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Interest rates are brutal

Interest rates are brutal

Old Oct 16th 2023, 4:50 am
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Default Interest rates are brutal

I've been waiting a long time to purchase a new car, my old Honda Civic is on it's way out and decided to go the EV route as my wife qualifies for the full BC EV discount and I'm sick of paying for gas.

Decided to do a 48 month lease on a Kia Niro EV, base trim, really lovely car, super happy with it. Not oversized, basically just a good sized hatchback (even though they call it an SUV).

However the interest rate has kinda taken the wind out of my sails, 8.89%!

The amount at the start of the lease is around $40k, at the end after four years, it will be $30k left. So $10k over the course of 4 years (plus taxes). However, I'll actually be paying around $22k ($24k after taxes) over the 4 years, the amount of interest basically doubles the payment and amount paid.

No option though... need a new reliable car and don't have $40k lying around to buy a car. This is just the new reality I guess.
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Old Oct 16th 2023, 9:04 am
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Default Re: Interest rates are brutal

Have you looked at the Hybrid option? or another very similar vehicle, the "Lynk & Co" 01 for example?. https://www.lynkco.com/en (I presume it is available in CA)
How long do you normally retain a vehicle? If it is 5 years for example..work out your total costs over that period.

It's a similar situation here in Europe. Government telling everyone to drive electric but when you do the math and look at the options (Gas/Hybrid/EV) it opens your eyes a little.
The prices are ridiculous, especially where the manufacturers have clearly just taken a regular vehicle and stuck an electric motor in there.

Vehicles which where designed as an EV from the ground up are more reasonable.
Also, take a look at the mass of new Chinese EV's coming on to the market. The prices are surprisingly low (MG for example has a nice EV vehicle similar to the Nissan Rogue)

Also it is very evident that EV's lose their value rather quickly.

Good luck with the search and choosing.
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Old Oct 16th 2023, 11:33 am
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Default Re: Interest rates are brutal

Originally Posted by CanadaJimmy

No option though... need a new reliable car and don't have $40k lying around to buy a car. This is just the new reality I guess.
Think of the good you'll be doing though. And the sort of people you'll irritate.
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Old Oct 16th 2023, 2:15 pm
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Default Re: Interest rates are brutal

I don't think an electric car is a cost driven solution. Nothing wrong with them but, if you just want something boring to get around in, then a used hybrid is the better option. I have a Ford Something with a hybrid. It cost $20,000 out of the door of the garage with winter tyres and all. The running cost is barely measurable. I wouldn't drive it on a sunny day but if it's raining and the destination is the Costco car park where people are going to bang into it then it's ideal.

I see electric cars as being akin to my good cars, something fun that can also be used as transport. If you enjoy having one, you should have one, understanding that it's a lifestyle statement and there's a cost to that.
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Old Oct 16th 2023, 5:56 pm
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Default Re: Interest rates are brutal

Originally Posted by BristolUK
Think of the good you'll be doing though. And the sort of people you'll irritate.
True enough! It does feel great to be off fossil fuel, even though there is a premium cost for that.

Originally Posted by dbd33
I don't think an electric car is a cost driven solution. Nothing wrong with them but, if you just want something boring to get around in, then a used hybrid is the better option. I have a Ford Something with a hybrid. It cost $20,000 out of the door of the garage with winter tyres and all. The running cost is barely measurable. I wouldn't drive it on a sunny day but if it's raining and the destination is the Costco car park where people are going to bang into it then it's ideal.

I see electric cars as being akin to my good cars, something fun that can also be used as transport. If you enjoy having one, you should have one, understanding that it's a lifestyle statement and there's a cost to that.
Yeah I forgot to mention my previous car was a Civic Hybrid, which like you said it's true that hybrids are great on gas and have much lower running cost, just wanted to take that extra step this time. I think that's a fair assessment about electric cars, it shouldn't be that way, but then every car is basically a statement of some sort.
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Old Oct 16th 2023, 6:03 pm
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Default Re: Interest rates are brutal

Originally Posted by calman014
Have you looked at the Hybrid option? or another very similar vehicle, the "Lynk & Co" 01 for example?. https://www.lynkco.com/en (I presume it is available in CA)
How long do you normally retain a vehicle? If it is 5 years for example..work out your total costs over that period.

It's a similar situation here in Europe. Government telling everyone to drive electric but when you do the math and look at the options (Gas/Hybrid/EV) it opens your eyes a little.
The prices are ridiculous, especially where the manufacturers have clearly just taken a regular vehicle and stuck an electric motor in there.

Vehicles which where designed as an EV from the ground up are more reasonable.
Also, take a look at the mass of new Chinese EV's coming on to the market. The prices are surprisingly low (MG for example has a nice EV vehicle similar to the Nissan Rogue)

Also it is very evident that EV's lose their value rather quickly.

Good luck with the search and choosing.
Thanks for the insightful post. I'm hoping this car will be the one for a long time, like 10 years at least. At the end of the lease I'll have to figure out how to pay off the remaining balance, hopefully rates won't be as insane in 2027. I had my last car for around 5 years, but I would have held onto it for longer but I was starting to get a bit worried about the transmission and future issues seeing as it was up to 185,000 kms on the odometer.

Interesting that EVs lose their value quickly, I guess if it looks like it's in a bad position I'll just return it at the end of the lease.
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Old Oct 16th 2023, 7:51 pm
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Default Re: Interest rates are brutal

Originally Posted by CanadaJimmy
Interesting that EVs lose their value quickly,
Perhaps that's just the current position.

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