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Lease Polestar 2 or finance?

  • Lease

    Votes: 10 76.9%
  • Finance

    Votes: 2 15.4%
  • Pay cash

    Votes: 1 7.7%

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Discussion Starter #1 (Edited)
Are you going to lease or finance your Polestar 2? Any reasons why I should consider one or the other?

I'm in the US and it's easier to get the full federal tax credit here through leasing, so I'm probably going to lease, but not if the money factor is too high and/or the quoted residual value is too low.

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Polestar is quoting $649 per month for lease...but does anyone know money factor and residual value for the lease?
 

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This is a good question.. can you in a nutshell explain this 'Money Factor'?

Im familiar with Residual.. How do they relate?
 

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Discussion Starter #3 (Edited)
This is a good question.. can you in a nutshell explain this 'Money Factor'?

Im familiar with Residual.. How do they relate?
For leases in the US, “money factor” is the interest rate. The residual value is the leasing company’s estimate of the value of the car at the end of the lease term.

In a US lease, you take the sales price minus the residual value. That difference is the cost of the lease. That difference represents exactly how much value the vehicle loses over the lease term. That’s why some people view leasing as renting a car — you only pay for how much value the vehicle loses. You divide that difference by the number of months in the lease to calculate the base monthly payment. Then add interest rate (“money factor”) and taxes.

In the US, dealers will disclose the residual value but they try not to disclose the money factor because it is legal here for the dealer to increase the money factor without disclosing this to you and the dealer gets to pocket the difference in the interest rate. Increasing the money factor and keeping the increase is a legal practice for cars but illegal for real estate. So when you negotiate a lease deal, you have to press strongly for the dealer to disclose the money factor and whether they are padding profit there.
 

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more details comparing the lease and finance deals for these models:

For comparison, you can lease a Tesla Model 3 for an estimated $371 per month for 36 months with $4,500 down. It covers 10,000 miles per year. This is for the Model 3 Standard Range Plus, which carries a starting price of $37,990. You can find this information on Tesla's website.


The Polestar 2 costs over $20,000 more ($59,990). To lease it, you'll pay an estimated $649 per month for 36 months with $4,000 down, and you'll get 10,000 miles per year.

For comparison, if you were to choose the most expensive Model 3 Performance ($54,990), the 10,000-mile lease comes in at $620 per month, with $4,500 due at signing.

If you'd rather finance, Polestar, like many other automakers, is currently offering 0% for 60 months. Tesla's current rate is 2.49%.


 

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The big unknown is the residual value of the car in 2 or 3 years when the lease ends, which has a big influence on the monthly cost. It's a new model, and there are a lot of new EV's coming along, balanced against a move away from fossil fuels to electric, etc.
Throw in Covid, and..... who knows?!
 

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A big factor in the UK is company car benefit-in-kind (BIK) taxes on the user of the vehicle. I have my own business but since 1998 have personally purchased cars and charged back to my company for useage at the official HMRC (our IRS) rate per mile. As of this year, BIK taxes on BEVs have been slashed from 16% to 0%, rising to 2% over the next three years. Plus a business can reclaim 50% of another tax (VAT) on a vehicle lease. This is all government policy to encourage BEV take-up by fleet managers who buy a lot of cars in the UK. So my Polestar will be leased by my business, a big change for me but an added benefit to BEV 'ownership'.
 

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I really want to lease because of the fast-developing technologies behind EVs, namely, the main traction battery. This car is not using any of the advance solid-state batteries. It's also a heavy car. If, say in three years time, there's an updated Polestar 2.1 with lighter, denser, safer, longer-range battery, I'd hate having locked in the entire cost of purchase. This is the leasing mentality. It's especially valid for EVs.

But on the other hand, the current lease terms are stiff! $671/month with $4,500 down on 36mo/10k? No room for haggling if I have excellent credit? No special deals during seasonal sell-offs?

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I really want to lease because of the fast-developing technologies behind EVs, namely, the main traction battery. This car is not using any of the advance solid-state batteries. It's also a heavy car. If, say in three years time, there's an updated Polestar 2.1 with lighter, denser, safer, longer-range battery, I'd hate having locked in the entire cost of purchase. This is the leasing mentality. It's especially valid for EVs.
That was my thinking - in 2 - 3 years batteries could last longer and be faster charging - hence 'early generation' EV's are slightly risky. Hence at the moment I'm thinking lease.
 

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I’m upgrading from a Chevy Bolt EV (Premier trim). The lease was negotiated to $232/mo with $3400 down for 36mo/10k terms, based off of $43k retail.

This Polestar 2 is definitely not even double the retail value, but they want triple the monthly? Ouch.
 

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Surely the cost of the lease over your selected term takes that into account -
They will estimate the residual value of your car given factors such as battery improvements, and be pretty pessimistic too. They allows them to calculate the cost to them over the term, and therefore what they need to charge you.
The advantage of lease is you don't need to arrange finance or fund the purchase cost from day 1, plus you don't have the hassle of selling it on yourself at the end. The disadvantage is you are locked in for your chosen term.
 

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Has anyone with a US 'confirmed' order been able to make heads or tails of the leasing info on the confirmation page? The financing calculator seems about right. But, I think there must be a bug or two (or 3...5...22...) in the leasing calculator. They're either adding in a bunch more fees or double/triple counting something.

I'm in CA and getting Midnight car with leather interior and no other add-on/Pack - total cost with destination charge ($1300?? really???) comes to $66.400.
The before confirmed page lists a $715 monthly payment with $4500 down, for a 36 month lease, 10k/year rates (the defaults). Based on my understanding of the tax rates, etc I'm assuming ~$50/month added for taxes, fees, etc. Yet on the final page they say $7.2k due on signing (+$2700 above the $4500 down) and the monthly lease is like $793 (+$80/mo). Does not compute.



I’m upgrading from a Chevy Bolt EV (Premier trim). The lease was negotiated to $232/mo with $3400 down for 36mo/10k terms, based off of $43k retail.

This Polestar 2 is definitely not even double the retail value, but they want triple the monthly? Ouch.
This seems like an insanely good deal. To make this happen, using online calculators, I would have to zero out taxes, fees, etc and assume a 72-73% residual value. Good on you for getting them to agree to that! Don't know that that can be reasonably expected to happen across the board, especially for a new car model that seems to have limited supply and ample demand.

As another data point for the TM3, it seems they're assuming a residual value in the mid-60s %. I think that's the most that could be reasonably expected.
 

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...(snip)...
This seems like an insanely good deal...
This Polestar finance/ purchase/ lease experience becomes quite oppressive, IMO.

Customers with really good credit and negotiating skills cannot get awesome deals.

Is Polestar offering good deals for everybody? No chance! There's no reason to trim off fat from any portion of pricing. No price competition. No incentive to match any price. Extra excuse that it's a new model (practically new company).

One fixed price for everybody means one high price for everybody. It might help the weak customer who don't like haggling. And that's the sales pitch. Don't worry about it. But with everybody paying more, everybody don't have to worry about it. With tidy hidden profits, they can easily placate confused customers so everybody gets very happy.

It's ultimately the worst of socialism.
 

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This Polestar finance/ purchase/ lease experience becomes quite oppressive, IMO.

Customers with really good credit and negotiating skills cannot get awesome deals.

Is Polestar offering good deals for everybody? No chance! There's no reason to trim off fat from any portion of pricing. No price competition. No incentive to match any price. Extra excuse that it's a new model (practically new company).

One fixed price for everybody means one high price for everybody. It might help the weak customer who don't like haggling. And that's the sales pitch. Don't worry about it. But with everybody paying more, everybody don't have to worry about it. With tidy hidden profits, they can easily placate confused customers so everybody gets very happy.

It's ultimately the worst of socialism.
Agreed. But this is the Tesla model. One price, non-negotiable.

except Polestar clearly has bugs in their online calculators — which doesn’t inspire a lot of confidence in a company putting out a product that requires a lot of coding prowess.
 

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Agreed. But this is the Tesla model. One price, non-negotiable.

except Polestar clearly has bugs in their online calculators — which doesn’t inspire a lot of confidence in a company putting out a product that requires a lot of coding prowess.
Once the bugs are fixed, it's the Polestar model, too — a non-negotiable oppression.

It's the same oppression that those silly Saturn cars had. I'm no cheerleader of car dealerships, but there are huge advantages in price competition. That's how I got my insanely good deal on the Chevy Bolt.

By the way, I'm not arguing with you or disputing any of your claims or picking on any of your words. I'm just adding commentary to this discussion topic.
 

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In the UK it is the same for both Tesla and Polestar. Basically, this is the price, take it or leave it. No dealers to haggle with to get a better deal.
 

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Yeah, both horrible oppressive pricing — Polestar and Tesla. It reminds me the other reason why I never cared about Tesla. The primary reason was lack of tactile controls. Then the swoopy feminine styling wore thin after a few years of no improvement, not even brighter safer tail lamps. But I don’t want to veer off into Tesla-bashing in this discussion.

It’s sad that such annoying socialist pricing is catching on with new car makers. It’s truly one of the worst tactics in Tesla to copy. And again, I’m not completely anti-socialist like some extreme conservative. It’s really just higher monopolistic pricing for customer. It shuts out any potential savings. Final price gets bloated.

The only way to have faith is to believe that we’re all helping a new EV maker stay in business. But then, this model is middle-class. We’re not talking Polestar 1 or original Tesla Roadster. Even the Tesla model S was sort of suckling on pockets of the wealthy (for support). This Polestar2 is mass market. It becomes a compulsory faith at best, this form of helping Geely stay in the EV business.
 

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Right now ther is quite a lot of anti-China sentiment in the UK (and US!) with their Huawei comms kit and also their aggressive foreign policy and internal human rights issues. I hope these do not escalate and have a negative impact on the acceptance of Polestar.
 

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Right now ther is quite a lot of anti-China sentiment in the UK (and US!) with their Huawei comms kit and also their aggressive foreign policy and internal human rights issues. I hope these do not escalate and have a negative impact on the acceptance of Polestar.
Hopefully the fact that Geely own Lotus and the London Taxi Company/London EV Company - will help dissipate that - and I think they'll play up the Swedishness of the Polestar brand.

Let's face it - the Chinese also own MG, and probably build most MAC's and iPhones.
 

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The political sentiments about China are understandable but silly and rather irrelevant in this Polestar2.

Robert Llewellyn, in his emotional adolescent love crush of a review of the P2 [link], almost said it — that the superior product itself should be the main buying influence. Not politics.

And I agree. Like that fella, I also love everything (else) about the P2. I’m still holding back opinion on the driving mode-systems until I take it out on the road myself, as no review yet has touched upon how it manages the daily actions of strong regen in one-pedal mode. Specifically, this P2 seems to lack the convenience of a physical toggle switch between high and low regen like the Chevy Bolt with its palm shifter. There’s only the touchscreen setting to start the day. No extra paddle at steering wheel either. This is the other discussion [link].

But the money process sucks big time. Sure I appreciate the price point to match Tesla’s 3. Also, I didn’t forget that they had squeezed the basic price to below the threshold to qualify for gov’t incentives.

This is why the fat leasing deal is annoying. Hopefully, it’s only under-developed at this stage, that more competitive options and leasing programs will be available when Polestar Spaces open up.

Right now, the zero interest “loan” is the best deal. But again, I’d suspect some small fat fees to sneak in.

Only thing is that full purchase is not quite right. Not yet, IMO. Before my first EV (Chevy Bolt), I had purchased vehicles outright and kept them for decades until their repair costs outweighed their daily worth. Now with rapid developing technologies in EVs, the ownership method flips to leasing. It may not be repair costs but support costs that shoot up suddenly. Financial sense absolutely has to match the relevance of the technologies. It’s more like computer advancements. Today’s batteries, for example, could be sad heavy monsters in just a few years.

But then, maybe huge market demands for this wonderful P2 will make this all a moot point.
 
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