Finance vs. Lease the R2 -- the math

[ribuck97]

Yeah, they’re definitely incentivizing buying over leasing at this point. Demand is high, which is great for the company. I’m going to wait until next Spring when the majority of trims are released and some of the bugs have been worked out. Leasing a Standard or even a Premium model should be much more reasonable ($500-$600 a month?)

Keep in mind, all I'm doing is GUESSING at the monthly and calculating the APR. If Rivian uses the Performance APR, the monthlies will be much higher.

People need to understand that a portion of the high lease APR is, in my opinion, due to the "free" launch package value of $3700

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[Rizzian]

@ribuck97 , there's no such thing as a free launch

 

[Gen(R3)Xer]

Keep in mind, all I'm doing is GUESSING at the monthly and calculating the APR. If Rivian uses the Performance APR, the monthlies will be much higher.

People need to understand that a portion of the high lease APR is, in my opinion, due to the "free" launch package value of $3700

I figured it was just a guess, but thanks for the effort. Buying might actually be better after the RAP1 + LiDar upgrades roll out. Depends on a lot of factors that could change within a year. I’d love to see the competition heat up in this space and some great deals come out of it.

That Launch Package is beefy.

 

[emroch]

If I am reading this right, in Texas you will pay sales tax on the full value of the car - up front - if you lease. Then if you buy it at the end of the lease, you will pay sales tax yet again on whatever the residual amount is. Double tax for a least a portion of the cost. Texas auto sales tax is 6.25%.

This is correct. Leasing with the intent to buy out is tough in Texas because of this tax situation. You'd need a good incentive that covers the double taxed portion and then some for it to be better than financing.

 

[RivAW]

Financing vs. Lease math - by @travisketchum

If you're weighing lease vs finance for the R2, the numbers tell you everything you need to know.

Financing can save you $8,836 over a 36 month term.

Until you get to the end of 36 mos and shop trade in offers the “estimated equity” on the finance side is just made up (barely better than a guess), which heavily tilts the “analysis” one way.

 

[Kidentist]

JESUS !!! my current lease is $238..........why would I ever pay more. NEVER. Once it's over time to move on, it's been fun though.

 

[RivAW]

R1 is a bad example to use IMO. The higher the cost of the car the more there is to depreciate. $100k cars have a lot of room to go down in value. An R2 is only $50-$60k...can only drop so much.

Also with EV depreciation historical trends you must take out COVID pricing in the 2022-2023 time frame to get realistic future depreciation. The media loves writing articles about how badly EV's depreciate but ignored the crazy market factors at that time that applied to all cars really. People were paying $70k+ for new Model Y's at that time. RAV4's at the Toyota dealership near me were going for $50k! A foreseeable massive drop in value once the COVID spike ended.

Depreciation is typically a percentage rather than a specific dollar figure. R1s having more room to drop in value seems like a silly argument

 

[Jeremy3292]

Depreciation is typically a percentage rather than a specific dollar figure. R1s having more room to drop in value seems like a silly argument

I’ll let you do the math: what’s 50% of $100k vs 50% of $50k? Math is hard, but seems to me one of those is a “much larger drop” in value.

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