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Issue discussed was depreciation, not leasing. All I'm reminding people is that depreciation is the difference between what you actually pay when you buy something less what you receive when you actually sell that same thing for later in time. You have to look at actual selling prices--both at time or original sale and later resale. Not MSRPs (unless it was sold at MSRP). Nor can you base it on what the dealer resells your trade for. You likely got wholesale; dealer sells at retail. And projected lease residual is not actual depreciation.
Market, vehicle, and other conditions all impact what your realized depreciation will be.
BMWs tend to depreciate less than many (most?) other marques. But most BMWs do depreciate and more than we'd like to think. And the deep lease subsidies, rebates, discounts, financing deals, and other incentives out there today, at or near record levels for many marques, have worked, on average, to lower used car prices in today's market.
I agree that with a lease you really don't own anything. But, few BMW owners seem to own their BMWs for a long term. Hence, my suggestion to "cap" the cost (AKA depreciation) via a lease.
Now, a lease is not for everyone, but a large percentage of BMWs are leased. For the record, I am the exception to the rule. I recently leased a BMW, also recently purchsed a BMW, and just sold a BMW after 17 years of ownership. I've experienced it from many angles, and I think leasing may be worthy of investigation.
Happy Motoring,
Jack
Make Model September 2003 August 2003 YTD 2003 YTD 2002
BMW 3 Series 5,515 5,526 53,491 50,667
BMW 5 Series 2,911 2,061 33,129 28,932
BMW 7 Series 1,457 1,817 14,410 16,296
29,394
BMW M5 64 28 1,356 1,248
Mercedes-Benz E-Class 4,499 4,113 38,629 23,226
Mercedes-Benz C-Class 4,131 3,537 38,871 34,646
Mercedes-Benz S-Class 2,025 1,622 15,981 14,534
If you re-read all my posts on this subject (7589, 7596, 7606, 7627, 7634, 7637, and 7644), you'll see I did NOT mention 50%. Please read them over.
Only numbers I gave were based on my actual experience. My loaded '98 540i6 had an original MSRP around $57,000. She was built in 11/97 and originally sold in 2/98. I bought it CPO at about 52,000 miles in 11/01. I paid about $35,000 for it (but there was a trade-in involved). When I sold her at about 79,000 miles in 9/03, I received about $17,500 for it (but it was a trade in so that isn't exact). So I did lose 50% of what I paid for it in less than 2 years. Since I do not know what the original buyer paid, I cannot calculate depreciation over the first 79,000 miles. I can roughly say that comparing original MSRP to recent sale, she lost around 69% of her value. That was since 2/98 and over nearly 80,000 miles. The next buyer likely will pay over $20,000. That will restart their calculation.
I might also add that head protection system which is standard on the car will protect against head injury. It's a tubular balloon that extends from the A-pillar to the C-pillar and is wrapped in a "sail" type of cover. It's brilliant.
I don't use the BMWFS residual numbers to figure depreciation. Those are subsidized leases with bloated residuals (although I will admit these BMW subsidized residuals lower the lease payment to the first owner). I just checked the latest 'unbiased and non-subsidized' residual numbers (via ALG) for a 2004 530i (E60) and it is 52% for 3 years at 15k miles per year (I would never sign up for less than 15K miles per year on a lease). Therefore, at the end of a non-BMWFS finance company lease, I would be able to purchase the $50,000 E60 in three years at $26,000. This can easily be done by finding a leasee that is near the end of his 3-year lease and offering to buy him out by paying the residual (or a little over). Sites such as leasecompare.com and leasetrader.com are great references for this type of transaction.
Thanks.
2001 Prelude Type SH, 2022 Highlander XLE AWD, 2022 Wrangler Sahara 4Xe, 2023 Toyota Tacoma SR 4WD
Please tell me you put down some cap cost reduction on that lease. $446/mo. for a 530 with those options and 15k miles a year? Holy cow. I have an '01 525 with just the convenience pkg. and I've been paying $667/mo. You're killing me.
I was able to have mine activated as both of my kids are older. If you get them with your small kids, you could power them later when they are older. Not much assurance now, but something to consider. If you only have one, you should put them in the middle seat for safety.
-Paul
Welcome! Feel free to drop me an email if I can help you find your way around.
A friend of mine here in DC is doing just that. He was planning to pick up the car in January, but is now considering postponing to April (spring break) so he can take his kids and wife on the trip and also get the nav system.
Going the ED route makes even more sense with a "hot" car that dealers are unwilling to discount for US delivery. My dealer readily admits that he will discount an ED 2004 530i to $1,200 over invoice, but the best he could do for US delivery is $500-$1,000 under MSRP. That is a whopping difference of over $5,000, n/i trip expenses. The ED cars do NOT come out of his precious US allocation, but DO count towards their sales volume/bonuses. That's the best of both worlds for a BMW dealer, hence the willingness to discount.
Regards....JL
ksso
Here in the DC area, according to others, Passport will go to $1,200-$1,500 over ED invoice. I would likely go with VOB or Tischer if they could match that deal, as they are closer to me. I also stopped in Arlington BMW last week to look at the new 5-series and they indicated they would ddiscount ED, but we didn't get into specifics. I'll know a lot more when I actually get ready to buy, but that may not be until next spring and I am not yet sold on the new 5.
Many BMW dealers will not volunteer that ED prices are negotiable. But once they know that you know they are, the pencil comes out.
1. Available for E39, E46 & X5 with build date of 3/02 or newer.
2. ALL kits are installed at the dealer so prices are the same for kits installed before or after delivery.
3. List price for the kit is $608. I paid $488.00 plus UPS shipping. There are additional brackets required for pre MY2003 cars.
This is a DIY install and it is recommended you have the dealer program the OBC, but my system worked without having to do it.
Check Circle BMW's BT page for more info:
http://www.circlebmw.com/parts/blue/blue.htm
You will need a BT phone and only GSM service is offered on BT phones. GSM service is up and coming, but DOES NOT have the same coverage as TDMA or CDMA service, so do your homework when you are considering BMW BT.
BTW, BT will not be avaibale in the new E60 until December, 2004!
Hope this helps...JL
Check out the Z18 prototype on www.bmwinfo.com its awsome.
I just came from the BMW dealership this afternoon. And i lease the 04 530i including the premium package, sport package, xenon lights which the total came up to $52,770. since this is my first time leasing maybe someone can help out be letting me know if i got a nice deal or not. first of all the guys at the dealership told me that the new 5 series only a few production have the sport package they are not making them anymore. if that's true please let me know. the deal a got on the 530 was $51,270 he knock down $1500.00 of the MSRP. Now i wanted to keep my payment a bit low so i put down $5000.00 after he added up all the other fees the final out of pocket was $6830.00 and my monthly payment is $531.00 a month. Now i normaly buy my cars when i purchase them, my last 2 and put down a great substantial amount on it when buying. Like i said before this is my first time leasing please le me know if i'm paying too much a month and did i put down too much any info will be appreciated thanks.
More importantly, should I consider extend my warranty at all?
In the ads for the BMW dealers, there were no photos for the E60, and no ad space on the E60 --with exception of one small item on a "2004 525" that used a picture of an E39 (!). All others were well represented with photos, deals, prices etc.
Point: Seems an odd decision to not give prominent space to the newest car in the line. Even if sales were good, I'd think the dealers would give prominent space as a traffic "draw" into the dealers from a new hot car. Anyone with any facts on sales volumes? Is the car being discounted more than usual?
Thanks--
I'm not a fan of leasing. Always hard to tell if you got a good deal. Best are when manufacturer is heavily subsidizing the lease. Doubt BMW is doing that right away with new E60.
Seems like you put a huge amount down. $5K plus another $1.8K in fees. One reason to lease is to avoid having to put a lot of money up front into a depreciating asset. If you divide the up front costs by the number of months for the term, what is the monthly allocated cost of these fees?
Did you put down mulitple security deposits? That can save some money, but heard BMW FS was cutting back on that.
Not sure what the dealer told you about the Sport Pkg. BMW is making E60 5 Series with Sport Pkg.
thanks
Thanks Herb Strachman
Good luck - let us know how it goes.
Have you inquired abut leaving the money in multiple security deposits? That lowers your payment by lowering your interest rate (money factor) and you get the money back at the end of the lease.
What is the Money factor the dealer is charging you?
What is the dealer quoting you as a residual value for the end of the 42 months? I think he's quoting you a 57% residual (unless my calculations are off which is possible) which on a brand - new model isn't too bad.
So you're $531 a month really translates into leasing a car for $650 a month.
2001 Prelude Type SH, 2022 Highlander XLE AWD, 2022 Wrangler Sahara 4Xe, 2023 Toyota Tacoma SR 4WD