Buy a 2014 or Lease a 2015?

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jpa2825

Active member
Joined
Nov 16, 2015
Messages
30
Location
NKy. Near the 'nati
Assuming I could buy a basic 2014 REX with a partially used warranty (3 yrs. instead of 4 b/c placed in service by dealer) but fully eligible for the $7,500 fed tax rebate for $33k + tax, title and all non-dealer charges (net $25.5k after fed tax rebate), is that a smarter move than leasing a 2015 for 30 mos., 12k miles for ~$250/mo.?
 
I bought mine a year ago. I had never leased a car, ever, and was not well versed in spotting a good lease deal at the time. So I bought my i3

In hindsight, after a year of ownership, I believe these cars should only be leased. They are like smartphones were early on. The technology is going to dramatically change in the next 2-3 years. Best turn them in every 2 years while they're on such a steep learning ramp.
 
Sparky said:
In hindsight, after a year of ownership, I believe these cars should only be leased. They are like smartphones were early on. The technology is going to dramatically change in the next 2-3 years. Best turn them in every 2 years while they're on such a steep learning ramp.
On the other hand, if one is satisfied with one's smart phone or i3, why replace it every 2 years? Doing so is generally more expensive than keeping it. If some new capability is just too much to ignore, then spend the money.

Apple gave me the original iPhone as an employee. It did what I needed for years despite rapid improvement in subsequent versions. I finally replaced it with an iPhone 5s which I will likely keep until it is no longer compatible with the current iOS version which I suspect will be at least 5 years.

We purchased our i3 BEV for the same reason. It does what we need and should do so for many years. Increased range would not be the new feature that would persuade us to get rid of our current i3. I don't understand leases well enough to recognize a good lease, but I do know that I'd rather not have a monthly lease payment essentially forever. I'm gambling that our i3 will be reliable enough not to cause us to get rid of it sooner than we would prefer. But if we decide to get rid of it early because repairs are costing too much, leasing would have been better than purchasing.

The lease vs. purchase decision is definitely a personal decision based on one's situation, but the correct decision isn't always to lease.
 
Lease. 100%.

The leases are so heavily subsidized right now that you are paying a very small fraction of the vehicles' price to drive it for 2 to 3 years.

Feel free to buy the car at the end of the lease if you want, but you won't want to. The residuals on i3s, even with the new lower residuals, are still far in excess of what you will be able to buy one for in a few years. The artificially high residuals, combined with distributing the incentives over a short period of time, make leasing a no-brainer choice right now on i3s.
 
All of that becomes somewhat mute if you decide to keep the car for a long time. Unlike an ICE, there is very little to wear out and require maintenance, and with the CFRP, plastic, and aluminum, nothing to rust out and fail. sure, some love a new one, and having the factory warranty has benefits, but at a pretty steep cost if you're satisfied with the thing after the warranty runs out and intend to keep it a lot longer.
 
Interesting that so many favor a lease in this specific scenario. I think at 33k it is obvious that you should buy. I realize that these don't hold their value but they will hold some value (esp rex versions) and if the car works for your situation there is no reason not to buy if you are getting it at that price. I bought my CNG powered civic for 17k new back in 2008 and was able to make money (sold it for 26k after putting 45000 miles on it) because gas went up in price (and I was moving to an area without CNG infrastructure).

Not saying this is guaranteed to happen again but your $33k 2014 will be worth at least $10k (and probably a lot more)in 3-4 years, just based on finish /bmw brand. The 8 year 100000 mile battery warranty is an underrated aspect of the i3 in this regard. I say buy and don't look back. Curious what trim you are getting and how many miles are on your 2014.
 
250x 30 is 7500 net your car will depreciate more than 7500 in 3 years when the average bev is 200 mile range. A used 2014 with 5000 miles on it is selling for 27k at the dealer today. You will not get 17k for your car in 30 months. Make bmw fs take the financial risk. There is just no point owning at this point in bev development.
 
jhu321 said:
250x 30 is 7500 net your car will depreciate more than 7500 in 3 years when the average bev is 200 mile range. A used 2014 with 5000 miles on it is selling for 27k at the dealer today. You will not get 17k for your car in 30 months. Make bmw fs take the financial risk. There is just no point owning at this point in bev development.
But if one is satisfied with her i3 and doesn't need the additional range that some future model will have, why replace it in 3 years, or whenever? For those of us in that situation, especially if we don't want to make monthly payments, there's good reason to buy and not lease.
 
alohart said:
For those of us in that situation, especially if we don't want to make monthly payments, there's good reason to buy and not lease.

There really isn't.

The numbers are totally on the side of leasing then making the decision to buy or not in the future.

At the end of the lease if you still want to own a 2014/15 i3, go right ahead and buy one on the open market for a price $10,000 to $15,000 below the residual. Exploiting the wildly mispriced option built into the residual gives you a far lower cost of transportation now and a chance to bail when the car doesn't hold its value.

Don't like payments? Do a single-pay lease and cover all the payments up front. You're still better off not owning something that will depreciate to a price far below the artificially inflated residuals that BMWFS is offering on i3s. Cars are fungible, go ahead and buy a replacement after the lease. Heck, BMWFS may even make a deal with you (through a dealer) to sell you your own i3 at a price far below the residual.

I'll end with "agree to disagree" to save you having to post it after my post.
 
Leasi3 said:
alohart said:
For those of us in that situation, especially if we don't want to make monthly payments, there's good reason to buy and not lease.

There really isn't.
Sure there is. I bought a new Porsche 914-6 in 1971 and sold it in 1989. I bought a used VW bus in 1980 and sold it in 1997. Our other current car is a Honda Insight that we've owned for 13 years despite much more capable hybrids being available since. So we tend to keep cars for much longer than average. Depreciation has little importance to us because of this.

Our Insight depreciated rapidly when it was new, but that is a pure paper loss until one sells. By now, our Insight isn't depreciating noticeably, and it remains reliable, so we have no reason to sell it. Had we leased it and turned it in after the lease because the residual was much higher than its used car value, we would have had a very difficult time finding a replacement in as good a condition as ours. I'm guessing that the same will be true for our i3 because we live in a relatively small, very isolated market, Honolulu. There will likely not be as many used i3's available here as in most markets. Buying one in a neighboring state and shipping it here would be expensive and a PITA. Frankly, I'd rather keep a car whose past I know rather than buying a used one whose past I don't know. That has value to me.

If a car performs well, I don't sell it just because there's something out there that might be "better". So if our i3 continues performing well and satisfying our needs, we won't sell it for many years.

Leasi3 said:
The numbers are totally on the side of leasing then making the decision to buy or not in the future.

At the end of the lease if you still want to own a 2014/15 i3, go right ahead and buy one on the open market for a price $10,000 to $15,000 below the residual. Exploiting the wildly misplaced option built into the residual gives you a far lower cost of transportation now and a chance to bail when the car doesn't hold its value.

For some of us, pure numbers aren't the only consideration. If I was purely driven by numbers, I wouldn't buy or lease a BMW but would stick with much less expensive Japanese cars whose reliability and total cost of ownership are much less. But when I believe in supporting a new technology in hopes of helping to make it popular, I don't mind paying the price even though the numbers might not make sense to those for whom the numbers are paramount. In the case of the i3 and the Insight, I am supporting the light-weighting of cars and the reduction in the dependence on ICE's via novel drivetrain technologies.

Leasi3 said:
Don't like payments? Do a single-pay lease and cover all the payments up front. You're still better off not owning something that will depreciate to a price far below the artificially inflated residuals that BMWFS is offering on i3s. Cars are fungible, go ahead and buy a replacement after the lease.
Apparently, cars aren't as fungible to me as to you.

Also, I want to own our car. I don't want to ask for permission to make modifications or worry about whether I'll have to reverse the modifications or pay a penalty when I turn in the car at the end of the lease. I don't want to have to repair minor cosmetic damage for fear that I will be charged exorbitantly for it when I return the car. We don't drive much, so I don't want to be insulted by the paltry credit usually given for miles not driven at the end of the lease. I just want to be as free of BMW and its leasing company as possible.

So, for some of us, there are compelling reasons for buying versus leasing.
 
Good points to both sides here. Art makes some great points on cars that are kept a LONG time.
 
Other factors to consider (in favor of buying at the great price the orig poster has available ):

Future i3s may have great new features or range options but you are likely to pay for those. If gas goes up in price (probably won't for awhile but you never know) i3s will too.

For those who think they might use it for awhile, especially those going "all in" like I am (home charger, accessories for the car, solar panels at your home) it then comes down the srandard lease vs buy arguments that have good points for both points of view.
 
Leasi3 said:
Heck, BMWFS may even make a deal with you (through a dealer) to sell you your own i3 at a price far below the residual.
^^^ With the new Volt and Le@f in 2016, and the greater range of the 2017 i3, I would bank on this.

Next spring/summer, when i3 early adopters come off their 2-year leases, should be very interesting to follow. Competition is a beautiful thing.
 
As has been said, if you plan to keep the car a long time and you don't need additional range, you'd tend to keep the car until depreciation is mostly irrelevant, which is what I plan to do with mine. I tend to keep my cars a long time unless they piss me off for one reason or another, and, so far, I have no grinding issues with my i3. Your results might differ.
 
Just an update to the OP. I drove the 2014 yesterday. In addition to partial warranty erosion (in service of 10.28.14), the car has been used as a Courtesy Vehicle (still has the lettering on it) and has 4k miles. As such, my new ceiling is probably closer to $30k.

From another thread, I will try to compare purchasing the 2014 for $30k against the RobJones reported deal.

BUY 2014 bare bones - $30k + taxes, title, etc. (assume $5k since it was $3,617 in RobJones example for apples to apples comparison) less $7,500 tax credit = $27,500 net
LEASE 2015 w/ good options - $5,137.94 cash due + 23 payments of $222.06 = $10,245.32 outlay after 2 yrs.

Is it too simple to say that if I could sell the 2014 in DEC 2016 for about $17k the 2 would be a wash (other than trim issues)? If I think I can sell it for $20k, buy is the better choice. If I think I could only get $14k for it, lease is the better choice.

Given that I am now exiting the 39 mo. Leaf lease, I understand the dilemmas created at Lease end. My residual was $16.8k and Nissan knocked $5k off of that. $11.8k was too high for me. If I had bought the Leaf, I'd probably just keep driving it. The Lease is forcing me into a decision. Maybe that is good. Maybe that is bad. The above discussion seems to break on whether you want to keep the car longer OR want the opportunity to do so. I do like flexibility and being stuck in a lease and being forced to take action on a specific timeline is less comfortable for me. If I had other options, I might wait on the early adopter i3s to start rolling off their 24 mo. leases and try to get a cheap one used there.

So many thoughts. Thanks for helping me work through them.
 
No one has mentioned that if you keep the car a long time it will be out of warranty most of that time. Personally, I'm not interested in taking on the risk of high cost repairs of a car made of such exotic materials as this one should it have an issue. And this is not exactly known to be a trouble-free car.
 
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