beartrap

My dealer has been working some options for a short term lease on an '09 E350. This is what he got back to me and I would like feedback from others. I think the numbers suck but wanted to see if others are getting better offers in the NYC area:

30 month term, 12k miles MSRP = $58,095. discounted to $51,350.
Monthly is $748 with $3700 down (taxes, fees, first month, etc)

I'm currently ending a 27 month lease 12/miles which is $625/month including tax! I think I might have put down about $2k cap cost when it started.

According to the dealer the residual values are killing these lease deals. He said its much worse for S, SL and CL's. Due to obvious market conditions MB beleives the car will be worth much less at the end so they are transfering the risk to the customer. Despite a very low money factor the monthly cost is still high. The discounts on the cars are OK and can probably be better, and if a loan rate is low it might be a good idea to buy the car, BUT the depreciation is so risky I doubt that would work either. So what ot do?

Anyone seeing better deals out there? I don't want a term longer than this as I expect to get into the new E class once it has some time to work out the new car kinks. I hate the idea of paying more that what I'm paying now when the car market is tanking, but I feel they got me by the ***** , or I'm not negotating hard enough. Any advice please share.

thx

MBNUT1

Sign and Drive 09 E3504matic MSRP $56975 0 down 10k miles/year 48 months $549 / month

beartrap

four years is way too long. I've had this same car for 26 months now. If this is the only way to get a lower price I'll find another car.

Untertürkheim

You should be able to get one much better equipped for that price.

Dema

What was sale price? I guess under $50,000. The deal looks good, however not for California.

beartrap

The purchase price for the lease is $51,350 which is discounted $6745 off sticker. Its probably a few hundred over invoice I would think. Options include P1, metalic paint and auto trunk opener which I don't need but is on this particular car. The sport package is a no charge option on the E350 without 4M. It cost $1500 with 4M. In the NY metro area, are there better deals out there, ie lower discounted price for setting the lease cost? The residuals are what they are set from MBUSA. Doubt they can modify that number. Not sure about the money factor but I beleive its very low, something like 0.9%. Appreciate any and all feedback/advice.

thx...

220S

fwiw, that's less a discount than I got back in the first week of October. And I didn't lease; there is even more money back to the dealer for a lease. I would press for more discount. Residuals are the tough thing now; BMW is reporting $25 billion tied up in low interest leases and an unknown market for used car resale prices down the road. Here's a good article on the current crisis in German auto industry, btw: http://www.spiegel.de/international/...592658,00.html

IMHO, if you can swing it you should get a car better optioned (P2; leather, etc.) since you'll get good discounts on those nice extras too, in this buyer's market (unlike in the past when everyone had to pay top dollar.) And a probable better/faster resale later (if you buy it) as there will be a million 'standard' MY09 E350s for sale in due time.

LaicepsYdobon

Walk away from it Bear... On the MB site the Winter Event price for a 4matic E-Class is $619 (P1 package). $748 is way too high.

beartrap

you are correct BUT that is for 36 months with a cap cost reduction of $3750 which when added to the monthly payment it becomes $723/month, plus tax! Its also 10k miles/year. The purchase price for setting that lease is $52,073. The deal my guy has offered had a lower discounted price ($51,350) and was for 12k miles and for 30 months. For a 36 month deal, which is more than I want, my dealer offered $712 w/o any cap cost reduction using a money rate of 1.37% and a residual of 47%. I can't even recall a new MB ever having a residual that low! With a $500 cap cost reduction the price went to $698. Both are still better than what the web site is promoting, but not what I am looking for. Buying these cars now is risky unless you get a great deal AND keep it for 4-5 years as they will depreciate very fast.

My main concern is am I getting enough of a discount on the car to lower the monthly price? The residuals are in the tank and are set by the finance guys, so its out of the dealer's hands. The money factor is stupid low which helps (.026%). The only way to get a lower monthly payment is to discount the car more. Not sure how much more there is to go, but I plan to shop around at some other dealers this coming weekend and find out. I will let everyone know. Appreciate the feedback and comments. Keep them coming.

Dema

I got a similar deal and consider it good.Sure, if you can wait, then you can get even better. Does the car have leather?

beartrap

thanks for the reply. The car does not have leather. It has P1, metalic paint and the stupid electronic trunk closer ($540) which I don't need. I beleive the sports package comes std with the E350 which is a $1500 option for 4Matic cars. I would prefer P2 and leather, but the more expensive the car the higher the monthly lease cost, esecpailly with the rediculously low residual values, around 50% for a 30 month lease.

I'm not sure waiting is going to make the deals substantially better. MB is likely to cut production of all their cars as global demand has slowed, and the current E model is going to get phased out with the new replacement due in the fall. Perhaps by the summer any leftover '09's might get blown out, but that's too far out for me as my car is due back in January. MB allows you to keep the car on lease for three more months but the payment goes up by $200/month. I might opt for this and see what happens come April, but I doubt the residuals will improve by then, and the money factor is already close to zero. So, what to do???

The GLK350 is coming so I will take a look at this next week to see if it is a viable replacement for the E on a 27-30 month lease. My dealer worked up some numbers on a fully loaded GLK using the C350 lease values and the monthly cost was still relatively high for a $46k car.

Its strange. You would think there would be some real stupid deals out there but I'm not seeing them for new car leases. If you want to buy and own certain models I'm sure there are great deals, but you run the real risk of them depreciating faster than ever, even with a large discount up front. Perhaps the best/safest solution is to buy a pre-owned model. The residual values have been crushed so the risk has shifted to the guy leasing the car rather than the manufacturer. BMW is in deep trouble with this problem way more than MB as they have more than double the exposure of leased cars on their books than MB and will have real challenges trying to recover the cost when those cars get returned. In this economy, this is their version of toxic assets I guess!

220S

Good luck with your decisions. If you are renting a car, it's becoming a different issue these days, and I think will be from now on (I'm assuming you read the recent Der Spiegel article I posted.) Cheap and easy car leasing seems to be on the way out.

I bought mine because I tend to keep cars for a long time and add on the miles. My 993 C2S is now almost 12 years old. So, I went after the best cash deal I could find, and a car optioned to live with for the coming years. I got the E350 as a car for trips, convenience, etc.. I don't plan to buy again for a long while.

Yeah, leasing will be different now. Several months ago at a corporate meeting, BMW talked about cutting back on production and using a model of selling cars only as they are ordered by the dealer (no more buy off the lot!) I'll see if I can find that reference and post it. MB, of course, is cutting way back on production, too.

Leasing has put so many cars in circulation.

btw, that electronic trunk close might seem extravagant but it's actually a very useful option. Mine came with it (I wouldn't have thought to order it) but it's extremely handy 90% of the time. The other day we had our first real rain of the year, and my hands were full of the grocery bags that I had in the trunk, and presto...

K-A

It seems right now the smartest buying move is to buy a 2-3 year old car, as they've depreciated at a faster rate then ever.

I gotta say I'm personally pretty happy that Leasing is gonna be harder. I've always bought what I can very comfortably afford, while knowing I could have leased a much more expensive car and kept my cash in the Bank. I guess I just see it as more responsible, especially considering so many people who Lease these high end cars really could never afford to buy one (AKA no money in the Bank). This doesn't speak for everyone of course, as Leasing is a much smarter financial move for most, but it looks like the Manufacturers have finally realized that the joke is on them....

beartrap

I agree that the days of leasing expensive cars is coming to an end, and so is the spectacular sales growth many car companies enjoyed over the last several years. (see BMW & Porsche) Its kind of like the housing business, its going to take some time to burn off the glut of new low mileage used cars that are coming on the market after leases expire to then possibly drive residual values up again. The days of higher than realistic residual values are over and so are the low payments to rent these expensive cars. The way to get through this is likely to go back to the days of buying and keeping a well made car for 4-5 years. If auto loans can remain affordable and maintenance low, than this shift is possible and likely to happen. MB's will continue to fit that profile and over time their values will stabalize I think.

Some personal examples: I traded in an '02 911 cab back in July 2006 for a new SL550 that I own outright. The market value of this car has tanked, but I don't really care becuase I enjoy it and intend to keep it for many years. I purchased my daughter an '08 C300 in August which she will keep for 4-5 years through college and then perhaps give it to my son when he goes off to school and she gets something else. My thought was to buy a good solid, safe and reliable car and let the kids drive it for 7-8 years or as long as they can. Kind of like one year of tuition stretched out over 6-8 years. That's the plan so we'll see if it works out.

I also leased a couple of cars because they were cost effective and I know its been my patern to move into something else after about 3 years. I certainly want to get good value and a good deal for my lease dollar like anyone else, but prices now seem to be more unrealistic. As for my situation and what I use my E350 for, I will likely look to get a low mileage '07 for around $30k, put some money down and finance the rest to buy time till the new E is out for a year or so. The irony is that I currently drive this exact car BUT MB Finance refuses to give me a deal I can live with when the lease ends in Jan. No way am I going to pay $41k for my car with 22k miles when I can find the exact same car or even an '08 with less miles for 7-10k LESS! Crazy stupid...

Good luck everyone and thanks for sharing your thoughts and opinions. I certainly have welcomed them and encourage more.

Dema

Lease is still only way to afford a good car for many people.
Even 0% finance makes my payment $1000 for 5 years. And if I choose this way, then my new car will hardly cost $8K after 5 years. Consider that I can think that my monthly payments were $850. However even at worst lease deal I pay only $700, and get a new car every 2-3 years.
If you get other scenario as pay cash and change car every 1-2 years, you still will lose something comparable to lease payments.
Can somebody show that my calculations wrong? I am considering 0% financing for new Jaguar XF.

Greg_S

beartrap - I was in the same position as you and since the car was for my wife and she likes new cars, I ended up purchasing a 08 550 at a substantial discount. If it was for me, I would have bought a used 08 and saved a ton.

Dema - there is no financial sense to buying this level of luxury car. If you change cars every 2 years, lease is the only way to go. If you want the Jag, get it. Its a beautiful car.

LaicepsYdobon

Bear, my sales guy got back to me. It's tough out there but this is what he can bring to the table for you:

E350 with P1 and sports package (sports package is $1,500 but you can have it for free). 27 month lease with 12,000 miles per year will cost you $729 a month (this includes tax) with $3,887 due at signing. The car is valued at $58,275 and the cap cost reduction is $0.

Dema

It doesn't look like a good deal. I have 09 with P2, folding seats and pay a little less. P1 has no any worth, and you can get 08 leftover with P1 for really cheap.

LaicepsYdobon

Paying less for a P2 ? Damn; I gotta get my next car from your dealership

beartrap

here is the latest deal my dealer offered me today on an '09 E350 w/P1:

39 months 12k miles $563/mo $3535 cod (tax, 1st payment and bank fee)
39 months 12k $616/mo $1710 cod (tax in payment)
39 months 12k $638/mo $865 cod (everything in payment just 1st payment and dmv)

I think I'm going to role the dice and get one and hope they can get me out early and into the new E. The price is right, esecpailly without no cap cost reduction.

Comments?

mhj202

Beartrap-

Did you end up taking the deal? Seems like it was a really good deal (given the current residuals). I had a deal that was similar or maybe even a little bit better but that was at the end of November and at the time I wasn't in a position to take it.

Just leased a 2009 E350 4Matic with P1 and Sport - and I was not able to get near the deal you have listed above even though I had shopped a few different dealers in the NY metro area. Wish I had found this forum earlier- but at least I really like the car.

My search seemed to turn up that the E350 deals were actually slightly worse in December than they were in November but that doesn't explain your deal. The sale price must've been more than $10k below sticker.

If you wouldn't mind, would you PM me the name of the dealer?

Thanks

Viper786

I was offered 533 for 39 months on an 09 E350 4matic w/ premium 1, sport package, bluetooth w/ 1500 down if i turn in my current lease (07 e350 4matic for which im paying 660)

BobbyT

I can confirm that the lease residual values are what is killing leases. The residual on my 2006 E350 was 63 percent, on the 2009 it is 47 percent, a huge difference.

Dema

Cool, E350 is going for similar lease payment as ES350.

beartrap

I should be getting my new '09 E350 this week. I'm getting a very good special deal on this car because I've gotten 4-5 cars from them over the last several years. They don't discount too many cars this much, but its kind of like an employee discount program. That being said, the residual values are killing all leases. My deal is highly discounted, probably something like 12k with almost no interest rate. Payment for 39 months is under $580/month with 10k miles. No cap cost reduction, just sales tax, fees and first payment upfront. I went with a RWD model as I could no longer stand the 5-spd trany anymore and the 7G in this car makes it much more enjoyable to drive. If bad weather hits and I need to drive I'll take my wife's GL. I'm also getting P2 and the Pano roof on a white car. The sports package comes std no charge on the RWD models, $1500 extra for the 4M's. After seeing pics of the new W212 I'm kind of pleased that I will be in this car for another 39 months. Maybe by then they will make it look better than what it does so far.