Note: After writing this, I saw other persons posting to other threads. To clarify, when speaking of buying from a used car dealer, I mean a private, non-MB dealer. If it is a MB dealer, you are almost certain that they are going to push the BAP lease, and quite possibly, have signed it themselves. Pay close attention to the documents that you sign, because if you did not sign the BAP agreement, you cannot be held to the terms of it. However the dealer might have pushed another type of document under your pen that did release your power of attorney to them. As always, buyer beware.
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I am taking an interest in purchasing a used Smart Fortwo Electric. I had the anxiety about the Battery Assurance Plus (BAP) program, and how it affects used electric buyers. I called up Mercedes-Benz Financial Services (MBFS), was transferred over to a rep for the BAP program, and had an interesting conversation with the rep.
I created a couple of very possible scenarios for the rep to respond to, and what I came away with lessened the anxiety. Its not a total relief, but it is something that I can deal with. Though I believe that there are others here who could not.
Summarizing the scenarios and getting to the gist of the discussion.
1. Who ever is the last person to sign the BAP lease agreement, and not fulfill the terms, is responsible for either returning the battery back to MBFS, or paying off the $5010. MBFS would prefer the latter. If they pay the $5010, they battery warranty will continue for the remainder of the 10-years when first put into service.
Yes, this means if you somehow acquire the car and battery 9 years into the warranty, and sign the battery lease, and then want out, you will have to pay $5010. Of course, it would be cheaper to just pay the lease for 1 year.
Now if this person is the original lessee, they did fulfill the terms of the lease, and did return the battery back to MBFS, so they are exempt, and MBFS just takes the loss. MBFS hopes that someone will sign for a new battery lease, and if asked will tell dealers that they have to sign the lease or get someone else to sign the lease. But MBFS will not initiate investigations just to find cars that were sold, to see if someone didn't sign a lease.
2. If the used car dealer does not make the lease available to the buyer, or sells the vehicle without the buyer's signature on the new lease agreement, then the buyer is not held responsible for the battery lease terms. However, see 5 and 6.
3. Even though MBFS reserves ownership of the battery (even with a signed lease), they will not confiscate the battery. If the vehicle is brought into a MB certified dealer for any service, the dealer most likely will run a VIN check. That check will indicate the battery is a BAP battery without lease. If there is no battery service needed, the dealership will not do anything about the lack of a BAP lease. It is not of their concern. The dealership will not seize the battery or the vehicle. The dealership will not threaten to withhold repairs until you sign the lease. The dealership might report to MBFS the car is being serviced, and MBFS might request the owners information, and then might send the new owner a battery lease agreement, but they will not pursue any more than that.
4. A little clarification. The glider (car sans battery) was leased from MBFS, the battery was leased from MBFS under a different contract and terms. When the glider's lease ended, and the glider was resold, all connection to MBFS was dissolved. However, the battery in the glider is still tied to MBFS.
This means when you take the car in for service, such as a problem with the air conditioning, the MB certified dealer is either doing warranty work (in that case, MB, not MBFS pays the dealer), or the car is out of warranty, and you pay the dealer for their work.
If MBFS wanted to repossess the battery, they would have to pay the MB dealership to remove the battery, and then pay to have the battery shipped somewhere for recycling. This costs MBFS money. They might refurbish the battery, but they will lose money upfront, and will then have to find a way to recover that cost.
If MBFS were to repossess the entire car, they would have a legal problem, because the buyer did not agree to the terms of the lease (because they did not sign it or it was never presented to them), and it is only the battery in contention, the glider holding the battery is exempt. The repossession of the glider would be theft.
5. And here is the important part. When you take the car in for battery service or battery warranty work, if you do not have the BAP, you will pay. Because you did not continue the lease, there is no warranty on the battery.
If the battery has a bad cell, you get to buy a new battery. If you had the BAP, MBFS would flip the bill for the battery replacement.
So, the question is, how much are you willing to risk?
- Buy the car and pass on BAP, hoping to never need warranty battery repairs?
- Sign the lease and cough up $80 a month for something that may never be a problem? There is a price for peace of mind.
- Get creative, and only when you have a battery problem, do you sign a lease, because that route would be cheaper than buying a new battery?
So to summarize this succinctly, if you don't continue the BAP, there is no warranty for the battery. It's that simple.
6.Let's try some suppositions.
A. You buy the car at a used car lot, and the dealer won't sell until you sign the BAP lease. If the dealer did sign the older BAP lease and now wants to transfer that to you, he will easily refuse the deal and wait for another buyer. The last thing he wants is to pay $80 a month for absolutely nothing. Or maybe you are paying $5000 over the dealer's cost plus profit?
B. If the dealer wants you to sign, makes up horror stories, but still allows you to not sign yet take possession of the car, they might be seedy and try to get the money out of you later, or possibly take you to small claims court or put a lien on the vehicle. The latter two are unlikely, but still possible.
C. If the dealer presents you with all of the paperwork to sign as part of the normal process of buying a car, and you see the MBFS BAP Lease agreement in the pile, check all of the other documents and ensure that there is no mention of a lease, sign them, and do not sign the BAP lease. If the dealer makes a stink, expect A or B.
D. If the MBFS BAP Lease agreement is nowhere to be seen, be glad, keep your mouth shut about it. In fact, don't ever mention it at any time during your communications, inspection, test drive, or negotiations. If you change your mind and really want the BAP, MBFS will be happy to send you a lease agreement at a later time.
