I got a come-on email from the dealer. The usual, 'Your car is in hot demand, come in today and walk out with a new 2020 Kona Electric for only $7 more per month, all taxes/titles included!' For one thing, a 2019 to 2020 is nothing worth moving on and for another, they didn't even have a 2020 model in stock (a requirement stated in the offer), although they do have some 2021 Ultimates on the lot. So I ignored. I got a hard copy offer in the mail and then another email asking if I had seen the other outreach efforts. Fine, I got in touch:
"Do you guys even read these mailers? What am I missing? Hypothetically, since you have this urgent need for 2019 Limiteds, what can you do for me towards a similar in Ultimate trim?'.
Turns out they do NOT read these mailers and the answer was more depressing than I thought. Note, I'm not planning on selling (yet), so no impact. But it is depressing none-the-less.
Turns out there was nothing worth considering, mostly because based on Kelly Blue Book (KBB) the payoff was so high. That, and the dealer had the audacity to mention "Well, you know, 30,000 miles in two years IS high." What the ever-loving ef? It's a battery EV, not an ICE. I got it so I COULD put miles on it and not worry about typical mileage related wear. What, the piston rings in my traction motor are going to have oiling or hardness issues? From a dealer selling these things, these are just such out of touch talking points. But I digress.
Here is the KBB break down. I compared to a Limited FWD ICE Kona using KBB and online prices. Obviously, situations will be different, but the larger message is the same:
2019 Hyundai Kona Limited FWD 4D - $21,600 (high trade)
2019 Hyundai Kona Limited FWD 4D - $26,600 (high MSRP)
Percent Decline [(MSRP-Trade)/MSRP] = 19%
2019 Hyundai Kona Electric Limited 4D - $23,900 (high trade)
2019 Hyundai Kona Electric Limited 4D - $41,400 (high MSRP)
Percent Decline [(MSRP-Trade)/MSRP] = 43%
Difference to make 19% = $7,870
That is, $41,400 - $7,870 = $33,500 (adjusted trade value for 19%, almost $10K difference!)
That a Hyundai dealer who sells Electrics and is commissioning unread sales pitches would throw KBB back in my face is a bit of a slap. Not to mention, they might also want to factor in the cost of the battery that they owe me (but I get it, different pots of money: dealer vs mothership).
That $7,800 looks suspiciously like the federal tax credit. Only problem is that it is not cash in pocket that you could use to get your loan closer to not being upside down. You may not get any tax credit if you do not have the tax liability and it is UP TO $7,500, so it may be less or 0. I would hope that the manufactures are not using that to inflate the cost of their vehicles leaving the buyers on the back end to deal with it.
So, no real point here other than a depressing realization. Anyone looking to finance the bleeding edge, don't forget your gap insurance! With depreciation like this, a small hit could effectively leave you with no money to repair! Or better yet, buy used and save more than that slippery tax credit would offer anyway. You'll be further ahead, IMHO. But as always, YMMV.
"Do you guys even read these mailers? What am I missing? Hypothetically, since you have this urgent need for 2019 Limiteds, what can you do for me towards a similar in Ultimate trim?'.
Turns out they do NOT read these mailers and the answer was more depressing than I thought. Note, I'm not planning on selling (yet), so no impact. But it is depressing none-the-less.
Turns out there was nothing worth considering, mostly because based on Kelly Blue Book (KBB) the payoff was so high. That, and the dealer had the audacity to mention "Well, you know, 30,000 miles in two years IS high." What the ever-loving ef? It's a battery EV, not an ICE. I got it so I COULD put miles on it and not worry about typical mileage related wear. What, the piston rings in my traction motor are going to have oiling or hardness issues? From a dealer selling these things, these are just such out of touch talking points. But I digress.
Here is the KBB break down. I compared to a Limited FWD ICE Kona using KBB and online prices. Obviously, situations will be different, but the larger message is the same:
2019 Hyundai Kona Limited FWD 4D - $21,600 (high trade)
2019 Hyundai Kona Limited FWD 4D - $26,600 (high MSRP)
Percent Decline [(MSRP-Trade)/MSRP] = 19%
2019 Hyundai Kona Electric Limited 4D - $23,900 (high trade)
2019 Hyundai Kona Electric Limited 4D - $41,400 (high MSRP)
Percent Decline [(MSRP-Trade)/MSRP] = 43%
Difference to make 19% = $7,870
That is, $41,400 - $7,870 = $33,500 (adjusted trade value for 19%, almost $10K difference!)
That a Hyundai dealer who sells Electrics and is commissioning unread sales pitches would throw KBB back in my face is a bit of a slap. Not to mention, they might also want to factor in the cost of the battery that they owe me (but I get it, different pots of money: dealer vs mothership).
That $7,800 looks suspiciously like the federal tax credit. Only problem is that it is not cash in pocket that you could use to get your loan closer to not being upside down. You may not get any tax credit if you do not have the tax liability and it is UP TO $7,500, so it may be less or 0. I would hope that the manufactures are not using that to inflate the cost of their vehicles leaving the buyers on the back end to deal with it.
So, no real point here other than a depressing realization. Anyone looking to finance the bleeding edge, don't forget your gap insurance! With depreciation like this, a small hit could effectively leave you with no money to repair! Or better yet, buy used and save more than that slippery tax credit would offer anyway. You'll be further ahead, IMHO. But as always, YMMV.
