Does it really make sense to own the vehicle that you drive only because you have to, not because you want to? It’s debatable to some. My grandfather tried his best to convince me that leasing a vehicle would be the way to go in life, but the second my brain heard “mileage limits” I was completely against the idea, nevermind the idea of paying on something I’d never own. If I’m throwing good money at a car, I should expect to own it, like a house…right? Am I wrong in that thinking?
I must be, because a couple hours’ drive south of me in Nashville, BMW is kicking off a pilot program of offering a “subscription” to BMW models for a single monthly charge. The program itself has two levels: “Legend”, which opens up a wide array of the standard BMW fare plus such models such as the (deep breath) X5 xDrive40e iPerformance, M2, and 530e iPerformance hybrid. Or you pay a higher rate, and you open up the “M” level, which breaks out M4, M5, M6, X5M, and X6M. Again, you pay one monthly subscription fee…somewhere between $2,000 to the full-fat $3,700 fee for the M tier…and via a mobile app, you choose which car you want whenever. Want a small sporty rear-driver for city commuting for a week? Maybe an SUV that will somehow make you look environmentally friendly and a bit pretentious to boot? Just dial it up. To be fair about the price, though, it does include insurance, maintenance, and even tire replacement (for normal wear and tear, so calm down there, Hot-Shoe.)
Outside of the ability to basically drive the entire BMW range at your leisure, what is the point of this service? It’s a glorified rental program at best. But to some, maybe it does work out. Would you be willing to opt-in to such a service if the monthly cost was like a basic car payment? We aren’t talking any kind of hot rod or anything like that…for your daily beater, would you even consider something like this, or would you rather just buy it and be done with it?
Leasing a vehicle only works for companies that don’t have fleet maintenance. So your employees can beat a car into the ground without consequence.
For the individual, you want to own your car. Otherwise you have a permanent payment plan with mileage restrictions and everything else horrible that comes with it.
And at the end, they offer to sell you the car, at a price that’s only about 20% less than the cost of a new one. What sense does that make when you have already paid half the cost of the car over the 2 or 3 years you’ve been leasing it.
The monthly fee for one month is more than I paid for my daily driver. How does this make sense? My daily is boring but reliable. My daily and my wife’s daily combined cost $6800. I have owned them for 3 and 6 years respectively. How does 3 grand per month make sense to anyone?
Just like the big, fancy houses with no furniture. It’s all in the appearance on the outside to some people.
Man did you nail it !
Modern Americans have accepted car payments for eternity, so this may be profitable. My daily was paid for 4 years ago, my wife’s, paid cash, 11 years ago. so not much incentive for us!
Leasing a car, for someone who is already of the mindset to finance one anyway, is a great idea for MANY people. Not all, but most. If you have the right lease the car or trucks value at the end of the lease term will be the same as the payoff amount on it or more. If you have a truck that has a payoff amount of $10,000 at the end of the lease but is only worth $7000 you don’t buy it. Simple math. If you have purchased that same vehicle and it is worth less than you own on it then that is your problem and nobody is going to care. And while the mileage restrictions can be a problem for some people, they are not for everyone. And the tax benefits for many people will be much better than owning. WIth that said, I have never financed or leased a vehicle. My junk is either cheap junk or cash or both.
Cadillac already did this. its expensive as hell but is kinda a cool idea
Er, divide the price by 50? That would get me interested. Two of the high end of those BMW payments would about cover what I paid for my current daily driver two years ago and all the repairs and maintenance parts since then.
Leasing only makes financial sense if you have so much finance that the payments are a drop in the bucket compared to your income. When I hear of somebody who has a car payment of $600, I have to wonder just how unreliable a car would have to be to end up costing you that much in repairs, even if you can’t fix the car yourself and have a reasonably priced chain mechanic shop do the work. I’ve had some real garbage cars, but none that cost me that sort of monthly expenses.
Oh! It must be good because it involves your “smart” phone. Do everything with your smart phone and not think! It is the wave of the future….. :-/