Leasing can be a cost-effective way to get into a new vehicle, however, there are a lot of factors to consider if you go this route. Currently, Genesis has 3-year lease offers on the 2020 Genesis G80 at two different monthly rates, $439 for the rear-drive version, $469 per month for all-wheel drive. But first, let’s establish a baseline of what it would take to buy the car using the subsidized manufacturer-offered 2.9-percent loan for 60 months.
Buying the Genesis G80
Starting with the $43,545 price of the rear-drive 2020 Genesis G80 and putting roughly 10 percent down will leave a loan balance of just over $39,000. Taking out a 5-year loan at the 2.9-percent subsidized borrowing rate, your monthly payment will be nearly $700 per month over the life of the contract. That’s with a monthly payment that’s more than 40 percent more than the lease with payments extending two years longer than the lease term. You’ll be paying nearly $3,000 in interest over the life of the loan. So, while the downside is higher monthly payments for a longer time, the upside is that you’ll own the vehicle outright. If you average between 12,000 and 15,000 miles per year, that means the odometer will have between 60,000 and 75,000 miles on it. Based on KBB values, a model in very good condition may be worth somewhere around $15,000.
Leasing the Genesis G80
The two different monthly payment options being offered by Genesis on the G80, the rear-drive model for $439 and the all-wheel drive version for $469 depends in part on whether or not you want or need the additional traction of all-wheel drive. The sticker price difference between the two is $2,500 (the cost of the AWD option). Over the life of the lease you’ll pay $1,080 more for the AWD version, or less than half the option cost, but keep in mind you’re only paying for the part of the car you use. You also may want to consider the AWD version because it will add to the value of the G80 as a used car if you decide to purchase it at the end of the lease.
The rear-drive lease option is based on a $43,545 MSRP. The contract requires $4,279 due at signing with a monthly payment of $439. Remember to divide the down payment by 36 and add that $118 to your payment—essentially your monthly out of pocket with be $558. This lease offer builds in a $2,000 dealer contribution (basically a manufacturer to dealer incentive) which lowers the overall capitalized cost of the vehicle and results in the $439 per month payment. The total of the monthly without the down payment is $15,804. At the end of the lease, you’ll have an opportunity to buy the car for $22,643.
The all-wheel drive G80 has higher MSRP of $46,045 and requires $4,489 up front for the $469. Add the down payment to the monthlies and you get $593. This lease also has the $2,000 dealer contribution built in. The total of all payments less the up front money here is $16,884. And you’ll be able to purchase the car for $23,943.
Lease end options
Leases are a way that manufacturers can incentivize their new vehicles without advertising fire sale rebates that could have a greater impact on the vehicle’s resale values. So, in effect you can be getting a pretty good deal, especially if you look at the option of buying the car at the end of the lease. This is worth considering for two reasons, the first is that you’ll be familiar with its history and the second is that these leases have caps of 10,000 miles per year. Exceed the cap and you’ll be charged 25 cents per mile. So, if you exceed the cap and buy the car, you avoid the excess mileage charges. Come in under the cap and you’ll be buying a car with less than 30,000 miles on the odometer. In fact, these caps help produce the kinds of late model, low mileage used cars that dealers count on to supply their Certified Pre-Owned vehicle inventories. In either scenario, the lease offer on a 2020 Genesis G80 may be a cost-effective alternative to an outright purchase.
Learn More: Buying vs. Leasing
