There appear to be a lot of questions about the numbers around the Battery Assurance Plus Program ("BAP"). I have it and I am reading straight from the lease agreement transfer document I signed. I have also had several discussions with the folks at MB Finance (who "owns" the program and the leases). By the way, they are GREAT people and are very friendly and helpful!
Here are a couple of points about the program:
* You don't pay the $80 (plus taxes) "for as long as you own the car" as someone suggested. "Someone" pays for 10 years UNLESS someone chooses to "buy out" the program. That "someone" is the collective stream of owners including the original owner/leasee.
* The car new is $5k less if you opt for Battery Assurance. You (as a used car buyer) "get" some of the savings because the car is - or should be - less expensive than a car without BAP. 5 grand less on a newer one.
*Edmunds, KBB, and the rest of the pricing folks do not have an "option" for BAP. Their values are based on RECENT SALES - BAP or not. The pricing services have not caught up with this, even though the cars with BAP have been available for years. So, their prices are meaningless for these cars. Look around and do your best. You should pay substantially less for a car covered by BAP.
* For the first 5 years you can buy out the BAP for $5010.
* A new battery DOES NOT cost $5k at the parts counter. More like $11k by some accounts ($20k by other accounts) plus install - but not $5k. MB Finance "values the battery ownership at $5k" initially - only for the sake of this program and their "math". An actual battery purchase will cost MUCH more.
* Every month after the initial 5 years has elapsed, the "buy out" price decreases 1.6% per month. At the end of 10 years, the buy out is $200.
* The monthly $80 + tax is a LEASE PLUS MAINTENANCE. Many people don't understand that the payment is for BOTH. You should not do the "math" using $80 and say the "battery is not worth it" or "the deal stinks" by ignoring the fact that you get 2 things for that price bundled together - and both have a value associated with them.
* You are guaranteed to have 80% battery capacity for up to 10 years (provided you keep paying). Since there is no data about what these particular batteries will actually DO in 10 years, some folks like the assurance/insurance.
* MB Finance can repo the battery legally whether you signed anything or not. Not sure if/how that may be done. No data yet, only anecdotes and rumors. The lease gives them the right to use "self help". IT people will recognize this as it is in some software licenses. In essence, they can "reach out and touch you" electronically if you do not pay and they can disable the vehicle any way they can... legally.
* When you buy the car used, you can "assume/transfer" the remaining lease or buy out the lease. If you choose to keep up BAP (and all payments are current) MB Finance "transfers" the remaining lease/maintenance to you. If there are overdue/late payments, you may be required to pay these FIRST, and then they will transfer the rest to you. MB Finance can, however, refuse to do a transfer on a delinquent lease. Although I would imagine they would rather get a paying customer and get the account current. One of the posters on another thread heard that MB Finance will give dealers 4 months “grace” on the payments. So if the dealer has it for 4 months or less then you likely would not get stuck with those overdue payments. I have not confirmed this with anyone at MB Finance. But this whole discussion is another good reason to do your research (get the VIN and call them before you buy!!).
My 2013, bought 2 months ago, has 7 years left to pay. The dealer bought it at an auction, paid the payment (or was forgiven by MB Finance) for the 4 months they had it, and completely "forgot" to mention anything about it. When I pressed them on the sale price they said the car “was already reduced”. They were not talking about the reduction being for the BAP, they reduced the price because nobody was calling asking about the car for months. The salesguy mentioned to me that "they knew about all the paperwork with these electric cars" and did not want to sell any more of them. “Paperwork”??? HMMMMM.
I bought mine with 9000 miles on it for $5700. Where can you buy a 2013 ANYTHING in near perfect shape today with 9k miles for $5700??? Well, you can't - even with this car you have the battery payment "baggage". It is not "wiping out your savings" as some have said in other threads. You bought the car (or should have bought the car) for way less, you now make payments, AND you get up to 10 years of insurance on a very expensive battery. You can look at it this way; you are making payments for a possible NEW BATTERY in the future. These things may well go below 80% capacity with normal usage (15k miles/year) before year 10. The early numbers SUGGEST 1.5% - 2% annual losses. Who knows if that will or will not remain constant or if it is the “norm”. Most stuff does not get "better with age".
These dealers who try to "look the other way" past this program (or simply are ignorant) and sign the "normal" paperwork are likely committing fraud. They (and you) sign documents saying they have clear title to the vehicle with NO LIENS WHATSOEVER. That ain't true if the car has BAP. It may not be long before one of these dealers gets sued and the rest will get "religion". If someone gets a battery repossessed somehow and can show the paperwork the dealer signed, that might be pretty compelling evidence that the DEALER is the rightful target for collection.
I was quite hesitant about buying my "lease return" vehicle UNTIL I discovered it had BAP. Imagine paying $5700 and then getting socked with a huge $11k or more (plus installation) charge for a bad battery!! I will wind up paying about $6,720 over 7 years. Add in the initial $5700 and I will pay $12,400. HOWEVER, this includes 7 years of battery insurance. However you split the $80 between payment and maintenance it still looks like a good deal to me. At a 50/50% split in the $80, I will have paid about $9k for the car and another $3,360 for 7 years(!) of insurance (on an $11k or more battery). Again, for me, this is a good deal.
You "mileage" may vary,
Mike
Here are a couple of points about the program:
* You don't pay the $80 (plus taxes) "for as long as you own the car" as someone suggested. "Someone" pays for 10 years UNLESS someone chooses to "buy out" the program. That "someone" is the collective stream of owners including the original owner/leasee.
* The car new is $5k less if you opt for Battery Assurance. You (as a used car buyer) "get" some of the savings because the car is - or should be - less expensive than a car without BAP. 5 grand less on a newer one.
*Edmunds, KBB, and the rest of the pricing folks do not have an "option" for BAP. Their values are based on RECENT SALES - BAP or not. The pricing services have not caught up with this, even though the cars with BAP have been available for years. So, their prices are meaningless for these cars. Look around and do your best. You should pay substantially less for a car covered by BAP.
* For the first 5 years you can buy out the BAP for $5010.
* A new battery DOES NOT cost $5k at the parts counter. More like $11k by some accounts ($20k by other accounts) plus install - but not $5k. MB Finance "values the battery ownership at $5k" initially - only for the sake of this program and their "math". An actual battery purchase will cost MUCH more.
* Every month after the initial 5 years has elapsed, the "buy out" price decreases 1.6% per month. At the end of 10 years, the buy out is $200.
* The monthly $80 + tax is a LEASE PLUS MAINTENANCE. Many people don't understand that the payment is for BOTH. You should not do the "math" using $80 and say the "battery is not worth it" or "the deal stinks" by ignoring the fact that you get 2 things for that price bundled together - and both have a value associated with them.
* You are guaranteed to have 80% battery capacity for up to 10 years (provided you keep paying). Since there is no data about what these particular batteries will actually DO in 10 years, some folks like the assurance/insurance.
* MB Finance can repo the battery legally whether you signed anything or not. Not sure if/how that may be done. No data yet, only anecdotes and rumors. The lease gives them the right to use "self help". IT people will recognize this as it is in some software licenses. In essence, they can "reach out and touch you" electronically if you do not pay and they can disable the vehicle any way they can... legally.
* When you buy the car used, you can "assume/transfer" the remaining lease or buy out the lease. If you choose to keep up BAP (and all payments are current) MB Finance "transfers" the remaining lease/maintenance to you. If there are overdue/late payments, you may be required to pay these FIRST, and then they will transfer the rest to you. MB Finance can, however, refuse to do a transfer on a delinquent lease. Although I would imagine they would rather get a paying customer and get the account current. One of the posters on another thread heard that MB Finance will give dealers 4 months “grace” on the payments. So if the dealer has it for 4 months or less then you likely would not get stuck with those overdue payments. I have not confirmed this with anyone at MB Finance. But this whole discussion is another good reason to do your research (get the VIN and call them before you buy!!).
My 2013, bought 2 months ago, has 7 years left to pay. The dealer bought it at an auction, paid the payment (or was forgiven by MB Finance) for the 4 months they had it, and completely "forgot" to mention anything about it. When I pressed them on the sale price they said the car “was already reduced”. They were not talking about the reduction being for the BAP, they reduced the price because nobody was calling asking about the car for months. The salesguy mentioned to me that "they knew about all the paperwork with these electric cars" and did not want to sell any more of them. “Paperwork”??? HMMMMM.
I bought mine with 9000 miles on it for $5700. Where can you buy a 2013 ANYTHING in near perfect shape today with 9k miles for $5700??? Well, you can't - even with this car you have the battery payment "baggage". It is not "wiping out your savings" as some have said in other threads. You bought the car (or should have bought the car) for way less, you now make payments, AND you get up to 10 years of insurance on a very expensive battery. You can look at it this way; you are making payments for a possible NEW BATTERY in the future. These things may well go below 80% capacity with normal usage (15k miles/year) before year 10. The early numbers SUGGEST 1.5% - 2% annual losses. Who knows if that will or will not remain constant or if it is the “norm”. Most stuff does not get "better with age".
These dealers who try to "look the other way" past this program (or simply are ignorant) and sign the "normal" paperwork are likely committing fraud. They (and you) sign documents saying they have clear title to the vehicle with NO LIENS WHATSOEVER. That ain't true if the car has BAP. It may not be long before one of these dealers gets sued and the rest will get "religion". If someone gets a battery repossessed somehow and can show the paperwork the dealer signed, that might be pretty compelling evidence that the DEALER is the rightful target for collection.
I was quite hesitant about buying my "lease return" vehicle UNTIL I discovered it had BAP. Imagine paying $5700 and then getting socked with a huge $11k or more (plus installation) charge for a bad battery!! I will wind up paying about $6,720 over 7 years. Add in the initial $5700 and I will pay $12,400. HOWEVER, this includes 7 years of battery insurance. However you split the $80 between payment and maintenance it still looks like a good deal to me. At a 50/50% split in the $80, I will have paid about $9k for the car and another $3,360 for 7 years(!) of insurance (on an $11k or more battery). Again, for me, this is a good deal.
You "mileage" may vary,
Mike
