Never leased a demo but I’m looking at an XC90 demo and curious any pitfalls I should look out for.
I’m also turning in an XC90 off lease and realized how picky they are about tire wear even though I’m way under miles. Imagine this would be a concern for a demo car.
Downsides are it’s been driven and will have some wear on it before you get the keys. May also have already been registered so you may have to eat registration fees whenever the plates are due for renewal. Warranties or covered services will vary depending on when the car was punched.
All this and more is why we target them for 
deals
So if a car has a 3/36k warranty but is a 12mo loaner, someone may lose the warranty in the 3rd year of their lease?
Lots and lots of farts in the seats
I believe it would depend on the manufacturer and lease terms. Just a guess
I think it varies by manufacturer but IIRC I believe some makes would lose the last year of covered maintenance in that example. I know my loaner contracts have generally labeled cars as used and sold as-is, so had I purchased instead of lease, I’m not sure what those warranties would look like but I imagine many manufacturers wouldn’t just extend the new car warranty to 3/36k + whatever is already clocked at time of sale.
However if you leased a loaner that spent 12 months in service, it would fall under CPO
Yes, this is correct in many cases
Others have mentioned the wear and tear but specifying to XC90, one item is brakes. The car is heavy and goes through brakes quicker than other cars in my experience. Warranty is 4 years/50,000 miles so shouldn’t be an issue unless you plan to drive over this during the lease.
EDIT: totally missed the part where you have a XC90 already so you might be familiar with the brakes.
That is the case with my BMW loaner. The clock starts ticking when the car is first put in use/service. The 4-year warranty as well as the 3-year free maintenance starts from the day the car is put in service.
Thanks! I haven’t had an issue with the brakes and fortunately the inspection didn’t mention them as an issue. But the fact that we are 3k under miles but they’re docking us for tires is annoying.
Why annoyed? Tire wear and replacement is part of the deal when leasing. And tire wear is not just a function of miles, it is mostly about how it is driven…hard on cornering, hard on braking, etc.
Totally get it. But we do not drive it hard at all. If we were closer to mileage or over I’d understand but 3k under is a pretty big gap imo to be docked
Again, your mileage has nothing to do with being docked on tire wear…they just take a depth gauge out and boom there it is! 
Some tires don’t last even 20k miles (ContiPro on my S60, for example)
Yep, OP can go to local tire shop or look online to replace with used for less too.
Pre-Covid article, but still applies:
CPO demo/loaner is the best way to go, IMHO.
This is why excess wear can be valuable - especially on cars that don’t do well with tire wear because of subpar OEM tires
Are there any guidelines when it comes to what discount makes sense for loaners? E.g. additional 5% + 1% per 1000 miles off MSRP (some loaners/demo have 5000 miles, some 500).
(I know there is a formula for the residual)
Make sure your lease ends before the warranty ends and warranty issues are moot.
You won’t have the new car smell. Oh well.
If you’re on the hook for maintenance there’s a slight cost on your end. Say first maintenance is due at 10k miles and it has 3k miles on the clock when you get it. Then you’re effectively doing a 7k maintenance for the same cost.
Someone may have farted on the seats ahead of you. This may be a deal breaker for some.
And as was mentioned already, used tires is the way to go if you need to replace before lease return, even otherwise. There are a TON of barely used tires for sale at 50% or more off retail prices. Especially winter tires. I’ve bought and sold several sets myself over the years. People will pay $1200 for new Blizzaks and then sell the car 7 months later. So they’ll sell the tires for $500 on fb marketplace and you offer $400.