Decision Time on my 2016 LEAF Lease


My trusty steed: a 2016 Nissan LEAF SV
The 3-year lease on my 2016 Nissan LEAF comes to an end in August.  That means I need to make a decision whether to turn it back in or buy it out.  Linked with this decision is what vehicle would replace the LEAF as our daily driver if I decide to return it to Nissan.

For the TLDR folks, here's the summary:
  • I already have a Tesla Model S.
  • The 2019 LEAFs are too expensive for me.
  • My wife and I didn't like the Bolt EV.
  • The other 60 kWh+ EV aren't available in Michigan yet.
  • I have 16-year-old driver in the house.
  • I'm buying out the lease on the 2016 LEAF.
The point of this essay is not to convince anyone to come to the same conclusion, but rather to walk you through the thought process of how to approach the decision-making process and hopefully help you consider what EV may work for you.  For details on the above, read on.

Rewind to 2016

When we first decided to lease the 2016 LEAF, our garage contained a 2012 LEAF with about 80% of its original 24 kWh battery capacity due to lithium-ion battery degradation, a 2015 Tesla Model S and a 2011 Toyota Sienna minivan.  The 2012 LEAF was our first trial EV and was taking over most of the daily activities like taking the kids to school, grocery runs and errands of all kinds.  The low operating costs and its fun-to-drive dynamics gave it an advantage over the 14 MPG minivan, which was reserved for long road trips.  

The LEAF was clearly not our only vehicle, so it did not need to fulfill all tasks for our family such as road trips.  Nonetheless, my wife occasionally commented "I wasn't sure if the LEAF had enough range for what I wanted to do, so I took the van."  Despite Kansas City's outstanding public charging infrastructure, sometimes the LEAF wasn't up to the task.  

When the larger 30 kWh battery was introduced in the 2016 LEAF SL and SV trims, I thought this might be the trick to making my wife more comfortable with the range and thus use the minivan less.  The end goal for me was to get rid of our last ICE (internal combustion engine) vehicle and go full electric.

My 2012 LEAF heading to its new home in Topeka

Out With the Old, In With the New

Knowing full well that EV technology was still changing rapidly, we decided that 100-mile-range EVs would soon be eclipsed by longer-range vehicles, certainly 3 years from the 2016 lease inception.  This, coupled with the attractive lease deals at that time and a buyer for our 2012 LEAF put all the puzzle pieces into place to allow us to pull the trigger on this deal.  By the way, the 2012 LEAF is still tooling around Topeka, Kansas being powered by solar panels.  

Nissan absorbed the $7,500 tax credit and made it part of the capital cost calculation of the 2016 LEAF, meaning we could get the car for $0 down, about $320 per month for 36 months and a 36,000 mile limit with a residual value (what we would have to pay if we decide to buy the car at the end of the lease) of about $11,000.  That put the total cost of the car under $23,000 if purchased with the option to return the car in 2019 if something better came along in 2019.

Kansas City charging infrastructure

The 30 kWh Battery Made a Huge Difference

The range difference between a partially degraded 24 kWh battery and a fresh 30 kWh was significant for our purposes.  With about 100 miles of real-world range around town and the fantastic charging infrastructure where we lived in Kansas City at the time made the new LEAF a winner.  Very rarely did we feel the need to take the minivan purely out of range demand.  Even trips across town could be accomplished without charging, although we often convenience charged because we could.

Move to West Michigan

The greater range and ever-improving charging situation even allowed me to take the ostensibly short-range EV on a road trip from Kansas City to Michigan rather than paying to have the vehicle transported.  This cross-country trip was chronicled in my August and September 2018 essays.

In November 2018, we sold our minivan and we no longer had any combustion engine vehicles to fall back on.  Having said that, we have had two occasions to rent a minivan when the space in our vehicles was insufficient.  This was still way cheaper than maintaining a personally-owned minivan that we rarely drove.

With the advent of more DC Quick Charging stations like the ChargePoint in Walker, MI, the LEAF has proven itself as even a regional vehicle.  I've made several Muskegon to Grand Rapids airport runs which are well over 100 miles round trip.

Bottom line:  The 2016 LEAF is doing everything we require of it as a regional car.  Road trips are handled by the larger and more comfortable Tesla.

Still, is it time to consider an upgrade?

End of Lease, Here We Are

Why Not a Model 3?

Let's get the Tesla thing out of the way, shall we?  We already have a Model S and while I love it, there are reasons I don't want a Model 3:
  • It has a trunk, not a hatch.  I love the versatility of a hatchback.
  • It's not cheap.  Yeah, we already bought a Tesla, but that doesn't mean I can afford another.
  • I have a male teenager in the house that's learning to drive.  The combination of eye-popping acceleration, spiking testosterone and lack of a Tesla body shops is not a good combination.
  • While most Tesla service can be done by the mobile rangers, any non-ranger service requires an all-day trip to a service center from where I live.  Spending a full day driving to Chicago or Toledo to get my car serviced is not my idea of a good time.

Kia Niro EV
Image source:  https://www.kia.com/us/en/niro-ev
The Korean 60 kWh EVs

The YouTube EV feeds are full of praise and glory for the Hyundai and Kia electric offerings such as the Hyundai Kona EV, Kia e-Niro, Kia Soul EV, and the all-electric Ioniq.  The problem is for us Michiganders is that we don't live in a zero-emissions-vehicle (ZEV) state.  Therefore, we can't get these vehicles while the demand in the ZEV states is being filled.  Even if I bought one out of state, who will work on it locally?

The Chevy Bolt EV

We test drove a Bolt EV and although I like the range and EV technology, my wife and I didn't like the seats and the narrow feel of the car.  Since this car would be her daily driver, this option was ruled out more due to the ride than the EV tech.  

The 2nd Generation Nissan LEAF

I like the LEAF including 2018+ 2nd generation.  I really do.  It's a solidly-built practical hatchback that's fun to drive and easy to own.  The ProPilot and ePedal options were impressive during my test drives.  After 3 years with the 2016 model, I've had very few mechanical issues, it costs next to nothing in maintenance and operation.  Other than a Tesla and the Bolt, the LEAF is nearly the only choice of a new battery electric vehicles in Michigan.

Then there's the battery.

As an engineer, I appreciate the compromise of functionality and simplicity.  Therefore, I understand why Nissan made the initial decision to go with a passively-cooled battery pack.  However, that design has not held up well, particularly in the face of high ambient temperatures.  It's well known among LEAF owners that the batteries degrade rather quickly.  My first LEAF was down 20% of its capacity after 4 years and 30,000 miles.  My 2016 LEAF is down 14% after 3 years and 30,000 miles.  By contrast, my liquid-cooled 2015 Tesla is down 5% of its original capacity after 63,000 miles.  Thermally managed lithium-ion batteries simply have shown to have better longevity.

Now solidly into its 2nd generation (I consider the 30 kWH to be generation 1.5), Nissan has decided to stick with the passively-cooled battery not only on the 40 kWh battery pack, but even in the more energy dense 60 kWh battery pack for the 2019 LEAF.  Based on my experience on 2 LEAFs, I am wary of the degradation potential of the new LEAF.  Bottom line:  I don't want to own a 2nd Generation Nissan LEAF.  The only way I would drive one is as a lease.

I started exploring the lease deals on 2019 LEAF Plus (the 62 kWh, 200+ mile range version) models and for the mid-range SV trim that retails in the $42,000 range, the lease deals were coming back in the $530 per month ballpark with $1,000 down and a $16,500 residual.  That's about $200 more per month than my current LEAF lease.  Add those numbers up for a potential purchase at the end of the lease and that car is almost $37,000 not including sales tax including the $7,500 federal tax credit.  Ouch!

Used 2nd Generation LEAF

The same argument for the battery applies here as it does for the new LEAFs.  While you can get a 2018 LEAF with the 40 kWh battery on, say Carvana for $25,000, you can essentially get a similar deal on a new 2019 40 kWh LEAF by taking advantage of the $7,500 tax credit that's still applicable on the new LEAFs.  This change may make more sense in a year or two when the prices on used 2nd Gen LEAFs have dropped a bit more in the face of increasingly capable competition such as the Korean offerings.

The 2016 LEAF is now ours!

New Driver in the House

Perhaps the straw that broke the camel's back of getting a brand new EV at this juncture in our lives is that we have a 16-year-old with a learner's permit.  He's a good driver so far, but fender benders will happen.  I already mentioned that the combination of a Tesla and adolescent male testosterone is clearly a volatile combination.  I know...I did some crazy things with my mom's Accord coupe in the day.  

Bottom Line:  We Bought the 2016 LEAF

The price tag of the lease buyout plus sales tax and fees amounted to about $12,000 which is a fair bit under current street values of 2016 LEAFs that I saw on used car outlets.  

2016 LEAF battery degradation progression
(% capacity vs. months)
The jump up was due to the BMS update.

What About the Battery?

I've tracked my battery capacity degradation relative to this InsideEVs article on the 2016 LEAF battery and mine has tracked above the expected loss.  So while I don't expect to get a free battery replacement, it seems the car will maintain a reasonable range for its intended use.  

What's Next?

Purchasing the LEAF has now taken the pressure off of the need to change cars at the end of the lease and make a potentially poor decision now.  In other words, I could have settled for a 2019 LEAF Plus and then found out that the Kia Niro EV will be available in a few months (I doubt it).  

We will re-evaluate our options based on likely upcoming events such as our son going off to college and the availability of new EV models.  Of particular interest to us are the Tesla Model Y and the VW ID Buzz (my favorite YouTube EV video), both of which are still a ways from production.  

What's In It For You?

OK, so you just read a whole lengthy blog post about how I thought about a bunch of cars and bought out my lease.  What's the point?

In my interactions as an EV enthusiast, I get the question: "What EV should I buy?" all the time.  The answer is not straight-forward.  It largely depends on your needs and obviously your budget.  So think long and hard about how the car will be used and both the benefits and the limitations of the EV for your situation.

Here's how I might recommend a few scenarios:

  • Commuter-only car with a less than $10,000 budget:  2014-2015 Nissan LEAF.  Just be sure to have the battery degradation checked by someone with LEAF Spy.  If you don't know what that is, Google it or contact me.
  • Basic car such as for students which is mostly driven locally, but the occasional road trip:  Used Chevy Volt, 2nd generation if you can afford it, but the 1st generation are quite capable and often available inexpensively.  
  • Growing family:  Chrysler Pacifica Hybrid.  You can drive mostly electric around town and still take road trips using gas.
  • Sport sedan with occasional road trip with $50,000 budget:  Tesla Model 3 or used Tesla Model S depending on the size you need and whether or not you prefer a hatchback.  If you're thinking of something like a comparable Audi A5 or even Toyota Camry, make sure you do the math on fuel and maintenance costs.   Here's an article to give you food for thought.
  • Hatchback with 200+ mile range:  Chevy Bolt, LEAF Plus, Kia Niro EV, Hyundai Kona EV.  As written above, you'll likely have trouble finding the last two because they can't make them fast enough.  
  • Flagship large sedan with no budget:  Tesla Model S
  • Road trip and utility vehicle with no budget:  Tesla Model X
Even with these, you can shoot holes in those choices based on your personal needs, wants and budget.  Keep in mind that a car does not have to fulfill all needs.  Maybe a local commuter EV is perfectly fine if you only need to rent a gas car a few times a year for a road trip or towing a UHaul trailer.  

If you are thinking of getting an EV or plug-in hybrid would like to bounce your particular situation off someone, please feel free to contact me.

Resources:

If you are in the market for a Tesla Model S, Model X, or Model 3, Tesla has reestablished its referral program.  Feel free to use my referral code to get 5,000 miles of free Supercharging (at the time of this publishing) for your Tesla:  http://ts.la/karl5062

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