Residual Value for 2013 F10 M5 released today...

BMWDave · 29th June 2012, 19:47

...and it doesn't look so good. In fact it doesn't look so good for most BMW models across the board.

The all-new F10 M5... 36 months residual for 15k/yr is 48%. Most everything has lower residual
than expected, but also matched thankfully by a lower money factor, so probably a wash at net payment.. These rates are not effective until 7/10 - 7/31.

The new Money Factors are still being held confidentially, and won't be released for a little while.

Well at least, for those of us planning on leasing, now we know. It's not optimal, but what can we do?

MY2013 Residual Value Fact Sheet is attached.

AGS · 29th June 2012, 20:33

Quote:

Originally Posted by BMWDave

...and it doesn't look so good. In fact it doesn't look so good for most BMW models across the board.

The all-new F10 M5... 36 months residual for 15k/yr is 48%. Most everything has lower residual
than expected, but also matched thankfully by a lower money factor, so probably a wash at net payment.. These rates are not effective until 7/10 - 7/31.

The new Money Factors are still being held confidentially, and won't be released for a little while.

Well at least, for those of us planning on leasing, now we know. It's not optimal, but what can we do?

MY2013 Residual Value Fact Sheet is attached.

Unfortunately not the case. The MF is lower than expected, but not enough to offset the really sh!tty residuals. I just talked to the sales manager at my dealer. As I feared, with that low of a residual there was no way they could drop the money factor enough to get the estimated payment even close to what I thought it was going to be. For a 3 year, 12,000 mile/year lease the residual is 50% (48% for 15k/yr). The money factor is .00145. Based on these numbers my payments are almost $100 a month more than I had expected versus the 56% and .002 my salesman (and many other people) had estimated would be the program. As a point of reference the residual on my 2009 M5 is 57%.

As a side note, the sales manager is shocked at the latest rate sheet. As I was talking to him he was amazed at how they cut residuals across the board on most/all models. It doesn't speak well to BMW's confidence in the long-term value of their product.

Rohardi · 29th June 2012, 21:12

WoW... Just WoW

AGS · 29th June 2012, 21:21

Take a look at the 36 month column. The M5 is the only car below 50%. Even the M6 is at 51%. WTF!

BMWDave · 29th June 2012, 21:33

I have a personal theory on these low residual values for the new M5 and M6.

For the M5, I fear that BMW is doing what Audi has done with the R8. They are basically keeping the Residual values low so that not just anybody can walk in off of the street and lease one for cheap. Audi did this with the R8, but in an even worse way, the R8's residual values were and are still like 44% for a 36 month lease @ 15,000 miles, or something like that. We all know how well built and reliable the R8's turned out to be, so the only thing that makes sense is that Audi kept the Residuals low in order to prevent Joe Schmo middle class american from leasing one. I believe the same thing is now happning with the F10 M5. I have very very very much confidence that the F10 M5 is a much more reliable design than the E60 M5 with it's SMG and Vanos design flaws. Usually Residual Values have to do with confidence in how the product will perform and reliability over the course of the lease term, but as in the case with the Audi R8 and now the F10 M5, the residual value has reflected more of an exclusivity value rather than a reliability value.

As for the M6, it is probably given a higher Residual Value because of the higher base price of the vehicle, which is about $16,000 more in the U.S. Market than a base M5.

We may see the Residual Value for the M5 creep up to what the late model E60 M5's (2009-2010) were, which was about 57%, over the course of the next 5 to 6 years I would guess.

The necessary evil truth of it all is that either way you look at it, it's all an incredible waste of money. LOL!

ccibo72 · 30th June 2012, 00:12

Now ain't that the truth!

czarmar · 30th June 2012, 00:30

If BMW's projections are a reality, I can see myself getting into a nice used F10 M5 for cheap in a few years!

Lizard1 · 30th June 2012, 01:32

I've never leased before but was considering leasing through my business for my new M5. With a low residual, couldn't you just buy your car at the end of the lease very cheap then and turn around and sell it for a "profit"? Just thinking out loud. I guess then you have to deal with the hassle of doing so.

BMWDave · 30th June 2012, 01:41

Quote:

Originally Posted by Lizard1

I've never leased before but was considering leasing through my business for my new M5. With a low residual, couldn't you just buy your car at the end of the lease very cheap then and turn around and sell it for a "profit"? Just thinking out loud. I guess then you have to deal with the hassle of doing so.

Yes that is exactly right. This is the only upside of having a Residual Value so low. But then again, it is a hassle like you say, and you are forced to buy it at lease end because you have so much equity put into the car at that point. In this case, you would still be buying your car for cheap or you could turn around and sell it and make a nice tidy profit.

At least with a higher residual value, you are having lower monthly payments and its easier to just give the car back and walk away.