Is leasing a Chevy Volt a great deal?

September 26, 2012 11:23 AM

Is leasing a Chevy Volt a great deal?

I would not normally consider leasing a car, really just never seemed right for me. I tend to purchase used vehicles and hang on to them for as long as possible. However, I find myself in need of a replacement for my current daily driver. Local dealers are offering leases at $129/mo. for 36 months on Chevy Volts (with about 4K down and limited to 10K miles a year). I would normally consider this vehicle but it seems like a good deal and a great chance to try out the technology. Would be using primarily for commuting and local family travel. Would appreciate opinions as well as first hand experiences with the car.

posted by evilelf to travel & transportation (12 answers total)

It's quite an amazing deal, but if you think you might want to buy it when the lease is up, check out how much the residual value will be.
posted by kindall at 11:32 AM on September 26, 2012

I know someone who loves her Volt. If the lease deal is good, then the purchase deal should be good too.

Leases are computed based on the total cost, minus the lease term, and the residual amount at the end of the lease, basically, what the vehicle is worth at the end of the lease term.

You're putting $4K down and that's not chicken feed. Over 36 months, it's $111.11, so if you factor that in, it's actually $240 per month, or $8640. One thing you MUST know is how many miles you drive per year, and how much each mile over your 10k allotment will be.

So do you want to rent a car for $8,640 for 36 months? How much to buy the car? Right now there's a 0.0% interest rate to BUY the car. Also, if you buy it, you'll be eligible for a federal tax credit of $7,500 (and maybe a state tax credit too.)

I'm also assuming that it's a 2012 model year, which means that it's already old.

I hate leases, but once you run the numbers, this might be okay.
posted by Ruthless Bunny at 11:36 AM on September 26, 2012 [1 favorite]

Yes, there are good deals on the Volt right now. They're trying to move them. $129/month? That's an amazing deal.
posted by Dasein at 12:09 PM on September 26, 2012

I would agree with Ruthless Bunny that you should run the numbers on financing, though. Leases are generally more expensive in the long-term because you pay for the upfront depreciation. Also, make sure that the Volt fits your lifestyle - it really only makes sense to pay the price premium if you commute to work, can plug in at night cheaply, and don't commute too far, so you can run on cheap electrcity most of the time.
posted by Dasein at 12:20 PM on September 26, 2012

I read this article the other day on edmunds that points out things to consider for a lease. Like Ruthless Bunny mentions, there's the money down part, which doubles the lease as well as miles, which apparently is about 15k average across the country, so just things to consider.
posted by jourman2 at 12:55 PM on September 26, 2012

Some states may also make you pay the sales tax on the entire sales amount when you start a lease. My home state (IL) is one of them. Check that as well.
posted by JoeZydeco at 12:57 PM on September 26, 2012 [1 favorite]

Separate the residual value from the lease itself, as it is likely the maker is setting a residual value that is artificially high in order to offer the low lease.

tl;dr, leasing and then buying someone else's Volt at the end of the lease may be a better deal than leasing and then buying the car you leased.

(and $250/mo, including the deposit, is a fantastic deal IMO).
posted by zippy at 12:58 PM on September 26, 2012

I'm in Massachusetts, I assumed that the taxes would be paid up front on the total purchase price (which would be a huge negative), but apparently that is incorrect and tax is paid on the monthly payments.
Also, millage should not be an issue as I have a second 'fair weather' car which I will use most of the summer.
One drawback is that it only seats four which means my family pretty much fills it.
posted by evilelf at 1:10 PM on September 26, 2012

One thing: is it ever going to heat up in the winter? My friends Ford Hybrid does not ever heat up in cold weather (below 10 degrees they are scraping the inside of the windshield and wearing down suits) and I've heard similar complaints about Jeeps. The Prius seems to do fine in super cold weather but its something to be aware of.
posted by fshgrl at 1:27 PM on September 26, 2012

In Mass. you will have to pay excise tax on the car every year, separately from your monthly payments, or at least you do in Boston. The first couple of excise tax payments can be a pretty penny, so be warned.
posted by Elementary Penguin at 4:30 PM on September 26, 2012

Seconding the comments and Edmunds article: don't put money down when leasing.

Leases are generally more expensive in the long-term because you pay for the upfront depreciation. On the flip side, if you keep the lease length/miles reasonable, you'll return the car before it needs new tires, brakes, and other maintenance items. So leasing can be a nice deal if you play it right.

Run the numbers without the down payment, make sure you really truly won't exceed 10k miles per year, and it may indeed be a great deal (now you've got me considering it!).
posted by schoolgirl report at 4:51 PM on September 26, 2012

From a different perspective - I think a lease on a "new technology" car is an attractive option, assuming the numbers work for you. I believe this because, in my experience, the first few model years are used to shake out the battery pack/electric systems over the long haul. I'd hate to purchase and then find out in 4-5 years when the warranty is expired that you're on the hook for big systems overhauls.

I just got rid of a 2007 Civic Hybrid that I purchased new. I read all about the battery replacement cost fears and initial hybrid backlash and decided they were largely hogwash. About 4-5 years into my ownership Honda realized they had been too aggressive with programming the electric assist. They did a software update that protected the battery better at the cost of reduced fuel economy and even more sluggish performance. It then sucked to drive.

Our Prius, on the other hand, has been a winner all around.

All of which is to say, with unproven technology, I'd be cautious on a purchase. That lease, however, looks AOK to me.
posted by OHSnap at 9:04 PM on September 26, 2012