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What most people may not know is that a car dealer doesn't really lease you a vehicle at all. They work out a deal to sell the car to a third-party leasing agent who then leases the vehicle to you.
Never a good idea unless you are the leasing company.
Leasing is great if you plan never to drive the car. They nickel dime you on every nick, scrap and bug tar. And don’t even think of putting any mileage on it.
I was shopping for a car last year, and when I worked the numbers, leasing then buying the car was considerably cheaper than buying and financing. But it was a “manufacturer’s special” online deal that the dealer was obviously not particularly interested in promoting (when I demanded to see the car from the online ad versus what they wanted to show me on the lot, they brought it out with bird crap on it!).
The fact is that most writers for TheStreet.com have little idea how leasing really works, too.
Some cars, like the Bugatti Veyron, actually increase in value 2-3 years after they were sold as new.
All I have to do now is to convince the local Bugatti dealer to lease me a Chiron, and not only will I get to drive the car for three years, the lease should pay me!
Re: Leasing is better for businesses than individuals unless the individual wants a new vehicle every 3 years, yada, yada, yada
Says who?
Dumb statement. Owning assets that decline in value sucks regardless of it’s a business (or personal). This is the key reason for leasing. Let the leasing company eat the loss.
Leasing isn’t just for cars. Until taxes are cut way more than current levels (or losses become more deductible), leasing will make a lot of sense if you anticipate that your equipment or autos/trucks will fall in value.
I did not invent this. It’s business 101
I read through the first paragraphs you posted and learned nothing. That’s not your fault. So many articles take forever to say what their headline promises us.
Our 2002 Toyota Sienna paid off in 1 year now has 130k miles and has had no issues other than normal maintenance and a couple repaired fender benders. Maintenance has been done religiously. She is showing her age though. I expect she’ll stand up to another 10 years and get to 200k before the body starts to fall apart around the engine.
Our 2012 Prius has been the road warrior now at 160k miles - regular maintenance, ice related fender bender and no other issues. I get the feeling she is going to last a lot longer than 200k. I have noticed the mileage has dropped from 50mpg on average to 45mpg on average. I assume this is due to mechanical wear resulting in a loss of efficiency. Bought it cash off the lot after getting the local two Toyota dealers in a bidding war.
The only other car that was a real trooper for me was a 1982 Mazda RX-7. After 200k miles I sold it to my sister for $1 so she had something to drive to school. That little rotary engine only caused one problem for me when an air valve broke stranding me in FL while on leave...had to scrounge up the money to fix it to get back in time.
Everything else I’ve owned - an old GM monster (Forget the model), a Ford Taurus, and a 92 Nissan Pathfinder all had major issues - though the pathfinder did give me 50k miles (bought it at 150k) as long as I put the $s in to fix the ongoing issues.
I sold the Nissan for $1000 to a work mate for his kid. He was driving it to get emissions checked and the engine threw a rod. He figured the new tires alone would get his money back and was just happy his kid wasn’t driving - else he’d of accused him of raving the engine.
Bkmk