~ Auto Buzz ~: OwnersChoice with Flex
Showing posts with label OwnersChoice with Flex. Show all posts
Showing posts with label OwnersChoice with Flex. Show all posts

Friday, 3 October 2014

Nissan LEAF Owner Reviews the i3 After 3-Day Extended Test Drive



I have always maintained that a good number of i3 buyers will be Chevy Volt and Nissan LEAF owners that have just finished up the three year lease on their vehicle. Phil Tipper is an EV "early adopter" and leased a Nissan LEAF. His lease will expire next spring so he's trying to decide which plug in vehicle he'll get next. The i3 is on his list of possibilities and when BMW recently offered the i3 extended test drive Phil  jumped on the opportunity to get to know the car a little more. I love this extended test drive offering from BMW. I think it's a great way to give prospective customers a chance to absorb what the i3 is all about. Phil is already an experienced electric car driver so he could focus more on the specific features of the i3, but many others who have never experienced electric drive will find the extended time they have with an i3 intoxicating. Having more than a few minutes during a quick test drive at a dealership will absolutely help convince people that may have been on the fence. It's simple, the more you drive electric the more you like it. That extra time behind the wheel may be all they need to make the decision to go electric for the first time. Phil wrote of his experience and thoughts on his time with the i3 and posted it to his blog. I thought is was interesting to hear what a Nissan LEAF driver thought of the i3 so I asked him if I could post it here and he obliged. Below is the post from Phil's personal blog:

As regular readers of my blog know, I'm actively researching the next electric car to replace our 2013 Nissan LEAF SL when its two year lease expires next June, and that the BMW i3 is on the top of my list of contenders.

I like the BMW because of its light weight for an EV (because of the carbon fiber structure of its "life module"), giving it the potential for good energy efficiency and promising good handling around corners, because it has a relatively powerful and torquey motor making it quick off the line, because BMW has tuned in tight steering and minimal body roll, because it is a rear wheel drive design (for classic sports car handling), because I like BMWs and I like the personal service that a premium brand provides, and because I can get a model with a range extender that offers a total of about 150 miles of range, with more range available with a fill-up of a tiny bit of gasoline. I like the idea that a range extender will let us take trips as far as Santa Barbara and San Diego without worrying as much about the reliability of public charging and the time recharging would take.


I'm also fascinated by the concept that having a range extender as a cushion will actually let us, paradoxically, drive more electric miles because we'll be more likely to take the EV than to fall back on the Prius, and because we'll be comfortable dipping deep into the battery's charge because the range extender will be there as a cushion and we won't risk needing a charge to get home.

On brief test drives of the i3, I had been able to briefly sample the car's quick acceleration and tight steering, but I'd had trouble getting used to the strong regeneration when the accelerator pedal is released, and I had even felt a bit of vertigo, especially as a passenger when the car was driven vigorously. So I had some concerns to resolve. On Facebook and in person, drivers of the i3 had told me that these concerns would resolve themselves quickly after I had gotten more used to driving the car. A longer test drive was needed.

To my delight, some BMW dealers recently began offering three-day test drives of the i3. This was exactly what I wanted. I found a dealer within 25 miles of my home that was offering the long test drives, Shelly BMW in Buena Park, California, and I found their internet team responsive and easy to work with. I thank them and applaud their willingness to take on the bother and expense of offering this program. To me, the BMW i3 is a car that benefits from a longer test drive so that the customer can learn its unusual.driving dynamics. In fact, I think that brief test drives around the block can be misleading, mostly because of the strong regeneration. I picked up a base model "Mega" i3 with the range extender engine and the optional 20 inch wheels and tires last Thursday morning.
Here are some of the comments about my experiences that I posted on the BMW i3 Facebook group.
Random impressions from first 24 hours, 150 miles:
Regen braking:


It's pretty much a non-issue and I beg to retract all of my earlier doubtful and even downright negative comments about it. It is different, but it is manageable and you adjust fairly quickly. I would still like to have the regen strength adjustable for a more relaxed driving experience in certain situations. At low speeds with this car, you WILL brake significantly if you need to lift your foot to readjust its position on the accelerator, and it would be very nice to be able to reduce the regen power if you just want to relax and coast with your foot off the pedal for a few seconds. Also, as many have said, the regen strength is lower at high speeds, so you don't go into full-on braking at freeway speeds if you lift off. My wife's first test drive comes in a day or so, and I expect her to have issues learning to drive the car smoothly, and I also expect uncontrollable giggling at some point during her test drive (from her, not from me). But I was able to drive her on a day trip today without her feeling too jerked about. And that was in both Comfort and EcoPro modes.

Ride and handling:


The car does bounce around a bit more than I like on uneven pavement in situations when I want a smooth ride, especially when I have a passenger. When I'm out for sporty driving by myself, the ride is tight and just fine for me. I put a lot of this down to the short wheelbase that allows the car to bob over bumps, and the 20 inch wheels with low profile tires. I had mentioned getting just a touch motion sick on short test drives before, but I have to say that I really haven't felt that in my first full day of driving the car. I imagine that having a chance for my inner ear and brain to get used to the car has something to do with that. I'll just say that the car is less relaxing to cruise in than my Leaf is because the steering is very responsive to any turning input and I find that I have to pay more attention to where the car is in the lane than I do with the Leaf. Some would say that's the price you pay for responsive steering. Fair enough.

Sporty driving:

Oh hell yes! You owners know this, but I think that the best kept public secret about the i3 is that there is a little sports car demon hiding inside this little thing. When I'm driving alone on a twisty, hilly road, it feels as good as any sports car I've driven (remember that I'm in the Mazda, Nissan, 3-Series class, not the Ferrari, Porsche class). The skinny tires grip on curves like the devil and the torque of the motor just goes on and on. Very, very grin-inducing, and very BMW. For me, this is the one and only reason for ME to get this car. Frankly, a fully optioned Leaf SL or a Mercedes B Class EV would do as good or better job for family cruising duty. They are more spacious and more relaxing to cruise around in. But in my experience, the i3 is more fun to fling around than a Tesla Model S because of its small size, light weight and tight handling. And I've driven a Model S on some of the same twisty roads. Given that I'm limited on parking space and we can't really have more than two cars, my EV has to be my fun car as well as being practical. Since the FUN potential of the i3 is so high, I can probably live with the practical downsides of the car.

Performance on Rex:

I haven't had much time driving the car in REx mode, but I purposely ran the battery down so that the car would go into Rex. There is a slight, almost unnoticeable vibration in the cabin, and you can hear the two cylinder motor chugging a little back there with the windows up. I drove the car fast up a pretty steep hill with the REx running and there was no reduction in power that I could detect. I must say that I do like having the REx there as a cushion. I've been driving EVs for over three years and I know how to handle range issues, but it was very nice to see a 40 mile cushion on the dashboard as we finished our 70 mile trip today (Note: The gas tank was less than 3/4 full).
Driving efficiency:

If the mi/kWh onboard readouts are to be believed, I'm getting no better efficiency in the i3 than I do with similar driving in my 2013 Leaf SL. I expected something like 20% better efficiency in the i3, but as near as I can tell, Nope! (Note: see my revised comment on efficiency near the end of the article.) You might say that I must be pushing the i3 harder, but after a day of cruising with my spouse aboard, I got around 4.2 mi/kWh, which is what I'd expect from my (heavier) Leaf in the same kind or driving. This was a mix of suburban and freeway driving, in a mix of EcoPro and Comfort mode. Go figure.

Random minor observations:
I like having frameless windows on the front doors. Getting in and out of the car is a pleasure when I don't have to contort to get around the upper door frame.

I like the placement of the 12v power plug for a phone charger. My phone sits down there in that well with the charger plug and I don't have wires everywhere.

The door pockets are spacious and handy for carrying all kinds of small items.

Installing kiddie seats in the back seats was a bit challenging. We have two grandkids, a four year-old and an infant. I had to remove the rear seat headrest so that the bigger kid seat would fit properly down into place. The base for the infant seat takes up a surprisingly large amount of space front-to-rear, so when we put in the actual carrier cradle into the base, the front seat will have to be moved forward a lot. Since I'm long-legged and tallish, we'll have to put the infant base behind the passenger and have her move her seat forward, and we'll have the bigger kiddo sit behind me, the driver, and she and I will have to negotiate over leg room.

Finally (after first 24 hours): No electronic or mechanical gremlins, errors, CELs, nothing. Very reassuring.

And here is my summary of my experience after the end of the three day test drive:

I'll summarize by saying that I liked the car very much, and that most of my concerns were eliminated after a few days driving it.

Positives:


+ The strong regen is a non-issue. It took a long test drive like this to convince me, but I no longer see this as a problem. Even my wife found it manageable. (BUT I do have to mention that she did have a second of unintended acceleration when she wanted to use the brake and forgot that her foot was still on the e-pedal. This was after only ten minutes driving the car for the first time, and we're sure that with more familiarity, this wouldn't be a problem.)

+ The quick acceleration and tight handling were really rewarding and these would be the biggest reasons that I'd choose an i3 over any of the competitive cars. This is really a little sports car disguised as an economical city car, and it's the true standout, as far as I'm concerned, for sportiest small four-door EV. (I know that the Spark is pretty quick, but it's really a tiny little thing and wouldn't work for us as a family hauler.)

+ Material and build quality were very good, even in the base Mega model. I happen to find the interior materials interesting and even the compressed Kenaf panels are fine with me.

+ I liked the maneuverability and tight turning circle.

+ I happen to like the car's unusual styling.

+ We were able to install kiddie seats for our two grandkids and reassure ourselves that the car would work for kid transport duty. This included one rear-facing infant seat and one front-facing kid seat. Space wasn't plentiful. The infant seat base takes up a lot of horizontal (front-rear) space, so it limits how far back a front passenger can move their seat. So we put the infant seat base behind the front passenger so that as the driver, I can get my needed leg space.


Features that I found only so-so:

* Having no keyless entry on the base car is cheesy, especially since the car has keyless-go.

* No option for power seats. That really should be an option for those who want it, with full disclosure that it adds weight and might harm range.

* I still find the seating position too high, and I kept wanting to lower the seat below the lowest setting. Ditto the steering wheel. It feels too high even at its lowest, and the high steering wheel position gives me a kink in my right upper shoulder.

* Loud and uncomfortable wind buffeting with the windows down above about 55 mph. I like to drive with the windows down, and without rear windows to open (or a sunroof) the "air hammer" that happens with the windows down is severe. I found that raising both windows to within about 4 inches of closed helps a lot.

* There was an annoying "reciprocating" thrum that I heard/felt at moderate to low speeds. I was never sure whether it was tire noise or drivetrain noise, or both, but it wasn't a typical EV driveline low howl that changes pitch as you slow to a stop. It was more
of a cyclical thrum that got slower in its cycle as I slowed down. Is this typical for the i3, is it unusual, or could it have been specific to the 20 inch tires? (Update: Tom Moloughney, our i3 online guru, told me that he had confirmed this sound in his own i3 to be coming from the 20 inch tires.)
* The short wheelbase (five inches shorter than a LEAF's) makes the car rock and bob over road imperfections. It's tolerable but it sure isn't a serene riding car. For most of my personal driving, it's no problem at all, but for times when I want to treat my passengers to a smooth ride, it's intrusive.

* I won't get into complaints about the crippled USA REx implementation, but the EV range that I got with the car was an unimpressive 72-ish miles. That's fine for most of my driving, but I'm used to getting about 85 miles with my Leaf, so this felt a bit limited. I do like having the cushion of the REx, though, and I think it would let me drive more EV miles, because I'd choose to take the i3 more often when planned trip lengths are a bit long, and a total range of about 150 miles with the range extender is very attractive after driving a Leaf for three years. It will make the difference between being able to use the car fully and not being able to in the spread-out LA metro area.

* Energy economy was poorer than in my Leaf on the freeway, but better than the Leaf on suburban streets, including with spirited driving. I find this rather disappointing because if I get an i3 REx, I'd like to do more regional driving trips with it, and I was hoping for better freeway economy. OTOH, with the good economy at lower speeds, I can drive it around like a hooligan without any misgivings (free energy from our home's solar roof).
- The "coach" doors. Awkward to move kiddie seats in and out of the back seats unless you have plenty of space on the side of the car. We had to back the i3 out of the garage into the driveway to have enough space to swap the kiddie seats in and out. The maneuver also required removing one rear head rest because it interfered with the upper part of the forward-facing child seat, and this requires partially folding that rear seat forward to be able to remove the head rest. We found that it was also necessary to slide the front seats forward and flip the back rests forward so that we had enough room to get to the child seat restraints and belts.

We wind up needing to swap out the child seats a couple times a week because we have two cars and only one pair of child seats. So this will become a frequent exercise. Not a huge deal, but if it's raining (if it ever does around here again), I'd be either doing this drill in the rain in the driveway, or back the Prius out in the rain to be able to get the i3 doors fully open and move the kid seats in and out. First world problems, to be sure.

- The placement of the charge access door on the right rear fender. I was lucky that I chose a 25 foot cable when I bought my Aerovironment L2 EVSE. Since I mounted the EVSE near the left front fender of a headed-in car, my choices with the i3 are to back the car into the garage or to wrap the cord around the car to get the plug to the i3 charge port. The latter choice was the more appealing one to me, and it worked fine, aided by the i3's short overall length.

* And of course, I find the car's price and value for money proposition disappointing. I'm going to want a good sized discount AND a boost to the residual percentage to feel okay about the lease pricing. We'll see how things are next Spring, when I'm in the market. But BMW really needs to kick in the whole $7,500 Fed rebate, or price the car to make up for the difference. OCF (Owner's Choice with Flex - a purchase program with a guaranteed buy-back at the end of the term) programs are less attractive in California because you're charged sales tax on the car's full cost, even though you're only using it for a portion of its life. Leasing would be more attractive to me, but not at BMW's current pricing, rebate amount and residuals.

Lastly, the only issue or problem I had in three days and 265 miles was a problem with " low cost charging". Even though I had set the car in that mode, it insisted on charging immediately. This was with Level 2 charging with about 15% SOC remaining.

And by the way, my existing Aerovironment Level 2 home EVSE with Nissan badging worked great with the i3.


Thursday, 3 April 2014

BMW i3 Bottom Line: $494/mo With No Money Down






I wrote this post a few days ago for BMWBLOG. There has been so much speculation and incorrect information circulating in regards to the OwnersChoice with Flex option that BMW FS is offering on the i3 that I wanted to get some info out there on it. It's a new product, so it's certainly understandable why there are questions. However I've read where people have gone as far to call it a "convoluted scam" as if it's just a way to charge the customer more money and in fact it's the opposite. Using OwnersChoice with Flex you can drive off in a base i3 BEV with no money out of pocket for as little as $494/month depending on where you live.  Now that BMWBLOG has had it for a couple days and InsideEVs has run it also, I figured I'd put it up here also. If you have any questions, please fell free to ask in the comments and I'll answer whatever I can.

 BMW i3 Bottom Line:  $494/mo With No Money Down

There has been a lot of speculation with regards to financing rates and residual values for the BMW i3. A few months ago we ran this story where we posted preliminary i3 residual values that were lower than the residual values of other electric cars.

BMW Financial Services evidently took a closer look and now that the official financing figures are out we see they increased the residual values by 4% across the board.  

Original Reported Residuals       Actual Residuals 
  • 24 month residual – 49%                       53%        
  • 30 month residual – 44%                       48%
  • 36 month residual – 39%                       43%
  • 42 month residual – 34%                       38%
  • 48 month residual – 28%                       33%
  • 54 month residual – 25%                       29%
  • 60 month residual – 21%                       25%
(These figures are based on 15,000 miles per year. Add 2%for 12,000 mile/year leases, 3% for 10,000 mile/year leases.  Extra mileage is charged at 20 cents per mile.)
  

Additionally, the online “Build your Own” BMW i3 site now features monthly payment calculations for OwnersChoice with Flex. Up until now, only the MSRP was listed. OwnersChoice with Flex is a new product created by BMW Financial Services specifically for the i3. It allows the customer to take up to $7,500 off the price of the car as a capitol cost reduction, thus allowing lower monthly payments. The customer does not have to pay the money up front and basically owes that to BMW FS. The reason $7,500 is the cap is because that is the maximum amount of the federal tax credit that the i3 qualifies for. BMW FS is basically lending the customer the money so they can have lower monthly payments. 

The customer can repay the Flex capitol cost reduction anytime (like when they get the money back on their taxes) or wait until the end of the term. At the end of the specified term, the customer has the choice of returning the car and paying the amount they took as the capitol cost reduction (if they didn’t repay it already), or keeping the car and paying the residual value, plus the unpaid capitol cost reduction. It’s really a purchase, that offers the benefits of a lease and lets the customer decide whether they want to keep the car or return it at the end of the term. 

So what’s the bottom line on a 36 month OwnersChoice with Flex work out to? With no money out of pocket, depending on where you live you can drive off in a base i3 BEV and your payments will be $494 per month for 36 months. That’s with taking the full $7,500.00 capitol cost reduction (which you then owe BMW FS) and with only 10,000 miles per year allowed. If you load the BEV i3 up with every available option the monthly payment raises up to $661 per month. It’s worth noting that these figures do not include sales tax. There are states where electric vehicles are sales tax exempt (like New Jersey where I live) and it appears the i3 site does not add the sales tax regardless of whether you use a zip code where sales tax is collected or not. Perhaps that will be corrected though, as they only updated the site to show the monthly payments within the past day or so. 

The OwnersChoice with Flex was developed by BMW Financial Services specifically so i3 customers can realize the full $7,500 electric vehicle federal tax credit. When leasing an i3, BMW FS will only pass $4,875.00 of the $7,500 federal tax credit along to the customer. They are standing by their statement that they do not get the full $7,500 credit, and are passing along every dollar that they do get to the customer. This likely makes leasing a poor option on the i3 when compared to OwnersChoice with Flex.


Monday, 27 January 2014

BMW i3: Tax Credits and Leases and Residuals, Oh My!



Will BMW's financing options put the i3 out of reach for many of its enthusiasts?
There have been many discussions on various websites since an internal BMW document surfaced that led to people to believe the BMW i3 lease terms in the US would be very high. One potential i3 buyer even has his local dealer (Stevens Creek BMW) work up a lease quote using the information on the document. The i3 he built had a total price of $55,978.52. With very little money down the lease payment came out to be $930 per month. There were a couple things that led to this very high lease estimation and I thought it would be worth while to discuss them here.

The proposed i3 lease was posted by insideevs.com
First, the residual values on the document were very low, around 40%. Unfortunately this is basically in line with residual values of other electric cars and there are basically two reasons for it. First, electric cars are new to most people and there is a lot of uncertainty regarding what the secondary market will be. What will a 3 years old i3 with 40,000 miles be worth? How much will the battery have degraded? What will its practical range be at at that point? Until we have years of EV use behind us with tens of thousands of examples to draw data from, finance companies will likely err on the side of caution and offer low residuals on EV's. Then there are the tax credits and rebates. California is the largest market for EV's in the country and basically paves the way for everywhere else. EV's buyers in California not only get the $7,500 federal tax credit, but they also get up to a $2,500 State rebate. Therefore a used EV is instantly worth $10,000 less than a new one as soon as it rolls out of the lot.  So to be fair, you really should include the tax incentives and rebates in the equation when you discuss electric vehicle residual values, because that is the actual effective cost of the car to the buyer.. If you do that, the i3 residuals jump up to nearly 50%. That is still a bit low, but not really far off of what a typical car would be worth after a three year lease. 

The tax credit is now a center of debate
The document also showed that BMW is only going to apply $4,875 of the expected $7,500 federal tax credit as a capitol cost reduction to leases. This led some people to assume BMW is simply pocketing the $2,625. I raised this question to Timm Bock, Product Development & Pricing Manager for BMW Financial Services and he told me that BMW will only realize $4,875 for the federal tax credit and that they will pass every cent of what they get along to the customer. I still don't know exactly why they don't get the full $7,500 because it seems the other EV manufacturers do since they pass it along to the customer as a capitol cost reduction in their lease offerings. So either they get more than BMW does which would be surprising, or they are eating the $2,625 in an effort to push their electric vehicle offerings. This to me would be equally surprising, so I really don't know what the truth is at this point, but I will continue to investigate this. 

Timm was kind enough to also include an overview of the financing options BMW Financial Services will be offering for the i3, and this is what he sent me:
Tom,

Please see my response below regarding the Lease and OwnerChoice products you had asked about, as well as how each product relates to the Federal EV Tax Credit when purchasing a BMW i3.

Traditional Lease - Our tax team has advised us that each leased BMW i3 qualifies us for a Federal EV Tax Credit of $4,875 - all of which is passed on to the consumer.  This $4,875 Lease Credit can be directly applied as a Capitalized Cost Reduction, or to other costs, at the time of lease-signing.  Regardless of your tax situation, by choosing a BMW FS lease with the $4,875 Lease Credit, you'll know exactly how much you will benefit, it’s applied at the time of purchase and there is no subsequent filing, administration or personal tax implications.
(As a reminder, only EVs purchased for personal use are eligible for the maximum $7,500 tax credit.  However, the benefit is reduced to $4,875 for 100% business use.  Regarding Nissan and Chevy, we can’t speak to why they are choosing to offer $7,500 or more; this may be part of the their incentive or discount strategy.)


But for customers who want to claim the maximum tax credits, we have made attractive alternatives to leasing available:  OwnersChoice and OwnersChoice with Flex.

· OwnersChoice – OwnersChoice provides:  low lease-like monthly payments, the lease-like option to return the car at the end of the term AND the eligibility for you to claim the maximum income tax credits.  

· OwnersChoice with Flex - In addition to the OwnersChoice benefits above, OwnersChoice with Flex allows you to increase your final balloon payment due at the end of the contract term by up to $7,500. Increasing the final balloon payment due further reduces your monthly payments, and in this way provides you with the opportunity to benefit from the $7,500 immediately.  OwnersChoice with Flex bridges the time-gap between the vehicle’s purchase date and your tax filing date.  We are proud to say that BMW FS is the first in the industry to develop an enhanced balloon finance solution like this for EVs. 


BMW Financial Services will also offer our traditional loan product.  Like both of the OwnersChoice products above, a BMW FS loan provides you the eligibility to claim the maximum $7,500 Federal EV Income Tax Credit.  


In general, due to the uncertainty and complexity of tax credit rules, we encourage anyone considering an EV to consult with a tax professional.

While this doesn't really clear up the tax credit questions, it does give some clarity on the OwnersChoice with Flex product that they developed specifically for the i3. This will allow a buyer to get the full $7,500 tax credit, yet still return the car like a lease at the end of a predetermined period. It's a purchase, but allows the buyer to have a capitol cost reduction up to $7,500 (the customer decides how much they want BMW FS to deduct as a cap cost reduction) to lower their monthly payments. That money is then owed to BMW FS and the owner can pay it off anytime they want. The owner will then have the option of making a balloon payment equal to the residual value plus the additional $7,500 and buying the car outright, refinancing the balance and keeping the car, or simply paying back the $7,500 and returning the car as if it were leased. 

There is interest charged on the $7,500 cap cost reduction they applied that is baked into your monthly payment, but BMW will allow you to pay it back early and save on the interest expense. The best way to utilize the OwersChoice with Flex may be to pay the $7,500 up front when you take delivery of the car, therefore you'll never have paid a penny of interest on it. Of course you'll need to have the finances to do this, but since you'll be recovering the $7,500 a few months later when you do your taxes, you will only be a short time without the funds. (provided you qualify for the full tax credit)

I hope that provides a little insight into the OwnersChoice with Flex. However, admittedly it doesn't get us any closer to really knowing what leasing deals BMW will be offering. Until we get the official residual values, interest rates and terms, we're all just guessing. I just hope people don't expect the i3 to have leasing deals that are comparable to some other much less expensive EV's like the LEAF or Volt, let alone the great deals on some of the other manufacturers compliance EV's. These cars are subsidized by tens of thousands of dollars per vehicle just so the manufacturer can lease the minimum required be California, in order to continue to sell their gas cars there. BMW has been consistent with saying the i3 is going to be profitable from day 1, and BMW will not subsidize it. This will likely make the i3 more expensive to lease in California than a Honda Fit EV, a Fiat 500e or a Toyota RAV4 EV. However for the rest of the country this comparison really doesn't matter because those cars aren't available nationally like the i3 will be.

Personally I expect to BMW to announce the financing details pretty soon, like within the next couple weeks and I will certainly post them here. There is hope that BMW may surprise up with a good leasing deal after all though. This week at the NADA convention in New Orleans BMW's North American CEO Ludwig Willisch said "It will be an attractive lease offer" and "It will be in the ballpark of a normally equipped 3 Series". A friend of mine recently leased a pretty well equipped 328i and with $3,000 down and he's paying $415/month. I find it hard to believe the i3 will lease for that low, but I suppose it's possible on a base BEV i3 without any options. I'll pick this back up here once the details are revealed. 


Share This: