what I see few people talking about with buying is the tech/obsolescence risk of buying a new car currently.
Safety and self-driving tech are evolving rapidly. It’s going to be dramatically better in 3 years. EVs will be dramatically better in 3 years. And even cars with 8" touch screens are starting to look dated to me.
Maybe I’m placing too much of an emphasis on it, but a 2021 car in 2024 is going to seem OLD. Why can’t it drive itself in a traffic jam? Why does the infotainment system suck so bad?
Not to mention there’s a non-zero chance we could get a big public infrastructure build-out for EVs. Maybe nobody will want a gas-powered car in 4-5 years. If this happens, buyers will be bag-holders, leasers will be okay.
This risk is a new risk, and I think it tips the lease vs. buy decision firmly towards lease.
I used to think the same, but now I’m not so sure. We are 4.5 years into the MY2017 standardization of safety tech across several mainstream OEMs… is the tech dramatically better now?
EV for sure makes no sense to take the obsolescence risk, especially when they’re frequently cheap to lease
At this point wouldn’t it just make a lot more sense for automakers to just create some kind of infotainment alliance/standard like Blu Ray, Bluetooth, some other Blu(e?) thing, etc that leverages Carplay and Android Auto more? I’m sure they could even develop their own individual app or skin for it too if they really wanted. Smartphone penetration is so ubiquitous now so why not offload that and share the cost of developing something that would be more intuitive, quite possibly standard across the board and wouldn’t necessarily ever become obsolete?
That might be true but I dont think that is what we are discussing here. The idea here is as a cost, buying a vehicle AND keeping it long term will be cheaper in a fixed term.
This issue however, as usually with a article written for the majority of the gen pop, is that numbers used are inherently not the best deals possible, but rather one thats easily doable at any dealership.
The real motivator if any for the auto industry is when anyone, and I mean anyone can sell a certified Level 3 system in volume. Thats when the word “dramatic shift in strategy” will make folks “bag holders”.
I’m not holding my breath on any of this since the disruptors (tesla, Waymo, etc) are quite a ways away and the the ole stalwarts of safety (volvo) are pulling back and saying the timeline needs to shift back.
Realistically the obstacle isn’t even technology anymore as much as it is infrastructure and the ability to implement the items needed on the road, which is mostly out of the automakers hands unless they are willing to collectively pay for what is needed to make these things truly work.
I think “tech” falls into two categories: UX for infotainment and the autonomous driving.
I don’t think we’re there yet. I think we’re in the BetaMax vs. VHS vs. laser disc era right now.
Also, I think auto makers are trying to turn this into an Apple vs. PC (or iOS vs. Android) thing to lock you into their ecosystem since the “skin” of the future might end being the physical car itself (incl the propulsion system)… MB is planning (or has already released) some sort of in-car subscription service and is hoping to make $ off that. I’m too lazy to look up the references, but the articles can found w/ a quick internet search, I assume.
I also imagine that neither Apple nor Google what car makes developing an overlay for their interface. I know I wouldn’t. You get used to “pure” CarPlay or Android Auto and then… it just becomes really easy for you to move into whatever car they end up creating on their own (or through partnerships).
As far autonomous tech goes, there are already efforts to create some type of industry-wide standards:
I’ve actually found on multiple occasions that the combination of leasing and buying turns out to be the best bet.
e.g 1 - In 2019 I leased a Jag E Pace - MSRP about $49000. Dealer was offering $10,000 off MSRP when purchasing and $15000 off if leasing (obviously with a higher MF). I leased it for $549 with only first month DAS, and then in a few months purchased it via lease buyout for ~$36000 (inclusive of taxes, in VA if you buyout your lease vehicle sales tax is not required again since full upfront sales tax is already added to the lease)
e.g. 2 - In Dec I leased a 2021 Q5e, MSRP $59900, $619 monthly with 1st month DAS. The dealer gave a big discount but marked up the MF. I did a lease buyout for about $47000 in Jan, so the car basically cost me $47619. Again no extra sales tax in VA.
I agree, but the extra discount came with a marked up MF, so over the life of the lease they would get back a lot of the discount by way of interest. Buy buying out the lease I got the benefit of both the higher discount and a lower APR loan.
I was using these as an example to show that sometimes leasing and then buying can result in the best possible deal as opposed to just leasing or buying.
I would only think that makes sense if you are leasing-to-buy. That has worked in the past on the Kia Stinger, but there are few scenarios where leasing-to-buy works well when compared to leasing or buying.
Take the LS500 purchase I posted last year. There were $9,000 in cash incentives on that car and only $4,000 lease incentives. It made no sense to lease that car since you were losing $5,000 in incentives and how well Lexus holds its value in comparison to a 49% RV quoted for a LS500 over three years, 15,000 miles.
