Cars are about to become free, which will you choose?
Car deals are getting closer and closer to free. There was a time when a car cost real money. You would have to actually pay the cost for the car, and the automaker would have to take a profit from that payment or go out of business. We all know that’s not true anymore, and a few recent examples have us wondering at what point some car deals will be so great that collecting the small stipend to complete the transaction just won’t be worth the hassle.
Our favorite example of a car being almost free is the Nissan Leaf. This is one of the top sellers among electric vehicles (EVs) globally, and is often the top selling EV in America in any given month. If you live in a state that likes to throw taxpayer money back at its residents, like California or Georgia, you might be able to finagle a way to make a Leaf pretty close to free. Start with the base model Leaf S. That car has an MSRP of $28,980. After your federal tax kickback of $7,500 plus your state kickback (Georgia) of $5,000, the car will cost you $16,480. That is on day one. Drive the car for a year and then sell it used for $16,480 to a resident of one of the sucker states that doesn’t throw money at its residents. Free car. Feel free to substitute the Leaf for a Ford Focus electric or Fiat 500e. The idea works the same way. We picked the Leaf because it is popular.
Here’s another idea. You have to drive for work though, and we don’t mean a commute. Let’s say you drive 5,000 miles each year for your job visiting customers, or clients, or rental properties, or some other valid, federally expensable trip. Your federal tax deduction for that many miles is about $2,800, or $233.00 per month. With almost no effort you can find a decent car like a base Camry that will lease to you for roughly that amount per month. If it’s electric, plug it in at work, or maybe even at a customer’s charging station, and skip the fuel payments too once in an while. The other 5,000 miles on the lease are yours to use however you wish. This is not a myth, I’ve done this with cars when I was on the road selling. The trick is to simply get the most basic car your employers and/or customers will tolerate you driving.
Another free car we like is the Honda Fit EV. In California it leases for $259 per month, with just $259 down when you sign up. That isn’t free according to my calculations. However, then the state of California gives you a $2,500 rebate. Hmm. Looks like the first 9 months are free. So not free for the whole lease, but for a long time it is going to cost you zilch.
If you don’t want to actually own the car, keep your eyes open for short term deals. We’ve seen some good ones, but our favorite was spotted by a Torque News staffer who may travel to Israel. There, a small car like the Chevy Spark rents for about $7.00 per day. There is some fine print, for example you must be a US resident and use a US credit card, but our staffer is and he will be. Considering a Venti Skim Latte at Starbucks is now about $ 4.35 most places, seven bucks a day for a car is basically free.
There was a time in the US when people actually paid for stuff like basic cell phones, long distance service, newspaper stories, magazines and other things we now basically get at no charge. With subsidies for EVs growing each year, and the actual cost of the cars declining each year, I’m going to keep my eyes open for a deal that says “Nothing down and nothing per month.” We aren’t far from it now.
Photo courtesy of GM global media page.