David Latif: Buying a car is not an investment. So if it's not a good investment, why would you want to buy it? You know, as you drive the car, it started depreciating. Every day that you're putting miles on it, every day that it's getting weathered and it's on the road, it's losing value as you drive it, as it gets older. It's not like wine that the older they get the more money they're going to be worth. So you don't want to own something that does keep going down in value because if you buy it, by the time you add the interest into the tax and license and everything, that $20,000 car is gonna cost you close to 30 grand. So and by the time you're done paying that 30 grand, that car is probably going to be worth about five grand with all the miles on it.
Tom Smith: Welcome to iDriveSoCal, the podcast all about mobility in the automotive capital of the United States - Southern California. I'm Tom Smith, and today we're digging in to talk about something I only recently started doing and that is leasing my cars instead of buying. I'm talking about leasing everyday drivers - the commuter that you're putting 10,000, 15,000 miles on a year, the grocery getter, the kid hauler. Those cars are taking a beating anyway so why not lease them? Well, it took me a long time to come to the realization that I ought to be leasing and a few cars ago. My wife and I started leasing and I'm not turning back. I love it for a lot of reasons including I'm not so crazy about, "Oh my god, it's got a little scratch." "Oh my god, it's got a little ding." "I got to park it you know five rows away from all the other cars."
But with me today is my friend, David Latif. David is a longtime automotive professional. He's also the general manager here at Rock Honda where we're speaking to you from today. And David's going to help walk us through the ins and outs of leasing, because it can be very intimidating. David, thank you again for joining me today and thank you for Rock Honda being a partner of iDriveSoCal.
David: Sure, you're welcome. Glad to be a part of it.
Tom: So as I mentioned, leasing can be extremely intimidating. Heck, the whole car buying process can be extremely intimidating. For me, leasing was something that I didn't do for a really long time because of the intimidation factor, and I was old school. I wanted to own the car. It was a stressful situation. And there was just more reasons to just buy and forget about it. But I've leased, as I mentioned in the open, I've started leasing. My wife and I started leasing, and I'm not turning back. I absolutely love it. Just from some high level facts first. When did leasing really become popular?
So you know, in the old days, this is when I was a salesperson; we're going back 20 years or so. When you leased a car, the price of the car wasn't disclosed in the contract. That was one of the biggest issue and problem with leasing because what they would tell you the price of the car is and what they would charge you would be two different things because you didn't see anything. The price of the car could be 20,000 and they're charging you 25,000. All you saw was a residual and the payment on the contract. The price was never disclosed. Ten years or so back, they change all the rules and laws. Now, the price shows on the contract. Since then, leasing has started picking up momentum and people are not really getting screwed leasing a car. In the past, people did. That's why people have bad taste in their mouth when it comes to leasing. "Oh no, I don't want to lease this." So now whatever you negotiate with the dealership or with the salesperson on the price of the car, that's what you're leasing the car for and you will see that on your contracts. That was one of the biggest changes that came in that changed our whole leasing industry.
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