Vivek

Hi,

I have been driving E Class for last 6 years and currently on my second car. The lease for 2010 E350 is expiring in February and I need suggestions. The car is only about 43,000 kms and in top condition. I don't mind keeping the current car but am asking for suggestions from experts on this forum.

Option 1: Extend the lease of the current car (lease $1,350/month) for 2 years at the end of which I have an option to purchase ($13,000) or return the car. If I return the car after another 2 years, will it make much sense to go for another E-Class which will be coming out with completely new model in 2016-2017? To me,this will only make sense if I want to purchase and keep the car after the lease expiry.

Option 2: Return the current car and wait to get 2014 E-Class. I can extend the lease of current car for 6 months while I wait for 2014 to come out. Or put a factory order (without knowing the pricing, interest rates, options) and extend the lease for up to 6 months and return the car as soon as 2014 E350 is delivered. I could also purchase the car now and sell it privately when 2014 is delivered as it will put some money in my pocket, about $10K expected.

Option 3: Return the car and get 2013 S550. As this is an outgoing model, it includes all possible packages (well, almost, except rear seat package) for about $1,700 financing for 6 years or 3 year lease at $1,800. S550 is being offered at great interest rate and discount. I will be happy to drive an S-Class but not too happy with increase in payments. Also, does the 2013 S550 has better technology than 2014 E350 to justify paying extra towards it (ignoring the engine and size differences). Monthly payments for 2014 E350 is expected to be around $1,400.

Any other questions/suggestions that I may not have thought of. Please help.

Thanks
Vivek

BM2BZ

i'd go for option 2, especially you are not too keen with the extra payment on the s class. get a 2016/2017, new body style, after the two-year lease end.

ImInPA

I would consider option 3 if you were talking about the S350 Bluetec. That is an amazing vehicle.

golfster

Of those options, the two I wouldn't consider is 1 and 3. Unless I'm missing something, the current car is already 3 model years old now, and the option of extending for two years at a rate of $1,350 per month = $32,400 + another $13,500 to buy it at that point for a total of $45,400 doesn't equate to a good option.

Option #3 doesn't appear good either. Financing a car, especially an outgoing model, for 6 years is a long commitment I wouldn't consider, and at $1,700 per month totalling $122,000, I suspect you are putting some cash down as well. But if you want to replace this car before payoff, it would likely be awhile before you were at an even balance of owed versus depreciated value, locking you in for awhile or requiring more out of pocket cash until you are at positve equity. Leasing the same car for $1,800 x 36 payments for a total of $64,800, plus any deposits, if required, is approaching the purchase price of other cars, although not S's.

Some form of option 2 looks best from my perspective. Perhaps buy out the current car now, and just wait until the 2014's are available.

Vivek

Thank you for the wonderful comments so far.

Just an information, all of the numbers I have given are with 0 down.

Arrie

How much would you need to pay to purchase the car now when the original lease is up?

Vivek

To purchase my current car at the end of the lease in February is about $42,000. The price of the new 2014 E350 is expected to be around $83,000. These include taxes and are Canadian prices.

Arrie

So, as mentioned in an earlier post extending your lease by two years and then buying the car would cost you $45400. Now you can buy it for $3400 less.

What I would do, as I understand you want to stay with MB, is I would either get in a new 2013 model year car at the end of the lease or if you want to wait for the 2014 models (ugly in my opinion but don't let this affect you...he..he...) purchase the car now at the end of the lease.

Purchasing it will give you the freedom to do what ever you want to do with it later on when you want to do it.

ddeliber

Well, not exactly, tax and interest are already factored in the lease payments (right?). I don't know the sales tax in your area but at 7% that's $3k and the interest will depend on the financing you get.

Having said this, IMO you should never extend your lease by more than a couple months at the same payments as the original lease. When you lease you are just paying the expected depreciation. This is the highest in the first 2-3 yrs. After year 3 the value of the car decreases much slower. After 5 years you would have paid $81k which is essentially the price of the car and still need to buy it out with another $13k. The savings you get from extending your lease is in the buy out price at the end - as you can tell a 5 yr old E350 is worth a lot more than $13k. In MA 2008 e350s are going for betweek $18 and $30k, and I am sure they are going for a lot more in Canada. So you'll be able to get back some of what you put in to it, but how much you get back is a risk that you will have to take. Plus they are holding your money which defeats the purpose of a lease in the first place. Then you'll have to buy it, and then sell it (assuming a trade won't work).

I believe that the value of a lease is that you only pay for what you use - less out of pocket -, you don't owe more than the car is worth, and the risk for the value at the end is on the leasing company (if it is worth less you give it back, if it is worth more you sell it pay them off and pocket the difference).

If you are considering extending the current lease, you would be better off adding the 4th option Arrie suggested: leasing a new 2013 for 1 or two years. Your payments will be about the same (a little more of course), you drive a newer car with more power and better gas mileage, and you can still get a 2014 when it is done.

Personally, I would buy the 2010 (depending on what 2010s are going for in your area of course) and trade it in on the 2014 (or sell it) since that is what you are looking for. Financially speaking it is probably your best bet.

Vivek

The sales tax where I live is 13% and I have included it in all the numbers I mentioned.

BTW, when is the next gen E-Class expected to be out? Is it 2016 or 2017?

2013 is not available for 1 yr lease, minimum is 2 years. I am not very particular in getting the 2014 and am debating if I buy the 2010, should I trade it for 2014 or wait for next gen to come out.

Arrie

As you say you are not a big 2014 model fan then either buy the current car and keep it or return it and make a full lease (or buy) a new 2013 model.

A 3-year lease on a 2013 takes you to 2016 and then if there is a completely new model coming out you can go with that at the end of the lease.

But if there is such thing coming out I have no idea.

BM2BZ

i think the next gen is 2017 and s/b out in 2016. so return your current car and lease a 2013, 3 years. perfect timing .

Ajax Lesser

Option 4.

Let the lease expire. Rent a SmartCar (http://www.smartusa.com/models/pure-coupe/overview.aspx) for $99/month. Wait until the 2014 E-Class comes out later this year.

alsyli

Uh, except that the OP has made it clear multiple times that he/she's in Canada.... And except that, from what I've read (since I have no interest in test driving one myself), the Smart is a piece of crap (size issues aside, teh car doesn't even get particularly good gas mileage....).

Ajax Lesser

Just thinking outside of the box

cdigiovanni

the new CLS550 is amazing!

todd's benz

I got my 2013 E350 for $610/month 24 months with 39,999 miles.
I saw benz commercial today for E350 for $575.

todd's benz

I got my 2013 E350 for $610/month 24 months with 39,999 miles.
I saw benz commercial today for E350 for $575.

Cyber GS

That's interesting, do you recall what the out of pocket was and the length of the lease? Thanks.

todd's benz

this is probably the commercial I saw http://www.mbusa.com/mercedes/special_offers/current

I can look up my info and send it over email if you like

Cyber GS

I appreciate it but it's not necessary, I can look it up, but thanks for the offer.

Michael Khan

i would go with option 3, or you can get the new 2014 new e63 amg 4 magic.
Personally i would go with e63 amg 4 matic