ElectricMotorcycleForum.com
Makes And Models => Damon => Topic started by: NEW2elec on November 05, 2020, 03:16:46 AM
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Damon posted on their FB page asking for interest in the possibility of leasing a motorcycle.
So far it was a pretty mixed response with some being die hard own it only and some others admitting they get new bikes often anyway no need to own.
I've never leased a vehicle myself but some of you may have a better idea of the pros and cons that go into it.
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For an electric motorcycle that might not be a bad idea. Once the lease is over, you don't have to worry about how much longer the battery is going to last and how much it'll cost to replace... it'll be someone else's problem. I think leasing is a better idea for electric vehicles than ICE right now for that reason alone. Especially for something as expensive as one of Damon's bikes. Something as relatively inexpensive as my S, not a problem... I'll own it outright.
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This is so stupid. Have they even begun researching how selling motorcycles works and how difficult it is to find financing companies? Have they worked out a floor plan even?
This question itself, when you understand even the tiniest basic parts of motorcycle financing, is indicative that the person asking the question has not done their due diligence and is asking dumb questions out their ass. Motorcycle leasing is a terrible idea.
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This is so stupid.
...and how difficult it is to find financing companies?
Motorcycle leasing is a terrible idea.
This statements contradict each other.
-Crissa
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Leasing, in the form of the PCP, has taken off massive in the UK over the last 20 years and is now, I think, the normal way to "buy" a motorcycle here, on account of them being so expensive these days. I myself won't touch a lease again - there are so many gotchas and hidden considerations and ways to be done over it's not funny.
Cas :)
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Yeah I've seen so many rider review videos on gas bikes where they talk about only owning a bike for a couple years and then trading it in.
That's not really my approach but if your not going to keep it 5-10 years it may be a good way to go. If they keep the gotchas out.
Princec that's interesting that it's a well established practice in the UK.
Brandon, from what I've seen and heard their business model is pretty simple. Just like Tesla.
The way Tesla sells cars, they want to sell bikes the same way. The way Tesla services cars, they want to service bikes the same way.
The way Tesla resells their cars when they come off lease and make a profit twice. That's what they are looking into.
They may try or they may not. We'll see but, that's why they are looking to take a consensus opinion of what people think.
When your making a whole new motorcycle you might as well keep thinking outside the box.
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Interesting and cool the UK has made it reasonable to do. Here in the US it is a big liability to do this sort of activity for the companies. So it is almost never done. You know us Americans.
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The fundamental difference though is that "P" in the PCP agreement... it's "personal", so companies aren't doing leasing in this way, it's only private consumers. Then again there's really not a lot of call for commercial use of motorcycles here anyway, they're essentially seen as toys by the govt. and population at large, which explains why they're so pointlessly expensive, complicated, and fast these days and all the riders are over 50. This may change over the next decade.
Cas :)
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Damon posted on their FB page asking for interest in the possibility of leasing a motorcycle.
So far it was a pretty mixed response with some being die hard own it only and some others admitting they get new bikes often anyway no need to own.
I've never leased a vehicle myself but some of you may have a better idea of the pros and cons that go into it.
I went to facebook and here is all that is used to start the discussion. At least the way it appears to me.
"Have you ever leased a vehicle before? Would you ever consider leasing a motorcycle?
Share your experience and let us know why in the comments!"
I never leased a vehicle however when I special ordered a pick up with a $1000 deposit rest due at pick up, come pick up they put me in a little room with a guy proposing for me to lease it instead. It did seem attractive the way it was presented but one thing for sure was they would get a whole lot of personal information on me with no guararantee of actually ever leasing to me. Some third party entity to make such decision if I recall correctly. Whether it was really seperate from the Manufacturer, who knows. There is value to the information about folks that might want to obtain one of these things.
If you can claim it is some business expense and understand the tax structure of your environment ... is this the kind of person who is intrested in these things?
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A small update to this point.
Along with the extra model variants Damon has started to give some details about their "subscription" option.
At this time a:
1. Premier model which will cost $39,995 with a subscription option of $530 a month.
2. The HS model which runs $24,995 or the subscription price of $331 a month.
3. The SX model with a sale price of $19,995 or subscription price of $286 a month.
4. The SE model with the sale price of $16,995 or subscription fee of $199 a month.
The Damon website also has this disclaimer:
*Subscription plans available on all Hypersport models at time of sale.
Choose from 24, 36 or 48 month plans on any Hypersport. See Terms and Conditions.
End statement.
At this time I don't see the full terms for the subscription laid out yet, but I'll add them as they come.
To me it gives you the option of just dating and not having to get married long term. :)
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Is a "subscription" another name for a lease, or is it something different? And if a subscription is really a lease, why not call it what it is. Unless there is some legal or financial reason not to do so. ???
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Car companies have started to use the term and for them I've heard it mean different things.
Some companies were going to offer a car subscription and you could exchange like a hatchback for an SUV if you needed one for the weekend.
For Damon at this time I'd say it's just like a regular type lease.
If other details emerge I pass them along.
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I hate to be negative, but the quasi-lease idea further makes me suspicious of the whole Damon thing. I really, really want to believe they will deliver the bikes they describe, but ask any Lightning "depositeer" what it is like to place money on hopes for an electric bike.
I am on the Damon mailing list and recently completed their survey. It seems to me they are trying to get word out via social media more than produce bikes to test ride. It smells too much like efforts to get funds rather than sell bikes.
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I put my deposit down as I feel they seem like a very enthusiastic and qualified team over at Damon.
While there is no sure thing in life and every startup has it's challenges, I think it's a product people are excited for and want.
To me that's the foundation for a good company.
As I've said before Damon is certainly taking a page out of Tesla's play book. No need for an ad budget if you can put out the product through cost free means.
The podcast thread I posted in this section with Damon's COO, talks about how they feel they several companies are wanting to back them and they now feel they have the luxury of looking for the best offer.
We'll see what the future brings.
Did you sign up for a test ride as well?
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Good to know about the subscription model! They are not the firs in the world to do this for electric bikes though. Checkout: https://www.revoltmotors.com/
They have 2 models at Rupee 2999 and Rupee 3999 /mo (~$55) and this bike has been a decent hit in India. And it is indeed based on the Super Soco :)
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There is a post for that bike in the general section. Looks like the same bike from China.
I take the Damon though. Eight days a week.
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Tesla offered cheap leases to fill out their S production when they were ramping up the 3. It's a great way to get people into seats who don't have the money to plonk down to outright buy.
We would definitely lease a Damon.
-Crissa
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The lease at least in my state seems a way to get around consumer protection laws that say it is necessary to be a dealer to sell in this case an automobile in my state, Connecticut. I think it is fair to call them consumer protection laws. It appears Energica does not want any dealers in New England, last I read the dealer in NY by the Hudson river has an exclusive for all of New england. Not sure if that means they can open another branch or not.
https://www.ctnewsjunkie.com/archives/entry/20200110_tesla_withdraws_appeal_to_supreme_court/
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Update based on Jay's latest interview. The subscription may be a bit less of a regular lease and set up in a different way.
We'll have to wait a bit for more details on this one. The term "lease" was only ever mentioned as a facebook question/survey in full disclosure. It may end up being very close to a regular lease but I don't know for sure yet.
Fran K yeah I know some state's don't allow Tesla's to be sold there because of no dealers. I'm sure it's CT 's congress looking out for the customer and not at all getting big donations from car dealers to insure they keep their sweet middle men cash cow businesses. ;)
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Car companies have started to use the term and for them I've heard it mean different things.
Some companies were going to offer a car subscription and you could exchange like a hatchback for an SUV if you needed one for the weekend.
For Damon at this time I'd say it's just like a regular type lease.
If other details emerge I pass them along.
As far as I’ve understood from Damon’s CEO last interview, they call it a subscription mode because it includes not only the vehicle itself but some other services around it, say like the connectivity and that sort of things. But maybe I got it wrong ???
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You are correct on that aspect Irdezcam he said the 4G connectivity cost would be included in the subscription.
In the same interview, it was the part about at the end of the subscription term where he said you can return the bike for a preset value towards another Damon bike.
What I don't understand at this point is, is that the only option to "swap" it for the newest bike, or when the subscription term runs out can you just return the bike and walk away so to speak. The full terms just aren't up yet as far as I can see.
I know most car leases have a set price the car is worth at the end of the lease and you have the option to buy it out right if you choose.
Jay seems to think the technology is going to advance so quickly that most people will want the newest offering every few years without the hassle of selling bikes yourself. The "I want the latest IPhone" people. :)
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Well this answers some of my questions on what options the customer has at the end of the subscription term. Not all the full details as of yet but a nice break down of the options.
https://help.damon.com/en/articles/4639265-what-are-the-subscription-plans
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This does not seem a sensible choice for someone that tends to bang things up. What is excessive wear and tear and is there any arbitration method? Another thing I seem to recall with Kawasaki loan it had a low rate but be late once and it jumped up lots. For amusement I copied and pasted a few lines from the above link. What if it is determined there is excessive wear and tear or more miles per year than specified (to be expected to such?) could the subscriber be liable for the buy out amount plus fees and intrest with the only recourse a court in Canada?
Final subscription information will be released in due course.
Damon guarantees the buy-out of this balloon on behalf of the customer provided unit has experienced normal “wear and tear”. A disposition fee of $450 due at end of repayment term would apply with this option
copy and paste below
Not all buyers will qualify and if approved may receive a higher rate and higher payment, depending on credit score. Some buyers will require a down payment in order to receive credit approval.
Tax, title, documentation, prep, set-up, freight, and other charges are not included
Other charges may apply.
Financing offer can change or be cancelled at any time
Did this answer your question?
End of copy and paste.
So the advertised prices would seem to have not only freight that would be expected but also set up and prep. Is this what others read into it? Better worded advertised prices have added.....
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Well like I posted all of the details aren't out yet. This is basically a frame work for this option.
I'm sure a mileage allowance will be stated later. As for normal wear and tear we'll see if there is any specific "no-no" for use but if you street ride the bike and don't lay it down or do stunt riding that would be normal riding.
You have to keep in mind there is a projected 2022 delivery date for the first Hypersport bikes so expect some changes and alterations by that time.
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It appears the term lease as in the title here is no longer appropriate. It is a balloon type loan with a Canadian entity. Damon says they will pay the baloon and take the bike back.
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Well the thread title was based on the Damon FB page question/survey that they posted.
This is what good old Wikipedia says a vehicle lease is and it sounds pretty much like Damon's subscription model. Really like a lease with an option to buy.
https://en.wikipedia.org/wiki/Vehicle_leasing
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What about any state and/or federal government EV incentives (such as the U.S. IRS EV income tax filing rebate)? Who gets those?
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I don't know Richard, that's a good question.
I've never gotten the tax credit and I'm not sure how a lease (or subscription) would be classified. My understanding is it's based on buying a new EV which might qualify is you choose to keep the bike in the end but really I don't know.
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I don't know Richard, that's a good question.
I've never gotten the tax credit and I'm not sure how a lease (or subscription) would be classified. My understanding is it's based on buying a new EV which might qualify is you choose to keep the bike in the end but really I don't know.
I seem to recall reading somewhere about auto EV leases in the U.S. that the dealership gets to apply for the rebate(s) as they continue to own the vehicle when it is leased. ???
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It appears the term lease as in the title here is no longer appropriate. It is a balloon type loan with a Canadian entity. Damon says they will pay the baloon and take the bike back.
In US terms, that's a lease.
-Crissa
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It appears the term lease as in the title here is no longer appropriate. It is a balloon type loan with a Canadian entity. Damon says they will pay the baloon and take the bike back.
In US terms, that's a lease.
-Crissa
Is the rider or the Canadian financial institution the title holder? Is the institution a Lein holder?
https://www.cga.ct.gov/PS94/rpt/olr/htm/94-R-0384.htm
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Is the rider or the Canadian financial institution the title holder? Is the institution a Lein holder?
https://www.cga.ct.gov/PS94/rpt/olr/htm/94-R-0384.htm
That seems irrelevant to US terms.
...I also don't see the relevance of your link to anything about whether their subscription is a subscription or a lease, since apparently taxes have to be paid by the holder of the title either way. Whether they've agreed to pass them on or not is irrelevant to the taxing authority. Which sorta makes sense.
-Crissa
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It's just financing, with a guarantee that Damon will cover the balloon payment at the end of the term. They have an explanation here on their website: https://help.damon.com/en/articles/4639265-what-are-the-subscription-plans
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I'm definitely a subscription type of buyer. I don't really hold on to a motorcycle for more than a couple of years. Not rushing to put a deposit down on a Damon though. As far as I'm concerned, it's still vaporware.
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So when you finance a vehicle, you pay and pay and pay and as long as you pay all you agreed to then you keep the vehicle.
In a lease/subscription you pay for a certain amount of time and then you have options, but one of them is to return the vehicle to the dealer or manufacturer and walk away.
The balloon payment is set up for people who don't want to do right. If you tear up the bike or don't keep up your payments and think "forget it I'll just walk away" then the balloon payment gets dropped in your lap.
It's almost like collateral in a way. Do right and everything is good. Don't do right and there are consequences.
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As Damon has posted on their FB page, here are the end of subscription terms in a nut shell. Copied and pasted:
Our subscription plans allow you to enjoy a HyperSport on your terms. Choose from a 24, 36, or 48-month subscription on any HyperSport!
At the end of your term, you have the option to:
🔸 Pay the remaining balance and keep your bike
🔸 Trade in your motorcycle for a new model
🔸 Renew the subscription
🔸 Return the motorcycle to us
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Is it strange they don't offer an option to return the bike for the latest improvements like they say they intend on doing to the returned ones before being sold as essentially certified used?
Will they even be capible of taking back the volume. You pay first or enter into the financing agreement and they get paid first, any disputes are between you and the trucker and or the trucker's insurance. How about on the return will any disputes be between the trucker and whom.
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As Damon has posted on their FB page, here are the end of subscription terms in a nut shell. Copied and pasted:
Our subscription plans allow you to enjoy a HyperSport on your terms. Choose from a 24, 36, or 48-month subscription on any HyperSport!?
?
At the end of your term, you have the option to:?
🔸 Pay the remaining balance and keep your bike?
🔸 Trade in your motorcycle for a new model?
🔸 Renew the subscription?
🔸 Return the motorcycle to us
I am hardly and expert on the subject, but that sure sounds like a "lease" to me. ???
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Yes Richard the only thing I can think of off hand is the 4G internet connection cost is included so "subscription". I'm not 100% sure and there might be some other legal definition for the term I'm not aware of. As always be sure to read over any agreement before jumping in but again we are over a year out and more details will follow.
Fran K I'm not sure I see what your asking for the first part. But if in 2,3 or 4 years time they have new models that you like better or fit with your changing interest then you can swap out at a preset value for your first bike. You can buy the second bike out right or start another subscription.
The plan is to not only have sport bikes and other motorcycle styles but "light mobility vehicles" AKA three wheeled vehicles that sit between a car and a motorcycle.
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Generally when people use weird terms around money, something is weird. When something is about money, and a company starts talking odd... I stop trusting them.
This is another nail in their coffin for me. Rapidly approaching full-on vaporware for me.
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On the Transport Evolved YT channel the TEN 327 video at the 6:51 mark they talk about how Ford is doing the same type of lease for the Mustang Mach E. As she states this is how it's often done in EU and one of the benefits is you get the tax credit not the leasing company who gives you a little discount and pockets the rest.
Anyone should look any agreement over and make sure they understand what can happen under changing circumstances.
I wouldn't be surprised if this becomes the new norm for leasing but we'll see.
You can have your opinion about the company but if you think this is anything like Lightning I think your mistaken.
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Anyone should look any agreement over and make sure they understand what can happen under changing circumstances.
It has to be said that people are very, very poor at understanding the nature of financial contracts. About 90% of the population are unable to grasp compound interest which explains how finance companies do so well. The currently most nefarious, sneaky, and underhanded poor-value for money concept out there is the so called PCP deal, which is now apparently and incredibly the preferred way to "buy" a vehicle, despite its astoundingly poor value for money and massive hidden pitfalls. YMMV.
Cas :)
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A vehicle is a tool, as such, it has a cost to not having it.
As long as the balloon payment is below the value of the vehicle, it's no different than differing the down or leaving a balance or having a purchase option on a lease.
It's the balloon payment and how it looms that's the evil, not the contract itself. These are one of the devices that triggered/dominoed the 2008 recession.
-Crissa
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That's true, but many people do not realise they they do not own the vehicle. This is mostly OK until it gets stolen, or crashed, or they want to exit the PCP deal early, or they want to modify it.
Also... the maths of PCP is such that it is rather cleverly designed to keep you on a permanent PCP treadmill forever. The unsuspecting pleb is lured by the "low monthly payments" figure above all else initially (and hoodwinked into throwing their old vehicle in as the initial deposit, which you may as well just set fire to). The balloon is a distant worry, until it's not, at which point the only option for many (most) people is to stay on the PCP treadmill and get another new vehicle. There's only one winner, and it's not the punter.
More interestingly for the rest of us though, it creates a huge delayed backlash in the market, with tons of ex-PCP trade-ins flooding the market, further depressing used prices, and further crushing residuals and hence GFVs, ensuring the treadmill stays greased.
Cas :)
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Ok, wow.
So all I care about on the thread is the Damon agreement.
The fact that battery and other component technology is jumping up so fast makes owning an EV unappealing to some buyers. This lets you go 2,3, or 4 years and either walk away or trade it in for the latest and greatest or a different type of bike or vehicle, or buy the bike out right.
The balloon payment is just what it will cost you to either buy the bike out right or, as I've said before, if someone rags the bike out and misuses the battery or whatever goes beyond other limits are put in the agreement then that is the CYA for Damon or Ford. They aren't going to let someone tear up the vehicle and leave the manufacturer with a worthless torn up EV. Do right and it's all good and you won't pay any balloon payment.
No one can fix the fact that people like to lie to themselves and pretend they are rich and think they can get anything they want. No one's fault but theirs.
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The Financial Conduct Authority here takes a dim view of that attitude to finance though. Mis-selling financial products like PCP here gets lenders in huge hot water! Just tiny things like forgetting to mention some aspect of a contract or even ensuring a customer has understood all of the clauses means they'll be on the hook for compensation.
The rapid pace of technology will be reflected in the balloon payment. Another area where you can't win: low GFV means you can afford to buy it at the end ... but you've been royally suckered into buying something that has depreciated like a lead, er, balloon. High GFV means you can't afford to buy it so you'll be definitely stuck on the PHP treadmill. Genius.
Cas :)
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No one can fix the fact that people like to lie to themselves and pretend they are rich and think they can get anything they want. No one's fault but theirs.
This is the fact of the matter. There is nobody holding a gun to their head forcing them to stay on an imaginary "PCP treadmill". They are free to buy from a wide variety of less expensive or pre-owned vehicles. But they don't want to, and with these options, they don't have to. If they are unwilling to research or understand the terms of a contract, or unwilling to pay insurance premiums, then they have decided to take a risk and that's their choice.
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Yes, cheap used is good for the market. Lets more people in.
There is nobody holding a gun to their head forcing them ...
No one holding a gun say 'work' or 'pay rent', either. So this argument is trash.
-Crissa
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I don't think we will solve world economics issues here.
The bottom line for Damon's deal is it's another option that's not available from any other US market electric motorcycle at this time.
Of course if someone isn't sure about that option they can always just buy it same as any other new motorcycle.
And the world keeps spinning.
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Fairly sure we can get PCP finance for Zero and Energica here in the UK. For those that want to go down that route.
Cas :)
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Cas I don't think you know what the Damon deal is.
You see Damon agrees to pay the balloon payment and they get the bike back if the buyer chooses to walk away.
Zero or Energica aren't offering to buy back their bikes in the UK or anywhere else.
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I saw an article regarding leasing motorcycles in the U.S. I think it was published by motorcycle.com a couple of weeks ago. They said there were two companies that were willing to lease motorcycles here. One only would lease new H-D bikes. The other company would apparently lease any motorcycle, even used ones up to 15 years old, if my memory is correct.
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No one holding a gun say 'work' or 'pay rent', either. So this argument is trash.[/quote]
Your analogy is trash.