JohnAMG

Thanks for the response. My other question is about the residual value. AT 57% value after 39 months, is that reasonable and correct? Thanks again.

John

ajf1

I spoke with one of my dealers today he will do $1500 off invoice for a new 2006 E55 for a straight sale or lease with the special money factor. If anybody is interested call me 404-822-5247.

Mr. Vanos

MB chooses to do a 39 month, rather than the more traditional 36 month...regardless, 39 mos for the E55 is where the deal is at. The average residual for a 36 month lease (not make specific) is ~49%, so at 57% it's pretty good for 39 months since you would expect a 39 mos term would have a LOWER residual than a 36. Obviously, the shorter the term, the higher the residual is going to be. While you can adjust the MF to create leasing incentives (or squeeze more money out of your customer), the residual is something that is set based on terms, including how many miles a year you opt for in your lease. In other words, a 36 mos lease w/ 10k miles/year will have a higher residual than a 36 mos lease w/ 15k miles/year. A 24 mos lease will have a much higher residual (as example, the BMW M5 has a whopping 71% residual on a 24 mos lease...too bad the MF SUCKS though!). Residual is important, and you need that data to figure out your payments, but you need to focus on the MF as that's one area where dealers try to get more out of you. Cars that have higher resale values tend to have higher residuals.

Mr. Vanos

Below invoice or MSRP? Below invoice would be roughly (depending on options) $7500-$8000 off MSRP, which is a great deal! Even better if that's the case off ANY car on the lot and not just that one Pewter car that nobody wants

Also, I googled your phone number...you seem to sell quite a bit of cars. Very slick but you got busted anyway. I will ask you nicely once: no commercial posts (or attempts at them) unless you are a paying sponsor

AWDman

my numbers
e55 no options- $84,275. lease price based on $80,000
10k @ yr, 39 mos
$2,500 due at signing
payment $1021 before tax
residual quoted at $47K

do this #s make sense?

if residual is indeed 57% for this special then my net is $31964? at 3% this = $861 per month? should I be lower than $1021 then even if the money down is $2k less?

the three favourable factors seem to be- higher than normal residual, being able to discount of msrp and the money factor. it seems the money factor if the least important in the equation.

thinking hard about this and appreciate any help. dealer will offer $28K for my c32 i just have to find tires to replace the snows on the stock rims.

by mid summer i expect starmarked 2003 e55s will hit mid -high $50Ks - i'm not sure if the lease deal works in my best interest. especially as the itch to mod kicks in after 2 yrs. i plan on keeping car awhile.

any help with verifying my numbers will be appreciated.

RJC

Please PM me a 39 mo lease quote based on the above info you stated. I am interested in an Iridium Silver car with the premium package. Apparently the special lease also includes the premium package as part of the deal.

Thanks

ntguru

AWDMan,

You are not correctly computing the finance charge portion of the lease.

I believe most lease payments consist of three major parts:

1) Depreciation - this is simple to compute - take the sales price minus the residual value divided by the number of months in the lease
2) Finance charge - the money factor (which is just a different way of computing interest rate) is multiplied by the *sales price* of the vehicle PLUS the residual value, not the depreciation amount and then divided by term. See below for further detail.
3) Sales tax - varies by state, but for a general estimate take step 1 plus step 2 and multiply by your sales tax rate

So for your example:

1) (80,000 - 47,000) / 39 = $846
2) (80,000 + 47,000) * 0.00125 = $159
3) ?

So $1000/mo is right on.

Put another way, if all other things are equal and you have two cars that both have say $30,000 depreciation over the lease term but car a costs twice as much as car B, the lease payment on car A will be substantially more--the depreciation charge portion will be the same, but the finance charge portion will be substantially higher.

ntguru

As you may know, money factor is computed by taking a standard interest rate and dividing by 2400 (regardless of term). So a .00125 money factor is a 3% rate.

So in the same example in my above post if you use an interest rate of 7% that increases the finance portion of the payment by more than $200 month to $371.

pas

That is exactly how it is computed, it takes about 2 minutes in Excel to make your own lease calculator, all you need are all the different pieces of the formula.

Total payment (to be redundant) is 1 + 2 + ((1+2)*tax rate)

regor60

if that is how it's done, so be it, but it doesn't make sense to charge interest on the car price and residual, it's double counting. The car value already includes the residual component. Like any loan, interest should be charged only on the outstanding balance, which is the car value less accumulated depreciation

ntguru

It's not a big difference, pas, but I believe sales tax is computed only off the depreciation portion (tax rate * 1), not off the depreciation plus finance portion (tax rate * (1+2)).

I have heard that some states have changed their sales tax laws regarding leases and that they now charge sales tax on the full amount of the vehicle purchase, not just the depreciation portion. That could significantly raise the sales tax (#3) portion. I haven't seen this myself so I can't confirm.

ntguru

regor60:

Yes, it does seem like double counting. I believe the principal is that lessor views the deal almost like two transactions. First, they are buying the car on your behalf. Second, they are contracting to let you borrow (lease) the car over the agreed upon term for an agreed upon amount of money from the lessee. Both of those events carry financial risk to the lessor, and in the first case they are "borrowing" money to buy the car and in the second case they are in effect loaning you money (use of the car resulting in the depreciation of their asset).

RJC

Don't forget, according to the MBUSA special lease offer; the $3650 premium package is included in the lease price of $999...so it's not actually a base car. $82,575 is the base price of the car but since MB is saying the premium package is included the car in question for the $999 is really a car that MSRP's @ $87,925 w/gas guzzler & dest.

The E55 AMG was designed with one purpose: to put you in an entirely different state of mind. With race-proven AMG performance credentials, the E55 AMG is truly a performance sedan unlike any other. Includes bonus Premium Package.◊
$999/mo. for 39 month lease10
$4,794 Total cash due at signing* Trim Package includes leather seat inserts w/MB tex, privacy glass, roof rails, Tele Aid. and HomeLink. Sunroof Package includes electric sunroof and rain-sensing wipers.

◊ Premium Package includes front active ventilated seats, left and right front drive-dynamic seats, COMAND DVD navigation, power rear-window sunshade, and 6-disc CD changer.



Special lease rates may not be reflected in lease calculator prices shown on MBUSA.com. Please see your dealer for final pricing.

ntguru

Sorry for the multiple posts here...but one more thing to consider:

In some states (Ohio included), if you *purchase* a new vehicle AND trade in a used vehicle IN THE SAME TRANSACTION, you only pay sales tax on the net difference between the sales price of the new vehicle and the trade-in price of the used vehicle.

Example:

You buy a $60,000 new car and trade in an old car for $45,000 (doesn't matter what you paid for that car, only what the dealer pays on trade-in), you would only owe sales tax on $15,000.

I live in Ohio so I can only speak for sure for this state. And it only applies to a *new* *purchase*, not a used purchase or a new lease. But it is something to consider when looking at trading in vs. selling privately if you are buying a new car.

abalto

This is an interesting thread. I was at the dealer a few weeks ago and they had a left over '05 E55 (no options) and they said I could have it for $68k. I really want a Silver car with Nav and Sunshade, and this one was black and had neither, so I did not seriously consider it. I have a C43 that I will be selling and it is silver and I really want silver again. I have a black 911 Turbo and one black car is enough for me. The are a total PITA *** to keep clean, unless you want to live for cleaning the car and I have a life otherwise. Question here is, if they would do this lease deal on a left over 2005 E55 this might be even more of a screaming deal. Anyone know if this is possible? I could always add NAV. The sunshade may be a little hearder to do.

I have never leased a car and I am very reluctant to do so. I would only consider doing so because I can lease it in my company name and write 100% of the payment off, where in a purchase you can only depriciate the car a small amount every year. After paying all the fees, plus GAP insurance, plus dealing with the lease termination, I don't think I would be willing to do the lease unless the "REAL NUMBERS" made it such an overwhelming bargain.

Are you guys considering the lease because it is just a cheaper "payment", or because it is really so much better of a deal in the long term?

abalto

Also, posting the XLS file with a lease calculator layout would be great for everyone!

blazinginder

My guy at the dealership here (the largest on the east coast)...has an 05 E55 in silver available for 10k under MSRP (76k 86k respectively) if anyone is interested, I think you'd be able to knock of a little more with some haggling

ajf1

lease deals only apply to new 2006 E55's

AWDman

thanks for all the input guys...very informative.

lease special still on.....until 5/01 i believe.

contemplating trading my c32 (paid off) towards lease of e55. minimal or no monthly payment......with intention to purchase at end of vehicles lease. bad idea? what are the pitfalls in this scenario? can i negotiate price or will the dealer have me by the ***** at that time?

i've "test fitted" a number of benzes and the e55 is the car for me....even more comfortable than the new S class. and the e55 with torque monster s/c motor and classic/ beautiful looks will appeal to me for many many yrs to come......would definitely get the extended 3 yr warranty so i'm good for 7 yrs to 100,000 miles.

the 28k offered on trade is generous (assuming it can stand alone and i'm not getting shafted elsewhere).

do it?

abalto

I just bought a new 2005 for $21,419 off of MSRP at an authorized Mercedes-Benz dealer. Brand new car with 175 miles. MSRP was $83,919 and I paid $62,500.00. Start calling dealers and seeing if they have any 2005 E55's left over. They can have the E63.

r_liebo

So is it confirmed as still ongoing? Link is not on the MB website. About to head out to the dealer to see if I can just have them pay off the remaining $6000k on my current leased c320, jump into the $999 a month with a couple options -- didn't want to get my hopes up yet until confirmed, however.

RJC

Yes, till 5/1/06

SoxFan

2005: $21K is very good. I have multiple quotes for $89,000-$90,000 MSRP 2005 E55s for $17,000+ off, so $21,419 is quite a number (wonder how they came up with that, as $17K is about the whole margin, holdback, and trunk money).

2006: But, now I am leaning towards leasing a new 2006. The best discount I've seen so far is in the $11-12K range, which seems like a pretty good deal, although they may come out with incentive cash in May/june when the E63s arrive.

Mr. Vanos

As an FYI, I was considering a W211 E55 so I called around. The best deal I got was about $4,000 below dealer INVOICE. Depending on options this translated to anywhere from $9,000-$11,000 below MSRP. Crazy good deals when combined with the special MF. Many dealers play dumb or just don't have a clue. As I said before if you EVER even considered this car, now's the time!

2K6E55

That's a very good deal... I picked up mine about 10 days ago and I got $8K off MSRP and did the MB lease... I am very happy with my purchase...