Tesla does not allow lease buyouts on Y/3 as far as I know.
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As of now they don’t. But as with all things Tesla, things could literally change overnight. 1/1/2024 may only be ~2 weeks away, but 2 weeks in Tesla time is an eternity/.
I am trying to lease a Kia Sorento PHEV and all the dealerships are acting like I am crazy asking about the $7,500 Credit on the lease. Has anyone been able to get this credit on a Kia PHEV recently? I saw someone did back in January 2023 here.
High demand for that model. Kia isn’t passing the full incentive on for leases… at least not in SoCal.
I think it’s around $4500 right now.
Kia (The bank) is only giving $2k, so you basically told the dealership to give you $5000 for free. That’s why they looked at you like you were crazy.
As I understand the federal requirements the lease on phev gets around the USA assembly requirements so it qualifies for 15% or $7,500.
I am assuming they are taking the $7,500 and just not passing it down otherwise I can make no sense of it. It would be money left on the table which is very unlike a car dealer.
I found a dealership that is advertising it through Ally CCRA program that I am going to contact but they are out of state.
The leasing company gets $7500 when they purchase it. There is no federal requirement for you to get a penny. The lessor can pass on however much they want to. In this case, they are giving a $2k incentive.
Ally may be giving the full $7500 as an incentive, but I’m sure they’re making up for it with a much higher money factor. That’s their MO.
The sense is PHEVs are selling without any need of help, so why give $7500 and cut into the EV sales?
The more I think about it, they for sure have to be taking the $7,500 credit for themselves if they are not passing it down to the customer. What is shady is that they act like they are not and that its some crazy idea they have never heard of. Even though they may not be passing down the credit I feel we should be allowed to know that they are taking $7,500 because of our lease. I feel like a claim could be made with the BBB. I realize they wouldn’t be required to actually pay the $7,500, but they would at least be required to formally respond to the question instead of hiding.
For the the Kia Sorento PHEV I am trying to lease they are already charging about $10k for lease financing and they want to also make an additional $7,500 by taking the credit.
Side note, it is interesting how confused dealers get when you do the math on their deals to show them how bad they are…
Nothing shady about it at all. There’s no hiding of anything. The dealership doesn’t control the $7500, the bank does. The bank doesn’t need to put any kind of incentive on the PHEVs so they reap all the benefits.
If you show me the email you sent to Kia Financial and where they said they don’t get $7500, then I will believe you.
Yes, that’s business, making money is business.
They are confused that they realize they have a ‘smart one’, dealers like ‘dumb ones’
All in all, I know you want the best deal, everyone wants the best deal, but sometimes the bank doesn’t need to give you a ‘best deal’ because that car sells nicely by itself.
You are correct, I should contact Kia Financial Directly. I have only been speaking with the dealerships and they deny knowing anything. I will email Kia and report back.
When you lease, the bank absolutely 
takes any money they are eligible for including clean fuel tax credits. The dealer never see it, never gets paid on it, and on a purchase neither party sees a penny of it. For the people customers interact with, it isn’t an act.
It’s their tax credit for their purchase. They have no obligation to share any of it if they dont want to.
Wanted to give an update on this. It was not easy, but I was able to do it!
I was not able to get the $7,500 off through Kia Financial, but I was however able to get the $7,500 off by leasing through Ally Bank. Once I obtained my lease from Ally I went to my local credit union and financed the car through them and they bought out the lease. This will save me about $22,000 over the next 3 years vs leasing with Kia directly factoring in the residual at the end of the baseline Kia lease.
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Was Ally ok with the buyout? They are a pain with everything leasing.
They seemed okay, no issue with the buyout. They say no third-party buyouts on their website but my assumption is that my credit union just sent a certified check as if I would have bought it out.
Hmm…well at least it appears they have relaxed it as it used to be a ‘personal check’ maybe I’m confusing them with US Bank.
Fantastically helpful thread! I am considering leasing a Kia Sportage PHEV, ideally through Ally so they can pass along the federal tax credit via a CCRA–assuming I can find a dealer with the model I want who’ll provide the Ally pass-through on a PHEV.
BTW, it appears that the financing unit doesn’t actually get the full $7500 for PHEVs leases. The link below goes to a PDF from the Congressional Research Service that has the full scoop. Here’s the relevant info from this document as it applies to PHEVs, which are referred to simply as “hybrids” below (don’t get me started on that conflation, which I’m seeing all over the place these days!). Bold face is mine:
“In lieu of the CVC [clean vehicle credit], businesses purchasing new EVs may choose to claim the CQCCV [credit for qualified commercial clean vehicles]. The CQCCV is calculated differently from the CVC, is not subject to domestic content or manufacturing requirements, and can be claimed for vehicles used in the ordinary course of business or leased to customers.
The CQCCV may be claimed for all-electric vehicles, fuel cell vehicles, and certain hybrid electric vehicles. The credit differs by vehicle type, as discussed below:
• For hybrid vehicles, the credit equals the incremental cost of the vehicle or 15% of the vehicle’s cost, whichever is lower;
• For all-electric and fuel cell vehicles, the credit equals the incremental cost of the vehicle or 30% of the vehicle’s cost, whichever is lower.
A vehicle’s incremental cost is defined as the additional cost for an electric, hybrid, or fuel cell vehicle as compared with a gas- or diesel-fueled vehicle of similar size and use. Hybrid and all-electric vehicles must have a battery capacity of at least 7 kilowatt hours if they weigh less than 14,000 pounds and at least 15 kilowatt hours if they weigh 14,000 pounds or more. The CQCCV may not exceed $7,500 for a vehicle weighing less than 14,000 pounds. For vehicles weighing 14,000 pounds or more, the CQCCV may not exceed $40,000. Certain heavy-duty vehicles ineligible for the CVC may therefore qualify for CQCCVs.”
So, for example, if the MSRP on a Kia hybrid is $30K and on the equivalent PHEV is $40K, then the incremental cost is $10K, and 15% of the vehicle’s cost is (0.15 x $40K) = $6K. Thus, if I’m interpreting this correctly, the tax credit would be $6000 rather than the standard $7500.
I think you are over thinking this one. It is a lease so you were never going to receive the CQCCV. It shouldn’t really matter what the bank was able to claim or not. You should just care about whatever incentives/rebates/credits the financial institute is offering. Right or am I missing something?
It should be as simple as verifying the credits/incentives that banks are willing to provide for the car you’re interested in, and determine if the numbers work for you.
E.g., Toyota offering $17,750 rebate for 2023 bZ4x, Hyundai offering $10k for Ioniq 5 and Ioniq 6, Toyota offering $6500 credit for Prime RAV4, etc. I wouldn’t care what the bank is getting from the government but only care what they are offering me.
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Exactly! My main interest in researching this was to see how much the financing groups would get via the EV Lease credit for PHEVs, since a couple of folks had told me (erroneously) that the Kia PHEVs weren’t eligible because of battery size. It was satisfying to get to the bottom of the Q and find out that, indeed, they were eligible—but ultimately, as you point out, Kia isn’t obliged to pass through any of whatever such federal credits they do get.