Leasing and residuals...
02-24-2003, 11:30 PM
#1
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Leasing and residuals...
Being that I will be leasing my car I realize that closing the gap between initial value and residual would be beneficial. I realize that there are certain options which will increase the residual value to the point of lowering the monthly payment - the opposite is also true. My dealer (who is a close family friend) said that although a tiptronic turbo is intially more costly than a 6 sp, the residual is higher on the 6 speed so the difference between intial cost and residual value is greater on a tiptronic car leading to much higher monthly payments.
The options I'm looking into right now are:
heated seats
lumbar - drivers & passengers
PCM II
Supple Leather
The only other option I would consider is the natural brown leather interior - although I'm still unsure of how it would look with lapis blue.
Has anyone looked into what configuration in terms of options would leave the smallest gap between intial and residual value?
The options I'm looking into right now are:
heated seats
lumbar - drivers & passengers
PCM II
Supple Leather
The only other option I would consider is the natural brown leather interior - although I'm still unsure of how it would look with lapis blue.
Has anyone looked into what configuration in terms of options would leave the smallest gap between intial and residual value?
02-24-2003, 11:34 PM
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No options and 6 speed will yeild least expensive lease. Automotive Lease guide will not allow for residualizing options.
Check out <a href="http://www.leasecompare.com" target="_blank">www.leasecompare.com</a>
Check out <a href="http://www.leasecompare.com" target="_blank">www.leasecompare.com</a>
02-25-2003, 08:56 AM
#3
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Perhaps I should reconsider the PCM II system if I'm going to lease. Opinions?
02-25-2003, 10:22 AM
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I think the Lapis blue with natural brown is beautiful. I have seen that combo before and I like it.
I think PCM is a waste of money...Although PCM II is light years ahead of PCM I
Good Luck.
I think PCM is a waste of money...Although PCM II is light years ahead of PCM I
Good Luck.
02-25-2003, 11:40 AM
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</font><blockquote><font size="1" face="Verdana,Tahoma,Arial,Helvetica,Geneva">quote:</font><hr /><font size="2" face="Verdana,Tahoma,Arial,Helvetica,Geneva"> I realize that there are certain options which will increase the residual value to the point of lowering the monthly payment - the opposite is also true. </font><hr /></blockquote><font size="2" face="Verdana,Tahoma,Arial,Helvetica,Geneva">No options will lower the monthly payment. Last time I checked Porsche Financial assigned the same percentage residual value to options as to the base vehicle, so the more you put in options the higher the MSRP, the higher your residual, and the higher your payments. The only way to lower your payment is to get a big discount which should not be hard to do right now.
Because you can residualize the PCM II it will be probably cost you less on a lease than a purchase, where you will be lucky to get much back on resale for such an expensive option.
Because you can residualize the PCM II it will be probably cost you less on a lease than a purchase, where you will be lucky to get much back on resale for such an expensive option.
02-25-2003, 03:12 PM
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Yeah, what Sawmilldriver said!
Plus;
4 numbers matter, 3 are negotiable
1)Money factor: Negotiable, the lower the residual, the lower the MF but work it to your advantage. Multiply by 2400 to get an APR like number
2)Residual (if you are planning on buying it at the end, go low, if you are turning it in go high)
3)Sell price of car (this is what the dealer will get paid for the car from the leasing company, so it is the most important number to the dealer) If they sell you a fat lease, they might also get a commission on it, but not always)
4) Sticker
These 4 numbers go into the magic calculator, and out comes your payment. Negotiate all three numbers individually (Low MF, High Resid, Low sell price) and you will do better on a monthly basis.
For example:
My TT "started" at $1851/mo, when I walked out a few hours later its was (and is) $1307.00 and everyone was happy.
Plus;
4 numbers matter, 3 are negotiable
1)Money factor: Negotiable, the lower the residual, the lower the MF but work it to your advantage. Multiply by 2400 to get an APR like number
2)Residual (if you are planning on buying it at the end, go low, if you are turning it in go high)
3)Sell price of car (this is what the dealer will get paid for the car from the leasing company, so it is the most important number to the dealer) If they sell you a fat lease, they might also get a commission on it, but not always)
4) Sticker
These 4 numbers go into the magic calculator, and out comes your payment. Negotiate all three numbers individually (Low MF, High Resid, Low sell price) and you will do better on a monthly basis.
For example:
My TT "started" at $1851/mo, when I walked out a few hours later its was (and is) $1307.00 and everyone was happy.
02-26-2003, 07:36 AM
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Mike, what was your total out of pocket expense when signing for your lease at that monthly payment?
One more question - would the x50 package be a worthwhile option on a lease?
One more question - would the x50 package be a worthwhile option on a lease?
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02-26-2003, 08:20 AM
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Don't have the docs in front of me but these were the numbers as I rememebr 'em.
Put $8K down (tax, dep, 1'st payment)which took about $200/mo off the $1851. 39 month lease. 67% residual. 6%. $124 Sticker, Paid $111 (+- $1K). Wishing now I went lower residual.
Anyone else on the X50? I can barely use the power I have, wouldn't know what to do with more. First Autocross in March, maybe I'll know then.
Put $8K down (tax, dep, 1'st payment)which took about $200/mo off the $1851. 39 month lease. 67% residual. 6%. $124 Sticker, Paid $111 (+- $1K). Wishing now I went lower residual.
Anyone else on the X50? I can barely use the power I have, wouldn't know what to do with more. First Autocross in March, maybe I'll know then.
02-26-2003, 08:29 AM
#9
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For those looking to save a bit, the market is SO soft on the 2001 and 02 turbos right now, and the leasing companies have not cought up to the reality of the depressed values.
My 01 Turbo had a sales price of ony $83,400, but the "Fair Market Value" of the car according to the leasing company was $104K. They set the residual in the mid 60K range, so I dont have to do the math to tell you that my lease payment is, well, way under $1K per month!!! So I have a 996TT for less than most are paying for a 996 coupe.
Leasecompare BTW is a great outfit, great people, etc. I used them rather than local sources.
Chris Brown
01 TT
73 RSR Replica
My 01 Turbo had a sales price of ony $83,400, but the "Fair Market Value" of the car according to the leasing company was $104K. They set the residual in the mid 60K range, so I dont have to do the math to tell you that my lease payment is, well, way under $1K per month!!! So I have a 996TT for less than most are paying for a 996 coupe.
Leasecompare BTW is a great outfit, great people, etc. I used them rather than local sources.
Chris Brown
01 TT
73 RSR Replica
02-26-2003, 10:08 AM
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If you think about future value (i.e.residual and market value). You have to separate the each one.
Residual is set based primarily upon historical values and Manufacturer intervention. The market value will be set by future demand.
The real question in determinng whether the X50 package is worth the money relates to future market value (aside from the additional benefit of enjoying it while you own the car).
If you think of the X50 package as a Turbo S (like the 993 TT), then I think over time the market will reward (or punish you less) you for having the rarer model. The limited edition Porsches have always done well. I think the fundamental problem with the 996 TT is a) Porsche produced too many and b) they are producing for a third year. I think in previous years there were only 2 model years.
This is the logic (incrementalism) I used to talk myself into a GT 2 and 996 X51 package. so where do you stop.. the Carrera GT?.
I haven't driven the X 50 but if the relative improvement is anything like the improvement of the X 51 package then it's worth the extra $. There is significant difference between the the GT 2 and the 996 TT but it's not a direct comparison because of the AWD and worth every penny.
The guys I talked tried to persuade me to buy the X 50 over the GT 2 because they felt it was all around more driveable and had most of the performance of the GT 2. I agreed with that argument except I felt that the AWD diluted the handling and thrill of driving a Porsche, I used to own an RS America and i wanted that feeling back (RWD). The driveability of the GT 2 is also excellent (except for kerbs).
The 996 TT is an extremely easy car to drive and for that reason I considered it a very dangerous car because it can lull you into a false sense of security or capability. On the other hand its got a lot of Technology to help you out.
Probably more than you wanted to know, but I hope it helps you .
Residual is set based primarily upon historical values and Manufacturer intervention. The market value will be set by future demand.
The real question in determinng whether the X50 package is worth the money relates to future market value (aside from the additional benefit of enjoying it while you own the car).
If you think of the X50 package as a Turbo S (like the 993 TT), then I think over time the market will reward (or punish you less) you for having the rarer model. The limited edition Porsches have always done well. I think the fundamental problem with the 996 TT is a) Porsche produced too many and b) they are producing for a third year. I think in previous years there were only 2 model years.
This is the logic (incrementalism) I used to talk myself into a GT 2 and 996 X51 package. so where do you stop.. the Carrera GT?.
I haven't driven the X 50 but if the relative improvement is anything like the improvement of the X 51 package then it's worth the extra $. There is significant difference between the the GT 2 and the 996 TT but it's not a direct comparison because of the AWD and worth every penny.
The guys I talked tried to persuade me to buy the X 50 over the GT 2 because they felt it was all around more driveable and had most of the performance of the GT 2. I agreed with that argument except I felt that the AWD diluted the handling and thrill of driving a Porsche, I used to own an RS America and i wanted that feeling back (RWD). The driveability of the GT 2 is also excellent (except for kerbs).
The 996 TT is an extremely easy car to drive and for that reason I considered it a very dangerous car because it can lull you into a false sense of security or capability. On the other hand its got a lot of Technology to help you out.
Probably more than you wanted to know, but I hope it helps you .
03-01-2003, 11:05 PM
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If I were doing a lease I would want the residual as high as possible.
1. It lowers your payment.
2. The leasing company will sell you the car at just above wholesale at the end of the lease regardless of the residual. I have bought several other peoples leased cars this way.
I personally cannot lease a car because I am too ADD when it comes to cars. I just had an M-5 a whole 3 months.
1. It lowers your payment.
2. The leasing company will sell you the car at just above wholesale at the end of the lease regardless of the residual. I have bought several other peoples leased cars this way.
I personally cannot lease a car because I am too ADD when it comes to cars. I just had an M-5 a whole 3 months.
03-02-2003, 07:10 AM
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Jim is right, there's no downside to a high residual. If you end up wanting to buy the car at the end, see if they will make you a deal by lowering the price or walk. Most times you need to stay close to term on leasing or take a financial bath. Also consider buying if you have the ability to raise funds b/c there are big discounts, even on ordered cars. At least with buying you are dealing with only 1 or 2 current factors: price & interest(if financing).
