Say mid-size (2row or 3row) SUVs, there’s plenty of deals on BMWs, Audis, Merc EQ, Volvos, but rarely on Lexus, Acura, even Hyundais. Is it because Euro brands are so undesirable these days?
Like a $70k Lexus lease can cost more than $100k Audi/BMW. If Euro brands suffer more from depreciation, shouldn’t their lease run more expensive?
(source: quotes I got from a reputable broker in nor-cal for 3-row SUV, even Hyundai Palisade Caligraphy (msrp $54k) run $800+ which is what people pay for $80k Mercs/Audis here).
Are the great deals on SUVs from European makes mainly on EVs?
Lexus only recently introduced EVs, and Acura and Hyundais don’t have any large EV SUVs (aside from the recently introduced Kia EV9), IIRC. The $7500 rebate makes a big difference, as well as eagerness to get rid of aged inventory…
ICE GLEs, X5s deals are not great (although X5s tend to lease better than GLEs?), I think.
not limited to EVs. X5 runs 10%+ discounts in nor-cal, don’t ever see that in Lexus RX/TX.
Lexus doesn’t need to incentivize people to buy RXs, and the TX was just introduced…
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Not current, but discounts were there.
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I find it counter intuitive for leases, big selling point for Lexus is long term reliability, which matters much less for 2-3 year leases.
Then just purchase/finance, the only Asian product I ever leased was a $99 Leaf ($1500 DAS)
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I think good leases exist for Infiniti/Nissan and some Acuras. At least some of it comes down to desirability - No one is going to pay full price for a QX80 because it’s not that good.
Toyota has historically never been big on discounts, either purchase or lease, they would rather produce fewer, sell for full price and keep residuals up rather than overproduce and discount. They are a very conservative company and that’s just how they roll.
When Car & Driver or whoever are doing comparison reviews all they can compare is MSRP to MSRP, and every time they compare a MB/BMW to the competition it’s always “the BMW has some slightly nicer touch points but is quite a bit more expensive”. They never buy the cars themselves, so they don’t know or care what people actually pay for cars. Once you account for discounts and subvented leasing the truth is that the BMW is a slightly nicer car that probably only cost slightly more if you work on the deal a bit.
A lot of the decision-making comes down to RV. Do they want to take RV risk? How much of a bath will they take if all those cars comes back underwater? Do they have a strong CPO conveyer belt to keep all that metal moving?
Apples to oranges. Compare the Hyundai above to an equally optioned 3-row gas suv from BMW or Mercedes such as the X7 or GLS.
It’s basically limited to EVs. That 10% “discount” gets you … what? A $900 basic X5? If so then pass.
As far as EVs go, Hyundai or Nissan deals were just as strong as Mercedes.
Audi EVs they still seem to have decent lease cash
What you are seeing is a difference in business models. If you look at actual sales data, Audi and BMW had a record year in 23 (no MB numbers yet). Lexus is still down significantly from the mid-teens and even 2021. Your big 3 Germans are all about sales numbers. Put as many on the road as possible and one way to do that is with attractive, subvented leasing programs. When the cars come back in 3 years, they write them down as a loss if needed which is offset by new car sales volume.
Lexus and other brands might not want to have a business model where they are subventing leasing programs and the financial risk that could come with lease returns. It is a safer business model to lease cars at/above market so they can minimize future risk.
And within all of that, some cars don’t make sense to have aggressive leasing programs. Hyundai doesn’t need to incentive Palasides since it is a hot model while they might need to on an Elantra.
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Toyota is always amongst the biggest car brands in America and usually sells more cars globally than any other automaker. Their discounts might be lower than other automakers but that is because MSRP is basically a made up number. Cars have a value the market assigns and Toyota’s MSRP is closer to that number.
I would argue that Toyota’s RVs are beyond conservative. As far as I can see every Corrola and Camry has an RV in the mid to low 50s for a 12k/36 month lease over the past ten years these types of affordable recent model year Toyotas with no more than 36,000 miles, have generally been worth north of 70% of their MSRP after three years.
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So that implies that everyone who leased a Toyota overpaid for their lease. They would have been better off buying it, or at least buying / trading it after lease ends.
Same for Honda and pretty much all Asian brands, they don’t want to take any RV risk.
Now they’re not going to say “you can’t lease our cars” because there’s a certain percentage of people who will lease no matter what, and they need to cater to those people too. They’ll just do it without taking any risk on the backend.
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Good thing with a TFS lease is that they allow the lessee to capture the equity via a 3rd party buyout with virtually no restrictions or “market rate” crap that others do. Could that change in the future, sure, only time will tell.
A few years ago I was able to lease a well optioned Tacoma for effectively $311 / month then sell to Carmax at the end for $4600 obv lowering my tco. That was 13 months ago and the spread has narrowed. In leasing vs purchase I didn’t owe sales tax on the whole $40,000 which is enough to consider in the calculation.
On this thread in general on discounts, keep in mind a company has to mark it up first to then mark it down. What changed? 3/4 of America now “thinks” it’s a good deal.
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Honda has always been like that, when I bought my 2018 Accord Honda claimed a 36/12 RV of 52%. But when I looked today they have RVs in mid 60s for CRVs, Civics and Accords, which is approaching correct, if still conservative, when you factor in a certain percentage will come back with dirty Carfax reports.
It’s still conservative, considering the data underpinning the RV is from a very high resale value environment.
Nonetheless exceptions often exist. Last February or March had good lease programs from NMAC on many Nissans. OP could have compared a Pathfinder Platinum to an equally optioned German 3-row suv then and come to a completely different conclusion.
Look at these numbers from just before the pandemic. 11% discount, 0 interest, 6000 rebate. I don’t even think Lexus gives loyalty anymore.
2019 Lexus RX350 AWD Fsport
MSRP: $57,750
Sell Price: $51,000
Monthly Payment: $444+tax
Drive-Off Amount: $2,000 (1st mo+ drive offs)
Months: 27
Annual Mileage: 10,000
MF: .00001
Residual: 59%
Negotiated discount: $6,750
Incentives: 6,000 rebate
Region: SoCAL
How did I do?
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