floamis wrote:I'm pretty sure the urge to get the latest and greatest (whether it's Bolt 2.0, Model 3, or Leaf 2.0) for me will be overwhelming in 3 years time. That has certainly been the case with other sorts of tech for me! I will gladly pay the premium on a lease to satisfy that urge (as well as the curent urge for the Bolt) down the line.
You can satisfy that urge with a purchase as well, by selling the car in 3 years. The economics of the lease versus buy question then becomes a question of forecasting the value of the car in 3 years, arguably a difficult forecast.
For a detailed example, take a loaded LT with an MSRP $39,790, a sales price of $1,000 off MSRP, 9% sales tax, $400 in license fees, and an $80 doc fee. The out the door cost to purchase is $42,761. If you lease for 36 months at 0.00072 money factor, $2,500 in CCR from GM, a 60% residual, and a $2,500 driveoff payment, your monthly payment including tax will be $402/month. If you get $2,500 from the California rebate program, your total lease cost is $14,465 (that's 35 * $402 plus $395 disposition fee).
If instead you finance the car at, say, 3% on a 5 year loan, again with $2,500 driveoff reimbursed by the $2,500 California rebate, that's a $737/month payment, assuming no loan fees. After 35 payments of $737, your remaining loan balance will be $17,140. If you pay off the loan at that point, your total cost for the car will be $35,435 (that's 35 * $737 + $17,140 - $7,500 federal tax credit).
So in this example, if the 3 year old Bolt can be sold for at least $21,000 in 2020, you'll be better off buying than leasing. If the 3 year old Bolt is worth less than $21,000, you'll be better off leasing. This assumes the cash flow works for you either way, ignores the differential time value of the two cash flow schedules, and includes some rounding at a couple steps.
Note that the lease in this example has a residual of $23,874 and a capitalized value of $35,614, so the total lease fees and interest are $2,532. While the loan interest is $2,674. That is, while the lease has an effective interest rate of 1.73%, it has $990 in acquisition/disposition fees, so the total cost is close to the 3% interest on the loan. If the loan rate were lower, the breakeven 2020 market value would be lower. For example, at 0% loan APR, it would be $18,300 (that's $32,761 net cash purchase cost - $14,465 lease cost).