SaintNexus

My girlfriends family is looking to lease a new car, and I suggested a few models from different makes, and as I was browsing, I just came across this:

http://www.infinitiusa.com/current-o...Home_Page.Home.

I thought the 2012 Lexus IS250 lease special was a great deal, with $2,999 down and $329 a month for 27 months.

But Infiniti is offering their 2012 Infiniti G25/37 sedan with $1,799 down and $289/$319 a month for only 18 months!!

That's insane.

Which brings me to my question: Why are they doing this? Why such a short term?

I haven't really been keeping up with any Infiniti news, so seeing this is just shocking.

PhilipMSPT

iTrader: (5)

Because no one is buying it.

And both the IS and G deals involve down payments that break down to $100 a month on the lease: $2999 for 27 months, and $1799 for 18 months. At the end of the day, you're paying practically the same monthly for the IS and G when you count the down payment in the equation.

caddyowner

There are probably some good deals on the 2012 ES350 also.

xsh0tya

Its a buyers market, win for us.

dmvp29

Well, it's a well-known fact that leasing is almost always more expensive than buying a car outright, especially if you keep the car for 10-12 years.

Hell, if you buy a car outright and keep it for 12-15 years, you don't even need to make anything back on resale to win out over leasing a comparable car every 3 years.

I mean what's more expensive, leasing a new G37 every 18 months for 9 years ( = $44,928 and obviously you don't own a thing at the end of your third lease term) or buying the same car outright ($38,695 MSRP excluding TTL, so let's call it $40,000 even), keeping it for 9 years

Say you're lucky and you can expect a 6% ROI from the stock market every year. Roughly speaking, the additional "cost" of paying $40k up front is as follows -

2000 = (($40,000 - (down payment + 12*monthly payment))*.06), 1500, 1300, 1000, 900, 800, 600, 500, 500 = $9100.

So the final cost of buying outright is ($49,100 - resale value of an infiniti g37 after 9 years).

A 9 year old G35 with 180,000 miles is going for around $9,000 right now, so let's use that figure as a conservative estimate for resale value of a G37 after 9 years (even though a G37 would probably have slightly higher value)

Final cost of buying outright = $49,100 - $9000 = $40,100
Final cost of leasing = $44,928

And that's just 9 years of ownership. The difference typically becomes more pronounced (despite resale value plummeting annually) if you keep it even longer.

dmvp29

Oh, and bear in mind, that's with buying a brand new vehicle outright. The really financially savvy people tend to buy slightly used cars and keep them for ~10 years, taking advantage of the 30%+ hit in market value once a brand new car is driven off the lot.

Mixman

The reason Infiniti is doing this is because the G37 Sedan and Coupe is about to get a refresh next year . The low rates are to get people into the cars for a short time, then when the new models come out get them into those.

Since I own a G and am very hesitant to lease a new one for 39 mos, this is better suited for guys like me, where I can get in for 18 or 24 months and then get the new one in 2014.

xsh0tya

Yup, for those who want the best bang for the buck!

KillaIS250

iTrader: (1)

Yep my thoughts are the same. Many Infiniti's (like BMWs) are leased. If they can get you into the car now and you enjoy it, you're more likely to sign a new lease on the newer model that will probably be on the showroom floor when your lease is up

patgilm

I have to do some research about leasing vs. buying. I get tired of my cars around year 3-4 and trade them in. If you lease it seems you don't have to worry about depreciation, loss of value for minor accidents, etc. I think I may lease my next car just because of that and the fact that maybe I won't be so particular about my cars.

grabber2

I need to add something to this which I fell leasing has a better value now

1. Your final leasing cost was only about $5k for 9 years
2. Lease have lower down payment, less upfront cost + tax
3. Full warranty through the lease
4. No maintenance or tune-up cost (except for oil change), most car will require some repair/tune up after (5 years). ex. Tires, brake, belts, & etc
5. You get new ride every 3 years (ex. on the 3rd lease, I'm driving a all new 2012 car vs a 6~9 years old car)
6. Since it require full insurance coverage, peace of mind (since I always get full coverage)
7. You are lucky to get $9k out of 9 years old car with over 100K mileage

However, this is base on personal preference & entry level luxury car.

If I want a new entry level car like 3 series/C-class/G37, I will lease due to the above reason.

If new car is not require, I prefer used car for better resale value

patgilm

Those are some of the reasons I think I may lease my next daily driver. Is there a reason why you would only lease an entry level luxury car vs. a more high level luxury car?

grabber2

Higher end car have a bigger depreciation and result in higher monthly payment. For ex. one of my friend is paying $350/months for a $40K IS and one is paying $700/months for a $57K GS.

The price different is too much according to my standard. I'm good with number, so I will only goes for the best value and entry level luxury seem to have the best value.

huy33

You can probably lease a Honda Civic for less than $300/month. They have special offers on them for $199 + TTL so with no money down, it should be less than $300. I think for every $1000 you put down, it's $25ish less a month for 4 years.

And that's why, it's better to lease a daily but the Civic isn't very "fun".

Lil4X

If you are making a "buy or lease" decision, check first with your tax adviser. Tax breaks, particularly for a business lease vary from state to state and year to year. In some circumstances, a lease may be a considerably better deal at tax time.