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Originally Posted by Brasko
Sounds like it could be similar to the Apple Upgrade or AT&T Next Programs. You basically pay an ongoing "subscription" price and become eligible to upgrade when you've paid a predefined percentage of the cost.
I wonder what the long-term durability of this program and how that will effect resale of the vehicles.
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Durability is an odd question: durability of the car or of the program? What they’re launching is, in effect, what OEMs have done for their corporate employees and families. Volvo, for one, has had a similar program for their employees for years; this expands on that premise but without any employee discount.
As for resale of vehicles: the retailer gets the car back, just sooner. They can market a 1 m or 2 year old car for less than MSRP and have a customer who doesn’t want to deal with the initial depreciation hit get a car that is still rather new. For the dealers: it keeps the cars in their network and allows them to resell a car more than once. The one concern will be he effect this will have on residuals for convential leases. Will they deteriorate from their current levels? That remains to be seen.