Leasing numbers Rivian gave me (Need Help)

[_Snow_]

Hello, Im looking to lease an R1T and I could use some help to make sense of this. They provided me some info but not all of it and im having trouble making out why the residual value is so high.

Price: $75,500
Term: 36 months
Miles: 10k
Monthly Payment: $362.89


Due at signing:
First month payment
$362.89
Taxes*
$1,889.59
Acquisition fee
$895.00
Home delivery fee
$0.00
Documentation fee
$347.00
Title & registration fees
$145.00
Down payment
$15,000.00

Total due at signing
$18,639.48



Credits:
Deposit credit
-$1,000.00
EV lease credit
-$7,500.00


Residual value: $47,926/62%


My down payment and monthly payment equal:
($15k + $1k deposit + $12,701 monthly) = around $28,701
I understand there is interest in the payments

$28,701 + $47,926 = $76,627... Why is it so high? Should it be much less with the EV tax credit? My calculation would be $69,127 + interest paid on the lease.

EDIT:
+ $1,800 destination fee = $70,927 + interest paid on the lease.

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[MidnightRivian]

Does your price include the destination fee?

 

[_Snow_]

Destination fee is $1,800. Sorry i forgot to add that. Rivians breakdown on their site is terrible

 

[R1SFamilyGuy]

I am awaiting my lease contract as well (R1S) and haven't leased before but from what I've read here before...

1. you are paying rent for the truck plus for the depreciation
2. don't put so much down for a lease - why not consider a finance instead?

also, if you want to lease, ask for numbers without the downpayment and re-do the math. my guide tells me they should be generally able to do that.

Edit: the destination fee is added in upfront cost for leases and financed when you take a loan

 

[_Snow_]

I understand not to put so much down. I do plan on purchasing at the end. I understand gap. I may change the down if i can. Just trying to make sense of the high residual.

I also want to get the full EV credit

 

[jaygar562]

When you lease, you typically want a higher residual value. This will make your monthly payment less. The lower the value, the higher you’re paying monthly to “rent” the vehicle. Typically people do not buy out their vehicle at the end of a lease, therefore, many want to see a higher RV so the lease can be more attractive and a better deal.

 

[virgnia_rivian]

That residual seems normal for current interest rates and the typically higher rate associated with a lease. Leases are notorious for not being transparent in the rate.

That’s also a big down payment on a lease. Yes, it’s lowering your monthly payment, but the benefit of a lease is less cash out of pocket up front and the ability to walk away when the lease is over, typically paying 40-50% or the original sticker price.

 

[jjswan33]

I think you are doing your math wrong. Let me try to help:

Vehicle - 75500
TTL - 2092
Aqc Fee - 895
Dest Fee - 1800
Total = 80287
EV Credit - 7500
Down Payment + Dep - 16000
Capitilized Cost = 56787

The residual you quoted is 47926

Lease payments then become 8861/36 payments for depreciation + a rent fee/interest

Or $246/mo towards depreciation and $117/mo in rent fee with your $363 payment, a total rent fee (interest) of ~$4200.

I assume you are buying a 2024? I think the current promotions would bring the rent fee down $70/mo if you choose a 2023. You might also get a lower rent payment with a 2 year lease but will obviously have to pay more per month in depreciation.

 

[_Snow_]

I see the $4,200 (intrest + rent fee) is the difference I was missing. It seems high. I didn’t calculate it to be this high. They said they will give me a better breakdown within 72 hours of delivery. I wish they were more transparent

 

[kizamybute']

Low payment means high residual value. Can choose to make a larger payment and have a lower residual value if you want. They are trying to move trucks. So, they're gambling on themselves that the trucks will still have value upon lease end.

 

[jjswan33]

I see the $4,200 (intrest + rent fee) is the difference I was missing. It seems high. I didn’t calculate it to be this high. They said they will give me a better breakdown within 72 hours of delivery. I wish they were more transparent

If it makes you feel any better I leased a 2024 Ioniq 5 in December. 3 year 10k miles. ~$60k MSRP My rent charge was >$12k (hence why I paid it off already)

 

[Dave S]

The residual value is set by actuaries who are essentually gambling on what the car will be worth at the end of the lease after all your wear and tear. Wiht a 10k mile lease, your wear and tear is a lot lower than 12k or 15k, so your residual is higher.

The amount you put down on the lease has no effect on the residual value. The value is the value.

The amount you're putting down is essentually pre-paying your depreciation / rent fee. Pay it now, or pay it later. You'll be paying it by the end of the lease.

Ideally, a high residual is a good thing becuase that keeps your monthly rent cost down. A lower residual and you'll have higher payments (remember, your payment is based on the depreciation of the vehicle while you have it).

During Covid, I made out like a bandit with a Mazda CX5 I had that was coming off lease. The 'street price' for used SUVs was THOUSANDS of dollars higher than the residual the bank had calculated three years prior. I bought out the lease, traded the car into CARMAX, and at the end of the day, it net out to only costing me a few hundred dollars to drive that car for 3 years!

It could go the other way too. Your Rivian could be worth half of the residual when your lease is up. If that were to happen and you could buy one off the street for half the cost of buying the one you've been driving, you'd hand that back to Rivian in a heartbeat. Or you could look at the payments to purchase your 3 year old $50k Rivian, and just decide to hand it back to them and roll off the lot with a brand new one, keeping your payments low, like they are now.

 

[_Snow_]

Thank you everyone! Great info

 

[yetti96]

If you are putting so much down and understand the issue with total loss, ask if a one-pay is the same or if like many premium brands, they pro-rate the money in the event of a loss and you're just out the equivalent of the payments and get the rest back. I have always been a zero down guy for leases.

 

[FutureTruck]

Sorry to hop on this thread, but, can you talk to Rivian and run lease numbers without paying a $1,000 deposit? I’m interested in an R1S lease but when I went through the steps it asks for a $1,000 non-refundable deposit…and with the “taxes and fees” excluded I’d like to get some real numbers before pulling the trigger.

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