New e-Golf for less than $10k? What the hell am I missing?

[Farfle]

From these dealers:

2015 Limited edition for $20k ($15k off MSRP)
or
2016 SE edition for $18k ($12k off MSRP)

Then the Fed credit of $7500 and Cali $2500, less than $10k for a NEW Golf? Can one who lives in Cali buy from one of these dealers and ship it back?

I don't have the tax income to take advantage of that, but I ran across this when reviewing other cars and it seems way too good to be true right?

 

[Sptgolf]

I have noticed some local California dealers now advertising the price "after" the Federal tax credit. You may want to check on their advertised price to see if it's baked in already. If not, that's a heck of a deal.

 

[forbin404]

The fine print in large

New vehicle prices, discounts, savings and other special offers may include some or all manufacturer incentives, which are assigned to the dealer. Maximum manufacturer incentives and discounts may not be available to all buyers or may require financing or leasing with a specific lender. Financing, leasing and down payment offers are available to qualified buyers, not all buyers will qualify, may be in lieu of other manufacturer incentives and are subject to change by the lender. APR means annual savings or other special offers, are not valid on prior purchases, advertised pricing is valid on in-stock vehicles and may expire on a specific date noted with that discount, savings or other special offer. Additional limitations and requirements may apply to percentage rate. In most cases discounts, savings and other special offers cannot be combined with other discounts, apply and be noted with some vehicles, prices, discounts, savings and other special offers. Tax, title, registration, bank acquisition (if applicable) and dealer document preparation fees are extra. Service and parts prices, discounts, savings and other special offers are plus tax and shop supplies where applicable. All prices, discounts, savings and other special offers are subject to change. Vehicle illustrations and videos are for design purposes, actual vehicles may have different equipment or look different. Vehicle equipment listed may be incomplete. Differences in MSRP for what appear to be similarly equipped vehicles may be due to additional manufacturer installed equipment or limited time manufacturer "value packages" not listed. MSRP does not include dealer installed equipment, if applicable.


Aka, NOT a fixed price, and probably includes all rebates including the 2.5k of CA

 

[JoulesThief]

The fine print in large

New vehicle prices, discounts, savings and other special offers may include some or all manufacturer incentives, which are assigned to the dealer. Maximum manufacturer incentives and discounts may not be available to all buyers or may require financing or leasing with a specific lender. Financing, leasing and down payment offers are available to qualified buyers, not all buyers will qualify, may be in lieu of other manufacturer incentives and are subject to change by the lender. APR means annual savings or other special offers, are not valid on prior purchases, advertised pricing is valid on in-stock vehicles and may expire on a specific date noted with that discount, savings or other special offer. Additional limitations and requirements may apply to percentage rate. In most cases discounts, savings and other special offers cannot be combined with other discounts, apply and be noted with some vehicles, prices, discounts, savings and other special offers. Tax, title, registration, bank acquisition (if applicable) and dealer document preparation fees are extra. Service and parts prices, discounts, savings and other special offers are plus tax and shop supplies where applicable. All prices, discounts, savings and other special offers are subject to change. Vehicle illustrations and videos are for design purposes, actual vehicles may have different equipment or look different. Vehicle equipment listed may be incomplete. Differences in MSRP for what appear to be similarly equipped vehicles may be due to additional manufacturer installed equipment or limited time manufacturer "value packages" not listed. MSRP does not include dealer installed equipment, if applicable.


Aka, NOT a fixed price, and probably includes all rebates including the 2.5k of CA

it's for sale in Maryland, it wouldn't include the CA $2500 state rebate.

 

[Farfle]

Nowhere does that small print mention Tax Credits towards end user, unless I missed something?

I just found these dealers searching for new e-Golfs on Autotrader. Here's another one that's in RI that lists the same $18K for the 2016 SE edition.

At any rate, I contacted a few of those dealers to see what's up. I have nearly zero intention to purchase one anyways, since I can't get the full tax credit with me currently unemployed . At this point it's intense curiosity. I've seen the i-Miev under certain situations under $10K too utilizing all available Tax creds in GA for example, so this might not be as ludicrous as it initially seems.

 

[forbin404]

Nowhere does that small print mention Tax Credits towards end user, unless I missed something?

I just found these dealers searching for new e-Golfs on Autotrader. Here's another one that's in RI that lists the same $18K for the 2016 SE edition.

At any rate, I contacted a few of those dealers to see what's up. I have nearly zero intention to purchase one anyways, since I can't get the full tax credit with me currently unemployed . At this point it's intense curiosity. I've seen the i-Miev under certain situations under $10K too utilizing all available Tax creds in GA for example, so this might not be as ludicrous as it initially seems.

$129 /month with TTL Drive Off. 7.5k
Not bad, not bad

But you can see in the lease sign off that they are including the $7500. so you aren't getting that.

To get the CA $2500 you are going to have to get that car titled in CA, first. If it is titled in Maryland? then the CA rebate is invalid.
So it's $18k - $2500 + TTL (1900) = $17.5k~

That's a nice deal for a egolf, of course I couldn't see any Vin #s on that place so I'm a bit skeptical that they have it in stock.

 

[Farfle]

As a side note, I'm really confused why nearly every topic on this forum is about leasing an e-Golf, rather than buying them. Is this like a common sense thing with EV drivers that I'm not aware of? I'm in the market now for really cheap 3-year-old EVs coming off lease, which is how I stumbled upon the eGolf scene. Thanks

 

[RonDawg]

As a side note, I'm really confused why nearly every topic on this forum is about leasing an e-Golf, rather than buying them. Is this like a common sense thing with EV drivers that I'm not aware of?

I don't have the stats, but I suspect more battery electrics are leased than purchased. Two reasons I feel that way:

1. The Federal tax credit, if the manufacturer chooses to do so AND you use their leasing arm, is passed along to the consumer immediately. Nissan, VW, Kia, and Fiat do this for their BEVs; Tesla does not, Ford sometimes does for the Focus Electric (not sure about the Energi series), GM does for the Spark EV but not always for the Volt.

2. The rapid degradation of 2011/2012 Leaf batteries in climates with extreme summers (Phoenix, Las Vegas, some parts of CA) left a bad taste in the mouths of owners who are now "stuck" with these cars. It also made future EV buyers/lessees a bit gun shy about getting one. Leasing helps alleviate some of these concerns as you know you won't be stuck with the car. If it's worth less than residual, it's the lessor's problem to deal with.

3. BEVs especially have appalling depreciation. My 2012 Leaf had an MSRP of around $35k when new. Residual after 3 years was $16.7k. A month or so after I returned it, I Googled the VIN and found the car for sale at CarMax in Oxnard, CA for $10k. A month later they dropped the price to $9700 before it was finally pulled from their page. I'm not sure if it was ever sold or auctioned off.

4. We are on the cusp of allegedly "200 mile" BEVs. Tesla Model 3 is available for pre-order but first deliveries won't be for a couple of years. Chevy Bolt and Nissan Leaf 2.0 are supposed to be coming out by that time. Even VW themselves have promised a 300 km (186 mile) range BEV in the near future. Once these cars are actually available, existing BEVs will have even less value.

 

[JoulesThief]

I got my e-Golf for such a good price, I am not too concerned about the 3 year depreciation rate. 2015 SEL in Oct for $15,200 my cost after all tax credits ($7500) and CA rebate. I drive around a bit in the city of L.A. I feel I am doing my part to help keep the air cleaner that if I drove one of my TDI's around in the city. So I use the TDI outside of L.A. on trips the e-Golf would spend too much time recharging. I've had the e-Golf 6 month now, and have 4400 miles on it. The longer I keep it, the less depreciation per year I will accrue on it.

If it works long enough for me, 8-10 years, and my driving habits don't change too much, I feel it will have been a good value. My maintenance costs on it, I am hoping, will be very, very, very low. Or I reach the point where I trade it in on another electric VW with more range per charge. But for now, I get 100 miles per charge, easily, so far.

 

[Farfle]

As a side note, I'm really confused why nearly every topic on this forum is about leasing an e-Golf, rather than buying them. Is this like a common sense thing with EV drivers that I'm not aware of?

I don't have the stats, but I suspect more battery electrics are leased than purchased. Two reasons I feel that way:

1. The Federal tax credit, if the manufacturer chooses to do so AND you use their leasing arm, is passed along to the consumer immediately. Nissan, VW, Kia, and Fiat do this for their BEVs; Tesla does not, Ford sometimes does for the Focus Electric (not sure about the Energi series), GM does for the Spark EV but not always for the Volt.

2. The rapid degradation of 2011/2012 Leaf batteries in climates with extreme summers (Phoenix, Las Vegas, some parts of CA) left a bad taste in the mouths of owners who are now "stuck" with these cars. It also made future EV buyers/lessees a bit gun shy about getting one. Leasing helps alleviate some of these concerns as you know you won't be stuck with the car. If it's worth less than residual, it's the lessor's problem to deal with.

3. BEVs especially have appalling depreciation. My 2012 Leaf had an MSRP of around $35k when new. Residual after 3 years was $16.7k. A month or so after I returned it, I Googled the VIN and found the car for sale at CarMax in Oxnard, CA for $10k. A month later they dropped the price to $9700 before it was finally pulled from their page. I'm not sure if it was ever sold or auctioned off.

4. We are on the cusp of allegedly "200 mile" BEVs. Tesla Model 3 is available for pre-order but first deliveries won't be for a couple of years. Chevy Bolt and Nissan Leaf 2.0 are supposed to be coming out by that time. Even VW themselves have promised a 300 km (186 mile) range BEV in the near future. Once these cars are actually available, existing BEVs will have even less value.

Interesting list. I feel #4 is a very strong point. 2-3 years from now, when 200mi is the new standard, it will make the current EVs look extremely outdated, and thus very depreciated. The funny thing is, though, for the most part these are not goofy cars. Their amenities are pretty much that of their gasoline-equivalent high-end trims. Thus, the cars themselves minus the drive trains, are quite premium and provide a very interesting juxtaposition to what their used prices will shortly become.

I don't think any other car in history has dropped its value like how we'll see with these current EVs come 2018. I anticipate existing EV models will be under $5k, with less than 20k miles driven. That's just insane!

 

[JoulesThief]

As a side note, I'm really confused why nearly every topic on this forum is about leasing an e-Golf, rather than buying them. Is this like a common sense thing with EV drivers that I'm not aware of?

I don't have the stats, but I suspect more battery electrics are leased than purchased. Two reasons I feel that way:

1. The Federal tax credit, if the manufacturer chooses to do so AND you use their leasing arm, is passed along to the consumer immediately. Nissan, VW, Kia, and Fiat do this for their BEVs; Tesla does not, Ford sometimes does for the Focus Electric (not sure about the Energi series), GM does for the Spark EV but not always for the Volt.

2. The rapid degradation of 2011/2012 Leaf batteries in climates with extreme summers (Phoenix, Las Vegas, some parts of CA) left a bad taste in the mouths of owners who are now "stuck" with these cars. It also made future EV buyers/lessees a bit gun shy about getting one. Leasing helps alleviate some of these concerns as you know you won't be stuck with the car. If it's worth less than residual, it's the lessor's problem to deal with.

3. BEVs especially have appalling depreciation. My 2012 Leaf had an MSRP of around $35k when new. Residual after 3 years was $16.7k. A month or so after I returned it, I Googled the VIN and found the car for sale at CarMax in Oxnard, CA for $10k. A month later they dropped the price to $9700 before it was finally pulled from their page. I'm not sure if it was ever sold or auctioned off.

4. We are on the cusp of allegedly "200 mile" BEVs. Tesla Model 3 is available for pre-order but first deliveries won't be for a couple of years. Chevy Bolt and Nissan Leaf 2.0 are supposed to be coming out by that time. Even VW themselves have promised a 300 km (186 mile) range BEV in the near future. Once these cars are actually available, existing BEVs will have even less value.

Interesting list. I feel #4 is a very strong point. 2-3 years from now, when 200mi is the new standard, it will make the current EVs look extremely outdated, and thus very depreciated. The funny thing is, though, for the most part these are not goofy cars. Their amenities are pretty much that of their gasoline-equivalent high-end trims. Thus, the cars themselves minus the drive trains, are quite premium and provide a very interesting juxtaposition to what their used prices will shortly become.

I don't think any other car in history has dropped its value like how we'll see with these current EVs come 2018. I anticipate existing EV models will be under $5k, with less than 20k miles driven. That's just insane!

Wait until 2018 and spend $5000 then.

 

[johnnylingo]

4. We are on the cusp of allegedly "200 mile" BEVs. Tesla Model 3 is available for pre-order but first deliveries won't be for a couple of years. Chevy Bolt and Nissan Leaf 2.0 are supposed to be coming out by that time. Even VW themselves have promised a 300 km (186 mile) range BEV in the near future. Once these cars are actually available, existing BEVs will have even less value.

I don't think any other car in history has dropped its value like how we'll see with these current EVs come 2018. I anticipate existing EV models will be under $5k, with less than 20k miles driven. That's just insane!

There's another variable affecting this though - the $7500 Federal Tax credits will start running out sometime in 2017, and some state incentives will expire too. Without the full benefit of those applied to new vehicles, it will boost prices on the used market.

A 60-100 mile range is perfectly acceptable for someone seeking a simple commuter car.

 

[Sptgolf]

Farfle,
You can take advantage of the tax credit even if unemployed as long as you lease the car. With a lease, the finance company buys the car, claims the tax credit, and passes it through to you by reducing the sales price. The overall lease depreciation cost is reduced by $7,500. Check out leasehackr.com to see how it works.

 

[Rsolaregolf]

Doubt if they pass the full $7500 to you though.

 

[bizzle]

The credits don't expire based on time but rather how many vehicles each company sells. It's going to take a long while for VW to sell 200,000 EV's so I doubt you have to worry about the federal credit expiring anytime soon for an eGolf.

Also, VW does pass the full $7500 to the customer.

 

[Farfle]

Ok, so let me get this straight:

The auto manufacturers are taking the credits themselves if customers lease the cars, but in effect reduce the cost of the leases by that amount as well. That brings car values down to their "normal" gasoline-equivalent ones.

So then why is it, after 3 years, these cars' used-value depreciation FAR exceed their gas cousins? There's something going on with the whole KBB valuation system that's decreasing the values far below what they should be.

Here's my guess: It's almost like KBB is saying "oh, well the AVG price of these being sold/leased new is that of their gas cousins IF we count the credits so let's start there in trying to determine its true value" but then in the same formula their also saying "finally lest we not forget we need to deduct the value of the tax credits!!" Uhh, what? You already did that in the beginning, you don't need to do it again! So the cost of these end up being $7-$10k below what they should be, relative to their gas cousins.

What the hell? It seems like KBB is devaluing these cars by a gross amount because they're counting the credits twice. Who gets screwed in this? The people who chose to buy the car, rather than lease it. They thought they were buying a $30k car after the credits, to find out it really only had a value of $20k according to KBB. Then, taking the normal huge depreciation hit every new car has, in just a few years, even with extremely low mileage, their seemingly $30k car--a car with an MSRP of $40k but KBB'd at $20K--is all of a sudden reduced to $10 or so.

That's downright criminal and I would be incensed as a BUYER. Yeah, sure, there's something to be said about investing in new tech and that's their fault, but these cars ARE being devalued and someone IS taking the hit from this.

 

[Sptgolf]

Doubt if they pass the full $7500 to you though.

Yes VW has been passing through the full 7,500 as "lease bonus cash." The key is to negotiate a low price, then stack the incentives as much as you can to reduce the net capitalized cost.

See this link for a good break down.
http://leasehackr.com/blog/2015/12/24/californians-e-golf-117-month-0-down

For my unemployed friends may I recommend a free focus electric?

http://leasehackr.com/blog/2016/3/27/californians-lease-a-ford-focus-electric-for-free

 

[miimura]

Ok, so let me get this straight:

The auto manufacturers are taking the credits themselves if customers lease the cars, but in effect reduce the cost of the leases by that amount as well. That brings car values down to their "normal" gasoline-equivalent ones.

So then why is it, after 3 years, these cars' used-value depreciation FAR exceed their gas cousins? There's something going on with the whole KBB valuation system that's decreasing the values far below what they should be.

Here's my guess: It's almost like KBB is saying "oh, well the AVG price of these being sold/leased new is that of their gas cousins IF we count the credits so let's start there in trying to determine its true value" but then in the same formula their also saying "finally lest we not forget we need to deduct the value of the tax credits!!" Uhh, what? You already did that in the beginning, you don't need to do it again! So the cost of these end up being $7-$10k below what they should be, relative to their gas cousins.

What the hell? It seems like KBB is devaluing these cars by a gross amount because they're counting the credits twice. Who gets screwed in this? The people who chose to buy the car, rather than lease it. They thought they were buying a $30k car after the credits, to find out it really only had a value of $20k according to KBB. Then, taking the normal huge depreciation hit every new car has, in just a few years, even with extremely low mileage, their seemingly $30k car--a car with an MSRP of $40k but KBB'd at $20K--is all of a sudden reduced to $10 or so.

That's downright criminal and I would be incensed as a BUYER. Yeah, sure, there's something to be said about investing in new tech and that's their fault, but these cars ARE being devalued and someone IS taking the hit from this.

I don't think Kelly Blue Book is just making up the numbers or blindly cutting the values. The fact is that not many people are eager to buy a used electric car after a 3 year lease is over. Especially Nissan Leaf vehicles. However, if they are automatically applying Leaf-like values to all electric cars then that is not justified. The problem is that not many other electric cars have a history as long as the Leaf. I think many people imagine that other EVs will have battery degradation issues like the 2011-2013 Leaf did. I don't think it will turn out to be true. It really hasn't with the Tesla Roadster, for example.

Here's another way to look at it - would you rather buy a used $20,000 car with a 5% loan for 5 years for a monthly payment of over $400 or lease a brand new vehicle for $250/month? When the price is $10,000 the monthly payment is barely over $200/month.

The incentives are definitely distorting the marketplace, but I believe the used prices are truly what the market will bear. Nissan in particular is really losing their shorts on the cars they leased with a low monthly payment due to high residual values that didn't turn out to be true. They are offering people $7,000+ discounts to their lease residual to buy out the car. It is in their interest to do that so that used prices don't fall even further due to the market being flooded. Eventually, every car they take back has to go to auction and the lower prices there hurt them much more than the discounts offered to lessees.

 

[johnnylingo]

The credits don't expire based on time but rather how many vehicles each company sells.

Ahh, my mistake. I thought the limit was 200,000 total. Indeed, Tesla, Nissan, and GM will hit those limits long before VW does.

This doesn't make a lot of sense to me because in the long run, those companies will be punished for their success. But that's our government for you. :?

 

[johnnylingo]

Nissan in particular is really losing their shorts on the cars they leased with a low monthly payment due to high residual values that didn't turn out to be true. They are offering people $7,000+ discounts to their lease residual to buy out the car.

BMW will likely end up doing the same on the i3s when their leases come up later this year. With the 2017 models offering increased range, it's now widely assumed those residuals will be closer to $20k than the $30k they predicted. Ouch.

I think the e-Golf residuals were more pragmatic. Looking in to 2018, I can still see them selling for $10-15k. Especially if gas prices go back up.