If leasing is not available, would you cancel your Gravity order?

If leasing is not available, would you cancel your Gravity order?

  • Yes

    Votes: 32 65.3%
  • No

    Votes: 17 34.7%

  • Total voters
    49
Hopefully others will weigh in with their thoughts. I'm new to this leasing stuff.

You could pay out that cash in two phases over time in two ways instead of all at once. Choices:

1. Lease to get $7.5k credit off MSRP. Ask for lease buyout option and pay off lease right away with cash. @borski isn't this what you did with your Ioniq 5?

2. Lease to get $7.5k credit, pay lease over however many years you decide, look at residual value, and decide to either pay residual with cash or find a used Gravity (if lower priced than residual on your lease) and pay cash. One challenge is finding the exact used Gravity with the features you want and decent mileage. Exploring a lease option can't hurt. Get details and then decide.

Of course paying cash upfront saves you more on interest costs during a lease than the $7.5k credit unless immediate lease payoff.

If you definitely know you want to keep your Gravity, consider a slush fund for future battery replacement. Who knows, by time one is needed the price should be quite a bit lower. By time the warranty expires there should be new battery tech.
A lease does give you the most optionality. I calculated I could cancel out half the depreciation over 2-3 years by keeping the remaining cash that would have gone for an upfront purchase in the market with a conservative return and investment....
 
A lease does give you the most optionality. I calculated I could cancel out half the depreciation over 2-3 years by keeping the remaining cash that would have gone for an upfront purchase in the market with a conservative return and investment....
This leasing stuff can get complicated in some ways, depending on a buyer's situation and intent.
I get the simplicity of paying cash if you know you want a car and don't want to deal with the market, financing, and willing to take the risk of ownership from a new carmaker.

If you know you want a car and have the cash, seeking a single pay lease upfront sounds like the best move especially if the tax credit lowers the price.

In my situation of leasing and paying rv in cash, it works for me.
The issue of ppf came to mind.
I think I'm going to do the ppf because I want to buy.

Looking for a used Gravity with decent mileage, no issues, updated software, etc. could be like finding that needle in a haystack.
I've also read the stories of a used Air having software update issues.
There's also the possiblity of issues the previous owner didn't know about.
Typical use car issues with any car (ev or ICE).
 
I prefer to lease so that I can avoid the big ht on sales tax here in California. I also like to know where I stand at the end since you don't know where the final value is. Yes, if value exceeds the cashout, then you can buy and make money. I am not sure where it will stand with a new vehicle that has yet to hit the road. I think I will love the car but need to see it in person before I make a final decision and I need to see the fiscal parameters of the lease program.
 
I live 1.5 hours from Charlotte and 2 hours from Atlanta. This helps me to stop thinking about service locations and likely eliminate the Volvo EX-90 from consideration. Thanks much for the info @msaunders9430 !
 
I never used to lease. But I leased my last two vehicles - the first one being my Lexus RXL. The second one is my Air Pure. When it was time to return my Lexus, the market value for that vehicle was a lot more than my lease buyout cost. I could have bought, turned around, sold it at the local CarMax, and walked away with about $8k. My calculus for leasing air was to avail myself of the tax of $7.5k and have a choice at the end of the lease to return it or keep it, depending on the market at that time. Who knows how EV tech will evolve by then, and who knows what Lucid's status is? So, leasing de-risks my decision and gives me another shot at the end of the lease to keep it or return it, based on the ground realities at that time. Considering the rapidly evolving EV space and the depreciation, I wanted to defer my purchase decision to 36 months. I don’t argue this approach is right or wrong. I'm just sharing how I think about it.
 
No company's existence is ever guaranteed.
Maybe this is the hubris of the young… but with how much PIF and other growth investors have bought in I think it’s safe to say the runway for the company is long.

Fisker, (which I don’t even want to bring up because it has almost nothing to do with the viability of a company like Lucid) was doomed due to mismanagement and federal loan revocation. I think the fact that you have large brands looking to partner with Lucid ( and depend on them for drive train/bat management tech) means that the internal analyst for those large corporations have done a lot of due diligence and agree that Lucid isn’t going anywhere.

I feel that I wouldn’t take into account Lucid going bankrupt or defaulting in a way that would limit the availability of service for the car. It would certainly hurt depreciation wise, but not to the extent that I think the original poster is thinking.

Also never put any money down on a lease if you can help it just my two cents.
 
Maybe this is the hubris of the young… but with how much PIF and other growth investors have bought in I think it’s safe to say the runway for the company is long.
Of course, but my point is that anything can happen. I've seen it lots of times before. All it takes is a series of poor decisions.

I'm long on Lucid and don't think they're going anywhere; I'm a (small) shareholder and soon to be the owner of two DEs, lol, so you don't need to convince me.

I agree with you that the future of Lucid looks extremely promising and that, as usual, their imminent failure has been greatly overstated, for the four-hundred-eighty-ninth time. :)
 
Also never put any money down on a lease if you can help it just my two cents.
I agree.

I'm reading everywhere that residual value is the difference between the the vehicle price and the depreciation paid during the lease term with monthly payments.
Correct me if I'm wrong on this, but it looks like a down payment skews or misrepresents that actual depreciation paid during the lease term with monthly payments.

Example:
Vehicle price: $100K
Lease term: 36 months
Residual Value: $60k
Monthly payments w/o downpayment: $1,400
Monthly payments w/downpayment: $1,100

Without a downpayment: $50,400 ($1,400 * 36) paid during lease term (50% depreciation)
Residual value of $60k + $50,400 = $110,400 (110.4% of vehicle price)

With a downpayment: $39,600 ($1,100 * 36) paid during lease term (39.6% depreciation)
Residual value of $60k + $39,600 = $99,600 (99.6% of vehicle price)

A downpayment is basically prepaying some of the depreciation?
In the example above the downpaymen required for the stated monthly payment calculates to $10,800 ($300/mth over 36 mths.)

A downpayment needs to be added to the total of monthly payments to determine actual depreciation paid by leasee?
In the example above $10,800 + $39,600 = $50,400

So, is the true depreciation 50% or 39.6%?
 
I agree.

I'm reading everywhere that residual value is the difference between the the vehicle price and the depreciation paid during the lease term with monthly payments.
Correct me if I'm wrong on this, but it looks like a down payment skews or misrepresents that actual depreciation paid during the lease term with monthly payments.

Example:
Vehicle price: $100K
Lease term: 36 months
Residual Value: $60k
Monthly payments w/o downpayment: $1,400
Monthly payments w/downpayment: $1,100

Without a downpayment: $50,400 ($1,400 * 36) paid during lease term (50% depreciation)
Residual value of $60k + $50,400 = $110,400 (110.4% of vehicle price)

With a downpayment: $39,600 ($1,100 * 36) paid during lease term (39.6% depreciation)
Residual value of $60k + $39,600 = $99,600 (99.6% of vehicle price)

A downpayment is basically prepaying some of the depreciation?
In the example above the downpaymen required for the stated monthly payment calculates to $10,800 ($300/mth over 36 mths.)

A downpayment needs to be added to the total of monthly payments to determine actual depreciation paid by leasee?
In the example above $10,800 + $39,600 = $50,400

So, is the true depreciation 50% or 39.6%?
I'm guessing true depreciation is 50% that can be paid in two ways:
1. $10,800 in advance with remaining $39,600 paid during lease.
2. $50,400 all paid during lease
 
no offense, but you don't understand leasing. down payment has no impact on residual. it does impact the capitalized cost, which impacts the amount of principle exposed to interest/money factor, and thus the payment and the total interest cost over the life of the lease. how leases work is easily google-able.
 
When I leased a BMW X3 years ago, I faced one unexpected challenge. I decided I wanted to buy it out at the end of the lease and was ok with the residual value specified in the lease terms. Even though I was buying the car I had been driving for 3 years, BMW needed me to drive to a service center for an inspection. There they found a number of minor issues that I needed to address first "to assure my car would be safe to sell". I was incredulous, since I was already driving the same supposedly unsafe car, and just wanted to buy it at the agreed value. That was the fourth BMW I owned (the first that was leased), and I said if they didn't waive the BS charges and just let me buy the car, they would lose a good customer for life. They didn't budge. I paid the repair charges, turned in the lease and won't ever buy another BMW.

My AT is only the second car I've leased - the incentives were too good to turn down. I hope the Lucid lease turn-in process is more friendly than BMW's.
 
no offense, but you don't understand leasing. down payment has no impact on residual. it does impact the capitalized cost, which impacts the amount of principle exposed to interest/money factor, and thus the payment and the total interest cost over the life of the lease. how leases work is easily google-able.
No offense taken.
I have clearly stated in several posts that I'm still learning this stuff.

Easily google-able? Absolutely.
Been doing that, which is why in post #70 I said "I've been reading...".

I'm not thinking down payment affects residual value. I'm thinking it affects the amount paid over the lease, which seems to be what you're saying.

I wouldn't be posting here if I hadn't googled this topic. Seeking clarification.
 
I'm kinda like you.
I keep cars a long time as well.
I'll most likely buy if leasing isn't available.
The only thing that would change that is if a car as good as Gravity is available and the financials are good or better than with Lucid.

I've never leased before because I've never seen a leasing scenario that was better than buying considering my long term ownership stance. I've also never planned well in advance for a car purchase like I've been doing since 2023. Deciding on an ev and having the time to research and plan is contrary to my past purchasing.

The $7.5k tax credit is a big factor. And yet, even w/o it I'll probably still buy. I'm in a position to pay for car depreciation during a lease (dependent on the money factor) and then buyout the lease (depending on the residual value) in cash. Based on my calculations, with the help of the tax credit, I will save around $10k overall.

I hate car payments. No shade on those who perpetually lease for a new car more frequently. Just not my style. With a 36 month lease I will shorten my normal 60 month financing and related payments by 24 months and come out ahead financially. All this depends on what Lucid announces as lease/buy options with Gravity.

Do what works for you.
It's your money.
Same. Of course everyone's situation will be different. I bought my current car (2022 Model X Plaid) outright, and plan to do the same for my Gravity DE. I understand I'm losing money, but I'm pretty well invested elsewhere and am starting to view my car purchases as more of an investment in my soul and in my time, both of which have value. I leased my two prior cars (2016 BMW 750i, and a 2019 Tesla Model X P100D), but I really love driving. I have a 90-mile round-trip commute to work every day, and frequently drive between San Francisco and Southern California (have properties at both ends). Throughout the terms of both leases, I really hated the mileage cap dangling over my head like the sword of Damocles 🤣 Sure, I paid the (significant) overage when I returned the leased vehicles, but I just hated thinking I was restricted in any way while I drove those cars. I pile miles on my cars and usually trade when I hit 100K. This year is an exception, because I want to get out of my X Plaid -- and Tesla in general. I'm sitting at ~67K miles on this car, and plan to sell it as soon as my Gravity DE arrives for whatever price someone's willing to pay for it, understanding I'll probably hit ~75-80K miles by the time my delivery slot is available for the Gravity.
 
I think your issue is that you keep trying to define the word “depreciation,” which has a couple of different potential meanings.

One is what I’ll call “market depreciation,” which id define as “what is the car worth on the open market at the end of the lease?” That’s unknown and somewhat variable. We don’t know what a x-month year old Gravity with y options and z mileage is going to be worth at some point in the future.

The other is what I’ll call “lease depreciation” but note that this is not a term specifically called out in any lease. A lease will call out a residual %age (maybe, but you can calculate it) and/or and a residual value (calculated as residual %age x MSRP). The leasing company sets the residual %age and more importantly, the residual value, as a fixed input into the lease calculations. They determine the residual. You can’t negotiate it. The “lease depreciation” could therefore be defined as MSRP - residual value, and if you wanted to you could express it as a %age, which would be 100-residual %. But if the cars price is negotiated to lower than MSRP, maybe you could argue that the lease depreciation is less. And then you have to throw in the EV credit, which may or may not apply, and decide how you want to figure that into the “lease depreciation.”

But “depreciation” is not something that really has a specific meaning in this case. I think you’re trying to back into a number by adding up lease payments, but that doesn’t really make sense. Lease payments are an output that spits out of a calculation based on the inputs of residual value, interest rate/money factor, and total capitalized cost. Depreciation is neither a specific input nor output.
 
no offense, but you don't understand leasing. down payment has no impact on residual. it does impact the capitalized cost, which impacts the amount of principle exposed to interest/money factor, and thus the payment and the total interest cost over the life of the lease. how leases work is easily google-able.
Post in thread 'Best Damn Car AND Best Damn Car Buying Experience. Ever.'
https://lucidowners.com/threads/bes...-car-buying-experience-ever.10826/post-240197
 
Of course, but my point is that anything can happen. I've seen it lots of times before. All it takes is a series of poor decisions.

I'm long on Lucid and don't think they're going anywhere; I'm a (small) shareholder and soon to be the owner of two DEs, lol, so you don't need to convince me.

I agree with you that the future of Lucid looks extremely promising and that, as usual, their imminent failure has been greatly overstated, for the four-hundred-eighty-ninth time. :)
At least it hasn’t been stated more than 520 times…. Then we’d be bumping up against the laws of ‘Lucid’ Physics… integer overflow…
 
am starting to view my car purchases as more of an investment in my soul and in my time, both of which have value.
You hit it right there.
Invest in your soul and value your time.
That topic alone could be a seperate thread alone. :)

Sounds like you're financially stable and knowledgegable on your decision.
Enjoy your assets because you can't take them with you when your time is up on the globe.

Short story:
I had a middle sister who often complained about how much her grown children paid for stuff.
Her son, bought a Tesla years ago. He asked me to never mention it to his mom because he knew she would complain to him.

My sister was quite frugal.
She passed away at age 75 with an estate valued at several million.
Her grown children are now spending the money she left behind.
I asked her son if he ever told her about the Tesla. With a smile he said "nope" and then told me about the BMWs he and his wife had each just purchased.

Do what works for you.
 
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