over 90% of customers at my BMW dealer choose leasing instead of financing?

[pbonsalb]

Originally Posted by afadeev

For someone you doesn't provide ANY references to justify his dubious claims, you are awefully picky about clicking on links!


Here you go: BMW sold 50,981 BEVs in 2024, a 12.3% increase from the previous year. When combined with plug-in hybrid models, BMW’s electrified lineup accounted for 70,379 vehicles, or 19% of total sales.

https://www.bmwblog.com/2025/01/03/b...0dip%20in%20Q4.

As the other poster stated, BEV are around 13%. Still a lot more than I believed and still a lot less than you claimed. You are including hybrids, which do not get the 7500 rebate and thus are not more likely to be leased.

I expect the numbers to go down now that the government subsidy is expiring. Anyway, the high percentage of leased BMWs is not significantly due to BEVs because BEVs make up only a small minority of BMW cars sold in the US. The small minority of about 13% is much more than the 3-4% that I believed, and I acknowledged that.

[Wolfman64]

Originally Posted by pbonsalb

Lease payments are less than finance payments so more people lease. Maybe that is the only way they can afford the car, maybe it makes sense for them because they like having a new car every 3 years, or maybe they own or work for businesses that pay the lease and deduct it. They don’t have to worry about maintenance or repairs because they don’t own after the free service or out of warranty.

I leased a car once, but normally buy new or CPO or used and finance the cost. I tend to keep cars for about 10 years so owning them makes sense. I DIY nearly all the maintenance and repairs. I also like to modify my cars and that complicates warranty issues.

I usually could pay cash but would rather preserve it and finance. We have several properties and small businesses and cannot always predict our needs. Predicting cash flow is easier than predicting irregular expenses. Others may have far more cash or have far more predictable lives and find that paying cash is better for their situation.

Leasing is very little to do what people can afford.

Rather it can make great financial sense. Tax-wise for a business, leasing is typically more advantageous.
Leases are fixed costs and can serve as a hedge against depreciation. Not just EV's but most models. It's very rare that the ACV is higher than the residual value at the end of the lease.
If it is you can buy out the lease, if it isn't BMW Financial takes the loss.

As mentioned, the $7500 tax credits were only available for leases for most BMW's due to the low limit of the EV's MSRP. So a no-brainer...

Even without the tax incentive it's a no-brainer due to the shorter lease-terms; this is something of great value when technology moves forward as fast as it does with EV's.

Also, with financing no matter how good (or low) the rates are you will never know how good of a deal you made. That only happens when you sell the car and tally up the costs years later and know how much, or how little you got for your car.

Last but not least, buying a car with cash gives you typically the worst deal and lowest discounts. Car dealers are not interested in cash as the cars financing delivers additional income through the shared-profit models on the financing rates.

[F32Fleet]

Originally Posted by DavyNM

I was talking to the finance dept manager at my BMW dealership the other day. He seemed surprised that I wanted to do financing. I explained that I could get 1.79% for 60 months from my employee credit union, which was apparently better than BMW's own financing.

He went on to say that over 90% of their customers lease instead of finance. (1/3 pay cash, the other 2/3 lease or finance) I thought he was trying to push me into considering leasing, but apparent that wasn't the case. He suggest that I stick to the credit union financing, if I could get it locked in until my new car arrives in a couple of months.

Do most BMW drivers really prefer leasing over financing? Have I been doing it wrong all these years?

All euro luxury models are like this. Most EV's are also leased. A lot of luxury car buyers are small business owners so they can expense the lease payment.

[pbonsalb]

Probably the car companies underestimated how fast BEV would depreciate and lost money on the leases. They may have even been subsidized to begin with to try to gain market share.

[afadeev]

Originally Posted by pbonsalb

Probably the car companies underestimated how fast BEV would depreciate and lost money on the leases. They may have even been subsidized to begin with to try to gain market share.

BMW NA has been famously subsidizing leases on ALL cars for decades to accelerate sales and juice up revenue. Historically, through lower interest rates and artificially higher residuals. In some cases stupid high residuals to hit some "magical" $299/$399/$499/$599 month payment rate. BEVs have been no different.

See for yourself:
https://www.bmwusa.com/special-offers-new.html#/

This approach seams to be working for them, since BMW has been to top luxury brand seller in the US over the last decade.
Think about it - would you rather incentivize your customers to buy a new car every 2-3 years (lease), or every 5-10 years (buy)?

Originally Posted by pbonsalb

As the other poster stated, BEV are around 13%. Still a lot more than I believed and still a lot less than you claimed. You are including hybrids, which do not get the 7500 rebate and thus are not more likely to be leased.

You are wrong again on Fed rebates - hybrids qualify(-ed?) for $4K vs $7.5K for BEVs. The EV game does not appear to be your ball of wax?

I'm not sure what the relative lease take rate is on ECE vs. hybrid vs. BEV. I'm not sure it matters.

The OP's question was whether or not 90% lease take rates are possible, and as defined (non-cash purchases being 2/3s for the transactions, and leases might well be 90% of those) it is.

I'm not saying it's good or bad, just that it is what it is.

Originally Posted by F32Fleet

All euro luxury models are like this. Most EV's are also leased. A lot of luxury car buyers are small business owners so they can expense the lease payment.

People lease cars for many different reasons.
I've usually bought mine, but leased a few. One was because I was waiting on F80 M3 to come out, so I leased an E90 335i to tide me over. Then I leased my first EV since I didn't know if I would like it. I did, so I bought my next few.

YMMV,
a

[scheme00]

Most cars these days are designed to crap out right at the end of the lease period/warranty. Leasing for most is the way to go

[afadeev]

Originally Posted by scheme00

Most cars these days are designed to crap out right at the end of the lease period/warranty. Leasing for most is the way to go

That is completely false.

Please provide verifiable facts, or stick to posting on Twitter/Facebook!

a

[freakystyly]

Originally Posted by afadeev

That is completely false.

Please provide verifiable facts, or stick to posting on Twitter/Facebook!

a

Shh... more cheap barely used cars for us.

[Rob_G77]

Originally Posted by afadeev

BMW NA has been famously subsidizing leases on ALL cars for decades to accelerate sales and juice up revenue. Historically, through lower interest rates and artificially higher residuals. In some cases stupid high residuals to hit some "magical" $299/$399/$499/$599 month payment rate. BEVs have been no different.

Here in Canada, leasing is far more expensive than it used to be. 3 year leases were normal, but at some point (after 2008 market crash?) the standard became 4 years. You can lease a shorter term, but it's far more expensive.

I also think BMW Canada fluctuates (reduces) residual value to keep lease pricing on par with high interest rate financing. Bank interest rates for loans are still anywhere from 6.99% to 8.99%. It's stupidly unaffordable to buy or even lease a new BMW in Canada. BMW finance rates are probably better than bank rates, but they are shorter term.

I just find it disappointing that in the US there is so much done to make leases/financing affordable, but here in Canada we just get royally shafted now. Plus there are additional high taxes for vehicles over $100k. If you bought a $150k vehicle for example, there's $20k luxury tax on top of the 11% sales tax.

Rob

[F32Fleet]

Originally Posted by DavyNM

I was talking to the finance dept manager at my BMW dealership the other day. He seemed surprised that I wanted to do financing. I explained that I could get 1.79% for 60 months from my employee credit union, which was apparently better than BMW's own financing.

He went on to say that over 90% of their customers lease instead of finance. (1/3 pay cash, the other 2/3 lease or finance) I thought he was trying to push me into considering leasing, but apparent that wasn't the case. He suggest that I stick to the credit union financing, if I could get it locked in until my new car arrives in a couple of months.

Do most BMW drivers really prefer leasing over financing? Have I been doing it wrong all these years?

Yes because there are typically two types of leasees. Those who like to mod and tune their cars, drive them into the ground and then turn them in so they can be someone else's problem and those who write off the monthly payment as a business expense and just keep on rotating through them. They also don't want to deal with post-warranty repairs. This isn't much different from Audi or Benz

[Janjohn]

Originally Posted by F32Fleet

Yes because there are typically two types of leasees. Those who like to mod and tune their cars, drive them into the ground and then turn them in so they can be someone else's problem and those who write off the monthly payment as a business expense and just keep on rotating through them. They also don't want to deal with post-warranty repairs. This isn't much different from Audi or Benz

For someone who doesn’t want to keep the BMW longer than the finance plan, leasing makes sense. Like most German automakers, BMW’s depreciate rapidly once the warranty runs out. As mentioned before, leasing is cheaper than financing, so it makes expensive vehicles more “affordable” and within reach to more buyers.

Being a Boomer, I always viewed renting/leasing as flushing money down the toilet. We’ve been buying our vehicles with cash or cash and trade-in for many years. Yes, we sank our money in homes, which generally appreciate, and vehicles which always depreciate. Yes, we lost money buying cars, trucks, and SUVs but I never worried about making payments other than insurance. We did buy and fix numerous used pieces of crap before we bought anything new.

Plus it’s quite a thrill to write a check for a new BMW.