rjharmel

I am a potential buyer of my first Lexus. On my radar screen is a loaded 2004 GS430 with an MSRP of $54,549. Invoice is $46,831. Cap cost is $48,821. The local dealership indicated that Lexus has an incentive program each year with special leasing programs-- December to Remember. I asked them for the lease details based on 36 months at 12,000 miles per year (36K miles total). I live in Southern California.

The dealer quoted me a monthly payment based on a money factor of .00184 and a residual of $31,093. The money factor works out to be the equivalent of about 4.42% APR (MF x 2400). The residual implies a factor of .57 (31,093 = 0.57 x 54549).

Can anyone shed any light on the 'attractiveness' of these leasing terms as they apply to Lexus? Of particular question is the $31,093 residual value after only 36 months/36K miles. Is it reasonable to expect that this Lexus will lose as much as 43% of its value in just 36 months? I'd expect that Lexus plays with the leasing factors to protect itself and make some money, but this seems a bit extreme.

Also, is the cap cost of $48,821 (the 'sales' price based on MSRP/Invoice of $54,549/$46,831) in line with what folks are paying these days for what appears to be the last year for this vehicle before a major change with the 2005 model year?

Thanks for any insight and perspective.

3dog

iTrader: (1)

those numbers look like what i'd expect to see. i hate figuring in depreciation in addition to my monthly payment. so you lose over $17,000 over 3 years. thats roughly $500 every month on top of that you've got the payments. cars are so depressing when you figure out how much you're spending on them, and you never recoup what you spend. and when you lease a car then there is the problem of modding them. if you leave the mods on the car at the end of the lease you get nothing for them. plus some mods will void your warranty. now i'm bias but here is my suggestion; get a 1999 or 2000 gs 400 you've already lost a large part of the depreciation you can pick one up for $25 to $30k. then you can mod like crazy & the warranty won't matter as it will be out or almost out of warranty. the car is so reliable i would'nt worry one bit about anything breaking. and the car will be yours to keep and treasure for many years. with propper mods the car will become one you would be very reluctant to ever give up.

chaskim

rjharmel
I hate to say this but just buy the car or look at another GS 430 about two years or evena year older. Why? I'll fall in love with the car and never want to give it up and then you'll be stuck in a lease that you can't possibly buy your way out of without looseing another $5K to $7K. It will be a bitter sweet love and besides if you really want a new GS 430 at a good price hold on until the NEW GS 2005 come out on 2004 mid summer and deal all you want but be warned you may want a NEW GS 2005 model. Although pictures have not been release you can put your mind to rest that CLUB LEXUS members will be posting pictures as soon as they are availible.

Take care and choose wisely,
chaskim

doug_999

Last year when I leased my GS430, the 39 month residual was the same as the 36. This was part of the Lexus Dec to remember sales event. Ask your dealer if that is the case now, if so you can lower your payments by going with a 39 month lease as opposed to a 36 month lease. HOWEVER, if you end up hating the car (as I do) then you are stuck with it for an additional 3 months

BTW, it looks like the residual is down about 3 points compared to last year. However 57% is still decent although not up there with BMW and Acura.

Iceman

Why do you hate your GS430? There are ways to get out of a lease early without taking a financial bath. I left my BMW about 6 months early by forcing the Lexus dealer to pay my remaining payments as part of the deal to buy my GS. If you go for the same manufacturer (i.e. if you get a different Lexus), they will very often simply forgive the remaining part of the lease to get you into a new vehicle.

JDZ25

Rjharmel, excuse my ignorance on this subject, and I hope you dont mind me asking, but how much would your monthly payment be?

Also, would anyone else who lives in NY know if Lexus still leases cars to NY residents? I have heard that some companies no longer offer traditional leases on their autos as a result of potential liability issues.

Thanks for your help.

doug_999

I hate my GS for a couple of reasons. There are however two primary reasons -make that three
1. Engine tick. Dealers claim it is the fuel injectors although no other GS430 or any Lexus has the issue like my car.
2. Steering - way over boosted. Once again, I have driven other GS430s and the steering is tighter. But try telling a Lexus dealer that your steering is over boosted. They think you are kidding. I know there is a pretensioner adjustment, just that none of the dealers know about it.
3. The Dealer network. One dealer said my engine tick was bad gas (even though I had Amoco Ultimate in there), the next dealer tried that and then said it was just the fuel injectors and that was normal (I don't understand why fuel injectors get quiet when the car warms up). Basically, the dealers don't want to do anything - personally, I don't think they know how to fix a car since Lexus' tend to be so reliable.

Like I said, when I drive other GS430s they don't have these symptoms. My next call is to Lexus customer service.

Oh and BTW, I went by the BMW dealer today. My 2003 GS430 with 12,000 miles is worth $36,500. Ouch.

rjharmel

Hello JDZ25 - With $1,120 drive-off (including $600 acquisition fee), the monthly payment is about $700.

Iceman

That is, of course, horsepuckey. Dealers always low-ball you on trade-in estimates, especially with a car that's not their brand. You'd do better, for example, at a Lexus place, but it sounds like you're pretty fed up with Lexus customer service right now. Still, that BMW place is screwing you over. I just ran a TMV at Edmunds and (assuming your car is in good shape and loaded up like all GS430's) the trade-in value should be worth more than $6,000 more than that offer.

doug_999

Iceman
I totally agree - obviously that was a lowball number. But I did run the numbers on KBB and they were very close to what they said $37K ish. Obviously it is not a Lexus issue, it is a luxury car issue - they depreciate something fierce in their first year. I am actually going to write to Lexus customer service and tell them I would like my issues fixed (well the engine ticking at least) or I want out of my lease. Honestly, this would be a decent car if I could just get that damn engine tick fixed.

JDZ25

Thanks rjharmel for your honestly. I wish you the best with your decision. One question for you though.

Do you need to buy a car right away?

I am not sure what your situation is, but before you purchase/lease a GS you might want to wait another month or so. Hopefully, the next gen GS will be displayed at the 2004 Detroit Auto Show. There has been a ton of speculation about what the new GS might look like and what features it might possess. Unfortunately, no one seems to know for sure as Lexus has been extremely tight lipped with the relevant details.

I know this would result in you potentially losing the special incentives in the December to Remember sales event, but, the new GS might just be worth the wait.

doug_999

I don't think the new GS will be out until fall of 2004. Even then, you will pay close to sticker and who knows what the residual will be. I can assure you that the monthly lease cost will be more than it is this Dec however.

Iceman

That sounds like a good approach at this point. They SHOULD do right by you (passionate pursuit of perfection and all that...), and hopefully they'll just fix it and make you happy. Just in case, though, I would think about another model of Lexus that you like in case they offer to buy out your current lease and put you in a new one.

chaskim

doug_999
Hey that ticking noise is it all the time? Or just when you take off from a stop? I'm asking because every once in a while sometimes I get a ticking noise that sounds like if you stick a pice of paper into moving fan blades but it only lasts about 3 sec. which isn't long but enough to drive me crazy

Chaskim

doug_999

All the time. As I mentioned in my PM to you, I'm pretty sure it is one bad injector or one bad lifter. If it was all of the injectors the noise would be unbelievable. Since it matches about what one injector/lifter would sound like, my thought is to have them replace all four of the injectors on the passenger side since that's where the noise is coming from - or buy me out of the lease