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Unfortunately I can name almost ten other luxury cars that are almost $20,000 dollars more that have payment options much lower than what Ford has currently. I picked the MachE and not those other options for a reason. It's not over yet!
You are correct about many cars with MSRP being much higher that will wind up costing less.

That indicates to me at least, that with time, the market will stabilize and the cost of the MME will come down.

If you can wait, I would.
 

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It will be worth a lot more than that balloon payment. Don't turn it in! Sell it or trade it.
I too get the feeling Ford is being too conservative with the residual here. While I don't think the MME will retain value like a Tesla, we're in a new paradigm here: A BEV with 30-40K miles might need a new set of tires, but it's a long ways away from needing new brakes, or other high cost, extended interval maintenance items and there's just simply less parts to wear out. If Tesla's have shown us anything... the worry over battery longevity is overblown. In 3~4 years time, not many people will care. There's also battery health reports coming for used cars (sort of like Carfax).

Put it another way... In 4 years, could we sell used MME Premium 4XE for more than $21,204 if we keep the miles to ~40K? My gut tells me it's going to be worth more. If not... we'll just keep it.

The worth/value is something that
Unfortunately I can name almost ten other luxury cars that are almost $20,000 dollars more that have payment options much lower than what Ford has currently. I picked the MachE and not those other options for a reason. It's not over yet!
That business model has been working great for the European luxury brands. Very attractive lease with a high residual, take it back, sell it under their CPO program. Both the original leasee and the CPO purchaser drives the car under warranty (If I learned anything over the last ~35 years of owning cars... it's never ever drive a European car out of warranty). The most economical way of driving a high end European car is to purchase it CPO and trade it in before the extended warranty runs out.
 

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I too get the feeling Ford is being too conservative with the residual here. While I don't think the MME will retain value like a Tesla, we're in a new paradigm here: A BEV with 30-40K miles might need a new set of tires, but it's a long ways away from needing new brakes, or other high cost, extended interval maintenance items and there's just simply less parts to wear out. If Tesla's have shown us anything... the worry over battery longevity is overblown. In 3~4 years time, not many people will care. There's also battery health reports coming for used cars (sort of like Carfax).

Put it another way... In 4 years, could we sell used MME Premium 4XE for more than $21,204 if we keep the miles to ~40K? My gut tells me it's going to be worth more. If not... we'll just keep it.

The worth/value is something that


That business model has been working great for the European luxury brands. Very attractive lease with a high residual, take it back, sell it under their CPO program. Both the original leasee and the CPO purchaser drives the car under warranty (If I learned anything over the last ~35 years of owning cars... it's never ever drive a European car out of warranty). The most economical way of driving a high end European car is to purchase it CPO and trade it in before the extended warranty runs out.
Totally agree. I learned my lesson with a few Audi's and also you might to just avoid Land Rover even if it has a warranty 😁
 

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I too get the feeling Ford is being too conservative with the residual here. While I don't think the MME will retain value like a Tesla, we're in a new paradigm here: A BEV with 30-40K miles might need a new set of tires, but it's a long ways away from needing new brakes, or other high cost, extended interval maintenance items and there's just simply less parts to wear out.
Modern ICE cars need little to no maintenance over the first 30 to 40,000 miles which are covered by warranty. Brakes last about 30/40K miles as well. So what you are left with are Oil changes plus cabin filter changes which will also be necessary on the MME. Can you be more specific about:

"other high cost, extended interval maintenance items and there's just simply less parts to wear out."




Put it another way... In 4 years, could we sell used MME Premium 4XE for more than $21,204 if we keep the miles to ~40K? My gut tells me it's going to be worth more. If not... we'll just keep it.
You do realize that when the FTC of $7,500 is used up, which will be before the term of the Option Plan ends, Ford just like Tesla, in order to be competitive will have to reduce their price of the MME by $7,500. A 4 year old MME will have to compete with either a new MME at $40,000 or a MME at $50,000 with substantial added content.

The question I ask: If I can buy, finance at favorable interest rates or lease a brand new MME for $40,000, what is a 4 year old MME with 30/40,000 miles worth? I submit less than 50% of new MME, or less than $20,000.

That is why I do not think at the end of the Option Plan the MME will have any equity left.

Finally, in 4 years, there will be many, many EV's will range above 400 miles and rapid charging speeds. Will you then be satisfied with a 4 year MME with a range of less than 300 miles and slow charging speeds?



That business model has been working great for the European luxury brands. Very attractive lease with a high residual, take it back, sell it under their CPO program. Both the original leasee and the CPO purchaser drives the car under warranty (If I learned anything over the last ~35 years of owning cars... it's never ever drive a European car out of warranty). The most economical way of driving a high end European car is to purchase it CPO and trade it in before the extended warranty runs out.
Because of GAP insurance that covers the difference between the residual and the actual value of the car, most returned leases go to auction. Most of the CPO's you find on a dealer lot are:

  • Demos
  • Cars returned before lease end
  • Trade ins
I agree with you that I never want to own a European car beyond the warranty and that is why I lease but never beyond the warranty period.
 

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Modern ICE cars need little to no maintenance over the first 30 to 40,000 miles which are covered by warranty. Brakes last about 30/40K miles as well. So what you are left with are Oil changes plus cabin filter changes which will also be necessary on the MME. Can you be more specific about:

"other high cost, extended interval maintenance items and there's just simply less parts to wear out."
Coolant, Axle oil/differential fluid/... changes, on some cars timing belts still (water pump at that time)... Exhaust components still wear out.... and with enough mileage, plugs... also direct inject engines start needing extensive valve cleaning.
 

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Coolant, Axle oil/differential fluid/... changes, on some cars timing belts still (water pump at that time)... Exhaust components still wear out.... and with enough mileage, plugs... also direct inject engines start needing extensive valve cleaning.
None, I repeat none, are maintenance item within he first 50K miles.

  • coolant: most cars are now life time
  • Axle oil/differential are usually 100K miles
  • Timing belts: 100K miles
  • Water pump: do these still fail?
  • Exhaust components: catalytic converter is 7 years. Exhaust without lead in gas last at least 100K miles
  • direct injection: this a an old wives tale about extensive valve cleaning. I think you have this confused with diesel. Modern gases have detergents so that valve cleaning is no longer done or necessary
Basically for the first 50,000 miles the additional cost of an ICE vs. EV are oil and filter changes.

Now on certain European high end cars, add brake fluid change. Never figured out why on American and Asian cars you never change the brake fluid but on Germany cars every two years. Whatever the Germans are doing, they should change to what Asian and American manufacturers do.
 

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You do realize that when the FTC of $7,500 is used up, which will be before the term of the Option Plan ends, Ford just like Tesla, in order to be competitive will have to reduce their price of the MME by $7,500. A 4 year old MME will have to compete with either a new MME at $40,000 or a MME at $50,000 with substantial added content.

The question I ask: If I can buy, finance at favorable interest rates or lease a brand new MME for $40,000, what is a 4 year old MME with 30/40,000 miles worth? I submit less than 50% of new MME, or less than $20,000.

That is why I do not think at the end of the Option Plan the MME will have any equity left.

Finally, in 4 years, there will be many, many EV's will range above 400 miles and rapid charging speeds. Will you then be satisfied with a 4 year MME with a range of less than 300 miles and slow charging speeds?
If it happens to be that the value is what Ford residual is... than we'll just keep the MME and enjoy it. I think we've all come to the conclusion that this is not an economically/financially a frugal purchase/lease. I've been known to waste money on cars...
 

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None, I repeat none, are maintenance item within he first 50K miles.

  • coolant: most cars are now life time
  • Axle oil/differential are usually 100K miles
  • Timing belts: 100K miles
  • Water pump: do these still fail?
  • Exhaust components: catalytic converter is 7 years. Exhaust without lead in gas last at least 100K miles
  • direct injection: this a an old wives tale about extensive valve cleaning. I think you have this confused with diesel. Modern gases have detergents so that valve cleaning is no longer done or necessary
Basically for the first 50,000 miles the additional cost of an ICE vs. EV are oil and filter changes.

Now on certain European high end cars, add brake fluid change. Never figured out why on American and Asian cars you never change the brake fluid but on Germany cars every two years. Whatever the Germans are doing, they should change to what Asian and American manufacturers do.
Water pumps get replaced with the timing belt as a rule because the labor is paid for already.
For the 2nd and 3rd owner of the car, the high mileage maintenance items come into play and is reflected in the value.

Direct injection issues old wives tale? One of the reasons that auto manufacturers put both direct and port injection is to avoid the carbon deposits.
 

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58% is a fictitious number: it is based on:

  • Ford is keeping the FTC of $7,500
  • Ford has overinflated the interest rate at 5%
To those who use the Option Plan, and rely on the residual in the lease as a benchmark, they maybe, and I suspect will be severely disappointed.
If, as you stated, Ford is increasing the residual value to accommodate for the $7,500 FTC, then they are effectively giving you the cap-cost reduction by building it into the residual the lease is based off. This statement is opposite your previous claim that Ford is denying you the benefit.

I think it is more inline with a traditional lease, where the manufacturers try to keep residuals in-line with predicted recoverable resale value. They do not eat the interest in the residual. Those monies offset the loans backing the lease.


In a post in another thread, I did state Ford’s predicted residual seemed a bit optimistic. But it is no more fictitious than your pessimistic assumptions. It seems strange you are stating your assumptions as fact.
 

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If, as you stated, Ford is increasing the residual value to accommodate for the $7,500 FTC, then they are effectively giving you the cap-cost reduction by building it into the residual the lease is based off. This statement is opposite your previous claim that Ford is denying you the benefit.

I think it is more inline with a traditional lease, where the manufacturers try to keep residuals in-line with predicted recoverable resale value. They do not eat the interest in the residual. Those monies offset the loans backing the lease.


In a post in another thread, I did state Ford’s predicted residual seemed a bit optimistic. But it is no more fictitious than your pessimistic assumptions. It seems strange you are stating your assumptions as fact.
I did not say that:

What I said was because Ford is collecting $7,500 from the Federal government, where they do not when the car is sold, so in effect Ford is getting $7,500 more for each car leased than sold, Ford can set the residual wherever they want, within reason.

I also said that when compared to the interest on financing, .9% or the Option Plan, 2.25%, the interest on the lease, 5%, puts extra money in Fords pockets when they lease vs. either financing or OP, Ford has the ability to once again set the residual wherever they want, within reason.

My point: Once you accept that because of the retention of the FTC of $7,500 and the interest rate of 5%- Ford can set an unrealistic residual, (58%) to then use that residual to determine whether the balloon will be less than the actual value of the car at the end of the lease, so that you have equity in the car, my greatly disappoint people.

Clearly with a residual of 58%, if Ford had included the FTC as a cap cost reduction and interest rates the same as the OP, 2.25%, I cannot imagine anyone choosing the OP over a lease,

If I were using the OP, I would be extremely leery of using the residual percentage in the lease to anticipate the value of the MMW at the end of the OP.
 

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How does the residual value set by Ford (for both Options and RCL) come into play? They are different amounts, reportedly because of the $7500 FTC for Options, and no tax credit for RCL.
[Edit: did not see the above two posts before posting this, but am interested in followup.]
 

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How does the residual value set by Ford (for both Options and RCL) come into play? They are different amounts, reportedly because of the $7500 FTC for Options, and no tax credit for RCL.
[Edit: did not see the above two posts before posting this, but am interested in followup.]
For the red carpet lease, the predicted residual value at lease-end is the part subtracted from the portion of the car included in the lease payments. Interest aside, the higher the residual, the lower the lease payments.

There is no predicted residual set in the Options. But, the resale value of the car is the true residual value when it comes time.

The discussion was around what the potential trade-in value would be under the options. Some feel it will be higher that the balloon, thereby giving you some cash towards a down-payment on the next car. Others feel the MMe will bottom-out on the resale value, thereby you would just turn it in and not get any cash towards down payment.
 

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This is just a repeat of your post #9.

Why do you think this? Can you give us your reasoning using real numbers?

Personally, and I have posted on another thread, I think at the end of the Option Plan, there is high likelihood that the balloon will be more not less than the value of the MME and buyers will just return their cars.
That is a horribly pessimistic view of depreciation - $56,000 to $25,000, under 31,500 miles, in 3 years. I am seriously considering one of these for going back to having 2 cars this fall. If there is any indication that the car is so bad that depreciation will be so high, I will take it off my choice list. BTW, the Audi Q5 I sold to a dealer went from $50,000 MSRP to a sale price of $35,000 in 2 years 8 months. The first Tesla Model 3s that reached the used car market after 3 years were selling for a almost 90% of their new price.

I'll stand by my statement, until shown otherwise, that the Mach E depreciation will be less than ICE cars and much better than the return price.
 

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That is a horribly pessimistic view of depreciation - $56,000 to $25,000, under 31,500 miles, in 3 years. I am seriously considering one of these for going back to having 2 cars this fall. If there is any indication that the car is so bad that depreciation will be so high, I will take it off my choice list. BTW, the Audi Q5 I sold to a dealer went from $50,000 MSRP to a sale price of $35,000 in 2 years 8 months. The first Tesla Model 3s that reached the used car market after 3 years were selling for a almost 90% of their new price.
Remember everyone knows the "real price" is not $56,000 but $56,000 less FTC of $7,500 or $48,500. In that light the figure of $25,000 seems pretty much in line and may in fact be high.

Tesla: 90% is totally incorrect. Suggest you check out Cars.com and you will see the Model 3, after 3 years, has lost 40% to 45% of its value.

I'll stand by my statement, until shown otherwise, that the Mach E depreciation will be less than ICE cars and much better than the return price.
Everyone is entitled to their opinion. At this time no one really knows. But if you are wrong no one suffers but you! It seems to me that you are taking an unnecessary risk - but everyone makes their own financial decisions.

But even with Tesla, if you check out Cars.com, EV's are in fact depreciating faster not slower than ICE. As range increases, charging times and prices decrease what is the basis for your opinion that EV's will hold their value better than an ICE?

So far every EV, except for Tesla, has taken a tremendous hit with regard to depreciation.

Real life and logic would indicate the opposite.
 

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Posting again... If price/cost while going green were the primary motivation, I'd think we'd all be here:
4280
 

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If you extrapolate the Kona cost of $37, 190 and the lease amount to the MME you will realize how out of line both the Option Plan and And Ford RCL are.
If after my 48 months our MME is only worth $21K balloon payment, then we'll just finance the rest and and drive it longer. The only time I'm really concerned with the market value of my car is when I'm ready to trade it in. Yeah... there's going to be lots of shiny new cars fancy features and better specs in 4 years... Doesn't bother me the least that I'll be driving a 4 year old, out of warranty car. Keep it for another few years, then pass onto the kids.

The key reason why this is not a big deal is that we plan to drive the crap out of it. If we use it exclusively for local/regional travel, Probably 60K miles + in the 48 months.

If after 48 months the value holds enough the dealer is willing accept the MME as a trade on a mid cycle refresh MME (either via "trade in value" above the $21K or mileage forgiveness), then I might bite depending on how good the deal is.

It's not unlike when I sell things over Craigslist... someone will say "it's not worth that much!!!" I say "OK... thanks for looking, I'll just keep it".
 

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Remember everyone knows the "real price" is not $56,000 but $56,000 less FTC of $7,500 or $48,500. In that light the figure of $25,000 seems pretty much in line and may in fact be high.

Tesla: 90% is totally incorrect. Suggest you check out Cars.com and you will see the Model 3, after 3 years, has lost 40% to 45% of its value....
Throwing the $7,500 into the depreciation column is ridiculous. I used MSRP for fair comparison of my Q5, I actually paid $47,000 for that $50,000 car.

My quote was from the initial 3 year olds offered before the new car price cuts. Those 3 year old Model 3s had the $7500 credit when they were purchased. If that was discounted from the sale price in quoting depreciation, the used 2017 and 2018 Model 3 would show really good retained value, As it is I see it currently, $45,000 cars selling for $35.000, $ 50,000 cars selling for $38,000, and a $60.000 performance being sold for $44,000. I don't see any 40% to %45% there.
 

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Throwing the $7,500 into the depreciation column is ridiculous. I used MSRP for fair comparison of my Q5, I actually paid $47,000 for that $50,000 car.

My quote was from the initial 3 year olds offered before the new car price cuts. Those 3 year old Model 3s had the $7500 credit when they were purchased. If that was discounted from the sale price in quoting depreciation, the used 2017 and 2018 Model 3 would show really good retained value, As it is I see it currently, $45,000 cars selling for $35.000, $ 50,000 cars selling for $38,000, and a $60.000 performance being sold for $44,000. I don't see any 40% to %45% there.
You are like a lawyer pleading his case. But unlike a lawyer who even if loses gets paid, here if you are wrong you pay!

In any event you should perhaps checkout Cars.com.
 
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