BATTERIESRIT
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- First Name
- Joe
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- Feb 25, 2021
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- Iowa
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My Mach-E will have an MSRP of $56,640 with floor mats. With the X plan and the Ford Option $1,000 discount, the cost of my Premium is $54,782.. With the $7,500 federal tax credit (which is being taken now by reducing my 2021 estimated payment) my net cost is $47,282 if I paid cash.
The car has the following residual values based on 10,500 miles a year. This is the optional ballon payment at the end of 36 or 48 months.
36 months = 45% times $56,640 = $25,488 - The total I paid to Ford as a down payment and monthly payment excluding interest = $29,294.
($54,782 - $25,488 = $29,294)
48 months = 38% times $56,640 = $21, 523. - The total I paid to Ford as a down payment and monthly payments excluding interest =$33,259
($54,782 - $21,523 = $33,259)
One may say the depreciation rates are 55% (100% less 45% residual) for three years and 62% (100% less 38% residual) for three years. Maybe there are other possibilities.
So what is my true depreciation %? Is it the amount I paid to Ford as a down payment and monthly payments (excluding interest) divided by the net cost of my car after the $7,500 tax credit?
36 months = $29,294/$47,282 or 62% depreciation
48 months = $33,259/$47,282 or 70% depreciation
These do not look good so instead, should it be depreciation based on a different perspective by reducing my out of pocket costs paid to Ford (excluding interest) by the $7,500 tax credit?
36 months = $29,294 paid to Ford less tax credit of $7,500 = $21,794 net out of pocket cost divided by $54,782 or 40% depreciation
48 months - $33,259 paid to Ford less tax credit of $7,500 = $25,759 net out of pocket cost divided by $54,782 or 47% depreciation
I like this approach better. How about you? Or maybe one should calculate the out of pocket cost per mile instead of worrying about residuals and depreciation rates.
Of course, it depends on how you look at the federal tax credit. If the government expands federal tax credits, will this help the future value of our Mach-E’s or will it lower them if Tesla does not raise its prices so their cars become cheaper than the Mach-E?
In any event I am going with a four year option as the first three years cost me 40% depreciation or 13.3% a year. The fourth year is only 7%.
The car has the following residual values based on 10,500 miles a year. This is the optional ballon payment at the end of 36 or 48 months.
36 months = 45% times $56,640 = $25,488 - The total I paid to Ford as a down payment and monthly payment excluding interest = $29,294.
($54,782 - $25,488 = $29,294)
48 months = 38% times $56,640 = $21, 523. - The total I paid to Ford as a down payment and monthly payments excluding interest =$33,259
($54,782 - $21,523 = $33,259)
One may say the depreciation rates are 55% (100% less 45% residual) for three years and 62% (100% less 38% residual) for three years. Maybe there are other possibilities.
So what is my true depreciation %? Is it the amount I paid to Ford as a down payment and monthly payments (excluding interest) divided by the net cost of my car after the $7,500 tax credit?
36 months = $29,294/$47,282 or 62% depreciation
48 months = $33,259/$47,282 or 70% depreciation
These do not look good so instead, should it be depreciation based on a different perspective by reducing my out of pocket costs paid to Ford (excluding interest) by the $7,500 tax credit?
36 months = $29,294 paid to Ford less tax credit of $7,500 = $21,794 net out of pocket cost divided by $54,782 or 40% depreciation
48 months - $33,259 paid to Ford less tax credit of $7,500 = $25,759 net out of pocket cost divided by $54,782 or 47% depreciation
I like this approach better. How about you? Or maybe one should calculate the out of pocket cost per mile instead of worrying about residuals and depreciation rates.
Of course, it depends on how you look at the federal tax credit. If the government expands federal tax credits, will this help the future value of our Mach-E’s or will it lower them if Tesla does not raise its prices so their cars become cheaper than the Mach-E?
In any event I am going with a four year option as the first three years cost me 40% depreciation or 13.3% a year. The fourth year is only 7%.
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