybe Options isn't so bad? What do you think?

 

[Dudeduke]

That’s my point, the market determines the value. In that instance it’s better to have set a lower residual on your contract so that when the balloon is due you owe less.

This is better for Ford and not for the buyer. Specially if the person leasing is not planning to buyout in the end.

Ford doesn't want to stand behind the product and assuming it will depreciate as a low range compliance ev car. They need to show the confidence in the car and predict it to be in equal demand 3 years from now as a model y would be. I don't think i am asking too much here.

Low residual also make the financed amount higher for the lease term making more profit in terms of interest for them.

Also most of the leasors don't even bother looking at buying out/ trade-in to see if there is some money on the table at the end of term. So it is a win win for ford to keep a low residual if buyers are ready to do that.

Another thing i am currently dealing with ford credit that they don't allow trading in a leased car unlike all other manufacturers financials. So if the market value of leased vehicle nis more than the residual, you can't just trade in anywhere, and keep the extra money. You have buyout the car and then you can trade-in for Ford, which make is harder and also has to pay tax on the residual that you loose if you sell it or trade in.

Ford is not helping the customers with their leasing policies

Market will dictate eventually, but early leasors will be taking a higher risk.

 

[kdryden99]

First, how do you get $748? When I plug in $7500 down on the Ford web site I get $675.

This thread has me totally confused. Let me try a few things out and see what you think.

I have no interest in the Model Y at any price, so I could not care less how low it's lease might be. A car that I am very interested in, however is the ID.4. A lease on the AWD version with Statement package is $519, or $563 with tax at the rate where I live. If I look Options with $11,000 down ($3500 to match the VW down payment plus $7500 for credit), I get $571, or $702 with tax, $140 more than ID.4. So then I have to decide whether the Mach-e worth $140 more than ID.4. Most here would say definitely yes. For me I'm not sure.

However, that VW lease doesn't seem very good to me. My last lease of an Audi PHEV about four years ago, a car of roughly the same value as the ID.4, was $100 a month less. If I adjust the down payment to approximate the same value with ID.4, the Options payment becomes $510 with tax, $50 less than ID.4. So maybe Options isn't so bad? What do you think?

I cant compare to the ID.4 because ill only get the pricing next year. But id like to try to understand. The 11000$ you put down why are you adding 3500$ to the existing 7500$?

 

[JTK44]

You‘re on to something!

I think Ford secretly beta tested this approach with the First Edition ”price cut.”

For those not scared away by the steep price and low projected resale of the Mach, dealers can now show what a bargain the Premium is over the FEs. They’ll even have some cancelled FE orders on the lot to show for comparison. Even better, the dealer will have a nice ‘market adjustment’ price next to the window sticker for those highly collectible and scarce limited edition FEs to make the alternatives even more compelling.

Its all starting to make sense now.

And my First Edition will probably be shown prominently next to the Shelby GT 500, with a $20,000 ADM, in the dealer showroom!

Both are lost leaders and make every other car look "cheap" by comparison!

That may explain the limited volume as well: Ford figured we are not going to sell these turkeys at this price, so make only a few to satisfy those who "must have a Mustang" regardless of price and use the rest to get people into our showroom!

Great Marketing strategy by Ford!

 

[DBC]

But putting my situation aside. Don't you guys see something wrong witha manufacturer telling its clients "we expect this car to be worth only 35% in 4 years"?

I see a problem with people bitching about things when they have no reasonable basis to bitch.

1. You have arrogated to yourself the right to decide which vehicles are similar. For several reason -- including ride and reliability -- I don't think the Model Y is all the competitive with the MME. You seem to think otherwise. That's fine because it's your money and you have a right to your opinion. But it's my money and I have a right to my opinion, so stop trying to force your opinion on me.

2. The corollary is that bitching about the terms and conditions of the sale is a waste of time. The cold reality is that Ford gets to set the terms of a sale and you are free to to take it or not. If you think the Model Y is a better deal, get it. No one is holding a gun to your head and forcing you to get a MME. No purpose is served, including helping your mental state, by your continued bitching about something over which you have no control. Everyone understands that you want to pay less. Me too.

3. On the specifics of the bitching, as mentioned ad nauseam, a contract residual and the FMV at the end of the lease are not the same things. If you think you will want to keep the car then you want a low residual. If you don't then you want a high residual. But in neither case does the residual necessarily reflect FMV at the end of the lease.

4. On the specifics of the bitching, if the tax credit is treated as a reduction in MSRP, which is what it is, then the residual in three years is 55% and in four years 45%. That seems fair and hardly objectionable.

5. On the specifics of the bitching, the "lease" payment on a Model Y is not all the different from a lease payment on a MME. Seems to be less than fifty bucks (if you subtract out the incentives included for both the Model Y and the MME). And that is before you include the hands free driving option. Do that and the Model Y payments are more than the MME payments plus the hands free driving subscription.

6. On the specifics of the bitching, you have far more options with the MME. If the payments on a Premium with AWD and an extended battery are too high, go with a CA Route 1 or a Premium with a standard battery. The payments will be less. Nice you have those "options".

7. On whether the Model Y is comparable to the MME, there are advantages in not leasing the least reliable vehicle on the market. I don't want to be bothered taking a new car in to get a door adjusted, much less having to put up with multiple attempts to fix a door that doesn't work.

 

[macchiaz-o]

Let's try and stay civil, and work towards friendly conversation even when we disagree.

 

[Dudeduke]

I see a problem with people bitching about things when they have no reasonable basis to bitch.

1. You have arrogated to yourself the right to decide which vehicles are similar. For several reason -- including ride and reliability -- I don't think the Model Y is all the competitive with the MME. You seem to think otherwise. That's fine because it's your money and you have a right to your opinion. But it's my money and I have a right to my opinion, so stop trying to force your opinion on me.

2. The corollary is that bitching about the terms and conditions of the sale is a waste of time. The cold reality is that Ford gets to set the terms of a sale and you are free to to take it or not. If you think the Model Y is a better deal, get it. No one is holding a gun to your head and forcing you to get a MME. No purpose is served, including helping your mental state, by your continued bitching about something over which you have no control. Everyone understands that you want to pay less. Me too.

3. On the specifics of the bitching, as mentioned ad nauseam, a contract residual and the FMV at the end of the lease are not the same things. If you think you will want to keep the car then you want a low residual. If you don't then you want a high residual. But in neither case does the residual necessarily reflect FMV at the end of the lease.

4. On the specifics of the bitching, if the tax credit is treated as a reduction in MSRP, which is what it is, then the residual in three years is 55% and in four years 45%. That seems fair and hardly objectionable.

5. On the specifics of the bitching, the "lease" payment on a Model Y is not all the different from a lease payment on a MME. Seems to be less than fifty bucks (if you subtract out the incentives included for both the Model Y and the MME). And that is before you include the hands free driving option. Do that and the Model Y payments are more than the MME payments plus the hands free driving subscription.

6. On the specifics of the bitching, you have far more options with the MME. If the payments on a Premium with AWD and an extended battery are too high, go with a CA Route 1 or a Premium with a standard battery. The payments will be less. Nice you have those "options".

7. On whether the Model Y is comparable to the MME, there are advantages in not leasing the least reliable vehicle on the market. I don't want to be bothered taking a new car in to get a door adjusted, much less having to put up with multiple attempts to fix a door that doesn't work.

Can you explain why ford is setting the residual so much lower than a model y if you and they think MME is a better and reliable vehicle?

Their actions are saying the actual opposite, and they believe their vehicles will be worth way less compared to tesla 3 yrs from now. The comparison is due tot the fact they are both in same category and MME is trying to complete with them. I really want MME to do well and be better than Model Y, but it seems Ford themselves don't believe that.

 

[Barno]

I realize that I have been beating the horse to death and he is almost dead:

For the Premium LR AWD, the Option Plan, using the Federal Tax credit of $7,500 as a down payment has a monthly charge of $748.

The MSRP, or selling price is $55,800. As the option plan is a sale and not a lease, the sales tax due where I live, 8.625% is an additional $4812. I realize that some states, like New Jersey, waive the sales tax on an EV, but NY like most states do not.

That $4,812 divided by 36 is an additional $133 a month, bring the actual monthly payment to $881!

Considering that the Model Y with no money down is $633 plus tax of $55 a month, totals $688.

Does paying $200 a month more for the MME make sense to anyone? It surely does not to me.

PS: In those states that waive the sales tax on an EV, the difference is $115 ($748 vs. $633).

Hi. Are you factoring in the $2500 incentive (purchase)and the $2000 NY state rebate?

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