Leasing vs. Buying a Ferrari

Buying Vs Leasing A Ferrari

There’s hardly a brand with as rich and deep history in racing and performance than Ferrari.  For more than 70 years, the Prancing Horse has dazzled the world with its sports cars.

Ever on the forefront of automotive development, each Ferrari is a perfect symphony of cutting-edge technology and fine art sculpted in premium materials.

Ferrari is anything but the ordinary. From the sweeping curves to the razor-sharp creases, the design is always theatrical, provocative and extreme. But, also refined!

You can never mistake a Ferrari for any other car in the world.

You’ll notice the low-hanging wide grille and forward slanted headlights in your rear-view mirror. Next time you look, it will be breathing down your neck. Just for a split second. Before it launches ahead, effortlessly, gracefully, and disappears into the winding road.

This is the Ferrari experience – exhilarating on the road and breathtaking on the track.

Look, we’re not going to pretend Ferraris are cheap and attainable. The cheapest one starts at $210,000 MSRP without options and 10-year-old “pre-owned” models still go for six figure sums. Even 30+ year classic Ferraris like the id 1970’s GTBs can will cost you close to $100,000.

Leasing a Ferrari, and not the fastest one at that, can cost you $2,000 – $3,000 per month and require you to drop up to $50,000 as down payment before getting the keys.

Set aside another grand per month for running costs such a fuel, insurance, tires, etc… Maintenance for seven years comes in the purchase price for all Ferraris since 2013. However, older models will come with an eye-watering cost for maintenance and repairs.  As with all lease terms (and especially exotic cars), your contract will have a mileage cap, so that keeps wear and tear costs down in theory.

Before we break your heart any further, let’s talk about why you would want a Ferrari in the first place.

Uncompromising performance

More than 90 years after Enzo founded his racing team, Scuderia Ferrari remains the most successful F1 team in history. His legacy lives on into the 21st century and Ferrari is obsessed with winning and will go to extreme lengths to secure victory every time at every venue.

Ferrari Portofino

The slowest Ferrari in production today goes from 0 to 60 mph in 3.5 seconds. That’s the 2020 Ferrari Portofino – the luxury grand touring 2+2 convertible in Maranello’s portfolio.

It’s not designed for record laps, but make no mistake. The Portofino is still a lot faster than many people are prepared to handle. The 3.9-liter twin-turbo V8 engine spits out 591 horsepower and 561 lb-ft of torque – the lowest any Ferrari comes with in 2020.  And it’s still a 10-second car out of the factory.

If you’re not utterly impressed, it only gets more ridiculous from here on.

Ferrari GTC4 Lusso

Ferrari only makes one practical (for Ferrari standards) vehicle– the GTC4 Lusso.

It’s got all-wheel-drive and all-wheel-steering, but most surprisingly – a hatchback. Yes, this shooting brake (fancy name for a 2-door station wagon) is designed to fit four grown adults comfortably as well as a reasonable amount of their luggage.

The Lusso is as close as you get to a Ferrari family hauler for now, yet it’s powered by a 6.3-liter naturally aspirated V12 engine, producing 680 horsepower at 8,000 RPM.

And then we get to real hot stuff.

Ferrari F8 Tributo

New for 2020, the Ferrari F8 Tributo replaces the 488 as the rear-mid-engine sports car. It inherits the 3.9-liter twin-turbo V8 engine from the track-focused 488 Pista, with 710 horsepower and 568 lb-ft of torque. At 3,164 lbs, the F8 is mind-blowingly quick – 2.9 seconds to reach 60 mph, 10.2 seconds for the quarter mile.

Of course, the 488 Pista is the company’s current flagship production track car. Last year, the Pista ran a lap around the Nürburgring in 7:00.03 as privately tested by Sport Auto. It’s the 9th fastest production car on the ring EVER.

Ferrari 812 Superfast

The name says it all – Superfast. The heart of the 812 is Ferrari’s most powerful and advanced naturally-aspirated 6.5-liter V12 engine with 789 horsepower and 530 lb-ft of torque, redlining at 8,900 RPM.

The 812 is mind-blowingly fast. It’s explosive out of the corners. The state-of-the-art Electronic Power Steering system controls both the front and rear wheels, redirecting all 3,845 lbs effortlessly, as if the car is sitting on rails.

Of course, the 812 Superfast is rather heavy and not the fastest Ferrari on the track. However, it may well be the fastest Ferrari to take on a trip. It’s a stunning GT car and will jump at the opportunity to get out on the road.

Ferrari SF90 Stradale

Want an absolutely insane vehicle?

How about a road car with 986 combined horsepower from four motors? That’s right, Ferrari’s latest hypercar – the SF90 Stradale – employs a 4.0-liter, twin-turbo V8 engine and as well as three individual electric motors.

It’s packed with state-of-the-art technology – all-wheel-drive with electronic torque distribution and stability control, F1-derived active aerodynamics, lightweight aluminum and carbon fiber chassis. The SF90 Stradale is the pinnacle of road-going Ferrari vehicles.

A true marvel of automotive engineering.

Why want a Ferrari? Why settle for anything less?

Why Ferrari is not the bench racers’ favorite?

Today we enjoy an explosion of supercar development. It’s not only common, it’s practically expected for new flagship hypercars to offer 1,000 horsepower. Make that 2,000 for the pure electric ones.

Ferrari’s always going to lose the numbers game. These cars don’t win on stats, but they absolutely do win in rear-world performance.

There’s a whole lot more than the horsepower of your engine, or straight-line acceleration. Winning on the track takes meticulous preparation and refinement.

Chassis balance, suspension tuning, control electronics, seamless synchronization between engine, transmission, brakes and other components. All of this goes into levels of sophistication impossible to comprehend, without an engineering degree.

The vehicle thinks and listens to your inputs. It understands what you want to achieve, and focuses every joule of energy towards the goal. You don’t know what it does, however, you can feel it working, modulating itself and getting around the corner faster than you thought possible.

That’s how Ferrari wins and it’s ready to sacrifice everything else to do it.

Pure driver’s car

You’ll notice we’re not spending too much time talking about the interior. That’s not because it’s subpar. Of course, your six-figure Ferrari comes with a beautifully sculpted interior, upholstered in the finest leather and plastered in high-grade materials.

But you don’t buy a Ferrari for the comfortable seats. Those are designed to keep your butt locked in as you approach 1g into the corner. You only notice the interior while you’re crawling through traffic. The second the road opens up, the car livens and the wheel consumes your attention completely.

All controls, the entire cabin really, is focused at the driver. Ferrari knows you can’t take your eyes off the road, so they put a control for every core function in the vehicle on the steering wheel.

Higher-strung models like the F8 and 812 don’t even have a regular touch-screen display in the center console. The passengers can’t even change the song, but they’re probably too busy holding on for their lives, anyway.

Thus, it’s difficult to call any Ferrari a practical vehicle.

Sure, the manettino allows you to dial in a less aggressive drive mode and there’s a button to soften the suspension for city driving. The entry-level Portofino and GTC4 Lusso, which you would consider driving daily, offer more interior features such as a nice touchscreen infotainment system with Apple Car Play, better ergonomics and more cargo space.

However, Ferrari is Ferrari. You’re either in it for the thrills, or you should consider getting an Aston Martin.

Buying vs Leasing your Ferrari

Everybody who’s sat in a Ferrari knows they light each of your senses on fire. However, owning them, form a financial point of view, is not always a sound idea.

The special edition limited series like the LaFerrari, SP1 and SP2, Enzo and others in the past will hold incredible value. These are the cars you want to invest in, because 5 or 10 years down the road, they can bring you significant profit.

The problem is, they are so exclusive, it’s not a matter of having enough money for monthly payments or outright purchase. You need to have the right status and the right history of owning other Ferrari cars before the company chooses to bestow you the opportunity to purchase one.

These landmark Ferraris are sold out way before their existence is even announced, so us common folk are left with the regular production models.

Sure, you can walk into a dealership, put $200 – $300 thousand dollars on their desk and order your new Ferrari Portofino, GTC4 Lusso. 488 GTB, or F8 Tributo. Cough up enough dough and you’ll even get the 812 Superfast.

However, if you had so much money to spend, the worst thing you can do is sink it into a depreciating asset.

Now, in the case of Ferrari, their cars don’t depreciate just like normal cars do. Due to the painstaking process of purchasing a brand-new Ferrari out of the factory, some cars even appreciate through their first year. It’s always easier to deal with a private seller than Maranello, so low-mileage 1 year old models can hold a 5-figure premium on top of their MSRP.

After that, depending on the particular car, you can see a startling volatility in the market value. Each car is a unique combination of options, equipment, condition and mileage, location, and even color. Since Ferrari introduces new models all the time, some cars hold their value incredibly well, others don’t.

The Ferrari 360 depreciated only 3% during its first three years. The Ferrari 612 lost 41% of its value for the same time period.

Some owners can lose $50,000 up to $70,000 and more on the value of their Ferrari just after one year. That’s an entire 2020 Mustang GT500 gone.

God forbid your Ferrari has an accident – even a fender bender. Nobody wants a crashed Ferrari and you’d see prices for examples with collision damage dip an extra $50,000 on top of the eye watering repair bill.

Leasing is a much more financially sound way to obtain a Ferrari.  Even when combining the down payment and monthly lease payments, you can come out on top at the end of the lease. If you know where to look there’s often Ferrari lease deals and specials to be found from dealerships and brokers.

On one hand, you and the leasing company will negotiate the residual value in advance and put that into the contract. Knowing the exact depreciation of your Ferrari during your tenure will help you make informed decisions and better financial transactions.

On the other hand, you can invest those hundreds of dollars elsewhere and win dividends and profit far greater than the interest charges of your lease contract. Even if we assume an APR of 4% (money factor of 0.00167) which isn’t great, a good investment plan should net you at least 8% ROI, which is double the amount.

Finally, there is the matter of sales tax.

When you buy a Ferrari outright, you also need to pay sales tax according to your state’s laws. For example, in California, where sales tax is 7.5%, a $300,000 Ferrari GTC4 Lusso will come with a $22,500 sales tax bill. This money is owed outright and cannot be recuperated in a subsequent resale of the vehicle.

However, when you’re leasing, most states required you to pay sales tax with your monthly payment as you go. If we assume a lease period of 36 months, a residual value of 60%, an APR of 4%, and zero cost reduction, the sales for the entire lease will be $11,160.

Even in states, where you’re required to pay the entire sales tax upfront, that’s still less than half.

Wrapping it up

Driving a Ferrari – any Ferrari is a visceral, highly-emotional experience. Once tested, it’s hard, often impossible to satisfy yourself with anything less.

However, unless you’re a person of preposterous wealth, the purchase of a brand-new Ferrari is best avoided.

Leasing a Ferrari or any other supercar is a much better alternative, which reduces your risk and frees up capital to invest elsewhere.

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