farrbar

I don't think the depreciation on these cars is out of line. However, I think that DCX is unrealistic about what the cars will be worth several years out. This creates a great chance to lease. The residual quoted by DCX is a % of MSRP, but you should never pay MSRP. So, on my '06 that I bought a year ago with a sticker of $57K DCX thinks it will be worth $37K in 39 months (i.e. 65% of MSRP), in fact the negotiated purchase price in my deal was $48,000 thanks to trunk money and dealer concession. Thus, in my lease I am really paying interest (rate was pretty good at the time) and $11,000 in depreceiation. I would be willing to be that almost every $48,000 car will experience $11K in depreciation over a 3 year period.

While I am typically against leasing, as I believe if you can't pay cash - don't buy it, this was just too good to pass up. So in the mean time I have my cash getting 4.99% in a mmkt (interest in lease is only 5.15%) and I know my depreciation is limited to $11K over 39 months. Unless MB Credit wants to significantly negotiate the residual it is highly unlikely that I would buy this car at the end of my lease.

bm75204

I agree...artificially high residuals and low money factors can make leasing a really great deal. I always lease since I'm self-employed and the tax benefits are far greater if I lease...buying would be foolish for me, plus I only keep cars 2 years (if even that) and have found some good 24-27 month lease deals on past cars. Plus there's no way my car will be worth the residual when the lease is up. A friend of mine just bought a very clean and loaded 2003 E320 w/40K for $25K, so I like knowing that I can turn my car in at the end of the lease and not worry what the private-party market will bear at that time or how badly a dealer will try to hose me on trade-in.

bm75204

Excellent point. I always do $0 down leases and take the higher payment, as I can write off most of the increase in the payment (vs. a lease with a down payment) and keep that down payment money in investments or money market savings. It's the smart thing to do unless you don't have the discipline to keep from spending the down payment money or can't handle the larger payment over the long term.

Just a side note for everyone considering a lease who doesn't need a brand-new vehicle, check out www.swapalease.com and www.leasetrader.com. You'll often find deals on cars where people put down a lot of money to get a lower payment, then have to get out of their leases for various reasons and often allow you to take it over without giving anything down. Sometimes people won't do a takeover without a down payment...it depends on the situation. But I got a BMW X5 for $287/month for 12 months (NO down payment, just a $450 BMWFS transfer fee) from a guy who put down $7000 on his lease to get the payment that low, so there are some real steals out there if you look hard enough and luck is on your side.

allenjdmb

any other particular system in the car that has killed resale. It is very simple--DCX/MBUSA has put TOO MUCH PRODUCT in the US system. There are too many cars, not enough demand, and very little profit left in the process. Oh, except for....Yeah, MBUSA! So while they force product down the dealer's throat, their profit continues to build, while customer's resale and perceived satisfaction falls. No, this isn't going to fix itself at the end of these leases, nor anytime soon, unless they are smart enough to limit production and increase perceived value and desirability. And if you think ANY current Benz is put together like an old one, you haven't owned very many late model ones. I know this thread is old, but just saw this and couldn't pass....

JWS3

greedy German unions (I like the E550, but 68K list for a well equipped version is totally outrageous) require dealers to lower their prices to meet market realities, while the increasing omission of what should be standard like HID lights and scheduled maintenance makes things even worse. Really, who ever heard of a 50-100K car w// HID lights as a freakin' OPTION, and an expensive one at that??

One more important factor; reliability and cost of service. Fewer people are willing to pay big $$ for a car that will invariably require even more budget breaking $$ to repair & maintain. Yes, I said the word "budget". Even MB owners have a limit. Besides, who wants to buy a used E at full price when it'll likely need many thousands of $$ to keepp running when the myriad of toys invariably start to fail. The parts, etc are horrifically overpriced.

The cars are selling a what the

Barry45RPM

It aint "percieved value & desireability".

sklasse

I Really Don't see the point of these REBATE ..

THe e-class sales are already through the Roof, kicking all the 5 series butt... up 26 % in November goto fred melons website for current sales...5 series only up 13-14% percent, i m sure the 07 increase WILL be higher..

With sales this strong, IT doesn't need rebates..

Alan Smithee

As I mentioned in post #5 of this thread, they're probably pushing the E-class hard to make up for weak current C-class sales in its last model year.

nantucketsleigh

Having seen my 2006 E500 (loaded, 7000mi) depreciate $20-25k in retail/trade-in value and a friends Acura RL depreciate over 20% in the first year because of big manufacturer incentives, I will make a real effort to not buy another MB without money in the trunk. The MSRP on a new Mercedes is about as valid as the MSRP on domestic cars. I am car nut but I hate feeling like a fool. I will have a hard time paying above so called dealer cost on any new Mercedes.

OceanView

Are the deals still active?
Does anyone know when these lease deals end?

Frank Wiesmann

It's not just the labor unions. I talked to a few people that work for companies that produce parts for various manufacturers some time ago. They said that, after Ford, Mercedes was one of the pushiest customers when it came to making the parts cost less. The guideline was "How cheap can you make the part" instead of "How reliable can you make the part". In contrast, the Japanese stand behind the engineers and watch their back every step of the way. This and the fact that many of the cars are sold or leased to companies that only run them for the 39 months (ie. in warranty) lead to the current situation of many companies, not just DC, caring more about their shareholders than the customers as such.