2015 Genesis vs. 2015 C-Class

[roblaw]

I know this is counter-intuitive but listen to my argument and see if you think I am crazy. Also, I am making my comparison based on information I have read but not having seen or driven either car.

I like my 2012 Genesis 3.8. I was looking forward to the 2015. I like the looks and the interior of the 2015 and from the limited reviews, it is likely going to ride better than the old car. I live in the northeast so all of the 3.8s will be AWD (as will all of the C300s when they come out in Sept.). Overall I have had an OK experience with my 2012. The dealership experience has been OK but not luxury car good. I say this having just given back my second Lexus and leased a new 2014 Mercedes ML350 for my wife. It really is a different experience altogether.

I am thinking about this comparison because one poster make the very valid point that the ownership experience and resale value of the Genesis is likely to be lower than the luxury brands despite the Genesis being an equally good car in most respects.

Now I know it may seem like I am comparing apples and oranges but hear me out. First, from what I have read, the C300 is going to have 241hp/273 ft. lb. 4 cyl. power plant that is likely to accelerate as well or better than the Genesis (which is likely to weigh 4400+ pound in AWD form vs probably 3600 pounds for the Benz). Look at the performance figures for the 3 series with the base 4 and you see 0-60 times in the mid 5s. The C-Class has dropped weight in its newest version so I am betting numbers will be in the high 5s for the C300 AWD sedan unless they are over-rating the engine. Given the MT test, I am expecting 0-60 times for the 3.8 AWD to be in the mid 6s. And, unless they were able to completely re-tune the torque curve and the tranny, it will feel a little underpowered on the bottom end. I really like the 3.8 motor and when you hit it just right, it really moves. But bottom end torque is mediocre and it has a flat spot that drives me nuts sometimes. I know they 2015 is supposed to have a better torque curve but I am doubting it is going to make up for 400 extra pounds and the extra friction of AWD.

Now with the extended wheelbase the C-Class should have an adequately comfortable rear seat. The Genesis is a very roomy car and the C-Class will not come close; so if you are using the car for ferrying around a lot of tall people on a regular basis, the Genesis will be superior. However, MB is likely to ride well and be quiet (regular references in reviews are made to a shrunken S-Class) and the interior seems very nice and high quality in articles and pictures.

With the increase in price for the Genesis and proper optioning of the C-Class, I am thinking they will not be terribly far apart in price. I mentioned my wife's new ML350 because MB is really trying to make their numbers. Not only did they give $7000 off list and had good lease rates but MB also gives another $2000 off for membership in certain organizations such as the ABA, AMA, USAA, etc. I ended up getting her a $60k car for a lease price of $627 a month with just fees up front. I think they will keep the lease rates and general pricing competitive to keep volume up and I am betting the overall cost of a nicely optioned C-Class is going to be competitive with a Genesis.

Another factor that will probably help the cost equation on the C-Class is fuel economy. My 2012 3.8 gets about 15 mpg in city/suburban driving which is where I drive a good deal of the time. Given the extra weight and friction of the AWD with the identical engine and tranny, I am betting 12mpg will be the norm in city driving (my car does well on the highway). I will bet the C-Class will average in the low 20s at least in normal driving (and probably 30s on the highway) given the weight differential and torque curve of the 4. Also, MB seems to do this better. My friend's E350 (which is AWD and weighs a bit more) does much better than my Genesis and my wife's ML350 basically gets similar in town mileage and it weighs a (lardass) 5000 lbs with a 3.5 V6. The extra fuel economy is like an extra $20-30 discount on the monthly payment.

Disregarding the obvious size difference, when you consider (anticipated) features, quality, cost (or lease price since it is based in part on residual) and purchasing experience, does the new C-Class seem like it may be the equal or maybe a little better value than the new Genesis?

 

[PMCErnie]

The new C isn't out yet. Besides, who leases?!

 

[ksoze]

The new C isn't out yet. Besides, who leases?!

A large percent of MB and BMW are leases. Their financial programs are tuned for leasing with subsidized aggressively low residuals and interest rates. Also, many prefer not to own one of the german cars after the warranty ends, so a lease keeps costs low (or with BMAW, nothing) during ownership. They also then make a thriving business off the CPO market with those same returned leases.

 

[Aquineas]

I know this is counter-intuitive but listen to my argument and see if you think I am crazy. Also, I am making my comparison based on information I have read but not having seen or driven either car.

I like my 2012 Genesis 3.8. I was looking forward to the 2015. I like the looks and the interior of the 2015 and from the limited reviews, it is likely going to ride better than the old car. I live in the northeast so all of the 3.8s will be AWD (as will all of the C300s when they come out in Sept.). Overall I have had an OK experience with my 2012. The dealership experience has been OK but not luxury car good. I say this having just given back my second Lexus and leased a new 2014 Mercedes ML350 for my wife. It really is a different experience altogether.

I am thinking about this comparison because one poster make the very valid point that the ownership experience and resale value of the Genesis is likely to be lower than the luxury brands despite the Genesis being an equally good car in most respects.

Now I know it may seem like I am comparing apples and oranges but hear me out. First, from what I have read, the C300 is going to have 241hp/273 ft. lb. 4 cyl. power plant that is likely to accelerate as well or better than the Genesis (which is likely to weigh 4400+ pound in AWD form vs probably 3600 pounds for the Benz). Look at the performance figures for the 3 series with the base 4 and you see 0-60 times in the mid 5s. The C-Class has dropped weight in its newest version so I am betting numbers will be in the high 5s for the C300 AWD sedan unless they are over-rating the engine. Given the MT test, I am expecting 0-60 times for the 3.8 AWD to be in the mid 6s. And, unless they were able to completely re-tune the torque curve and the tranny, it will feel a little underpowered on the bottom end. I really like the 3.8 motor and when you hit it just right, it really moves. But bottom end torque is mediocre and it has a flat spot that drives me nuts sometimes. I know they 2015 is supposed to have a better torque curve but I am doubting it is going to make up for 400 extra pounds and the extra friction of AWD.

Now with the extended wheelbase the C-Class should have an adequately comfortable rear seat. The Genesis is a very roomy car and the C-Class will not come close; so if you are using the car for ferrying around a lot of tall people on a regular basis, the Genesis will be superior. However, MB is likely to ride well and be quiet (regular references in reviews are made to a shrunken S-Class) and the interior seems very nice and high quality in articles and pictures.

With the increase in price for the Genesis and proper optioning of the C-Class, I am thinking they will not be terribly far apart in price. I mentioned my wife's new ML350 because MB is really trying to make their numbers. Not only did they give $7000 off list and had good lease rates but MB also gives another $2000 off for membership in certain organizations such as the ABA, AMA, USAA, etc. I ended up getting her a $60k car for a lease price of $627 a month with just fees up front. I think they will keep the lease rates and general pricing competitive to keep volume up and I am betting the overall cost of a nicely optioned C-Class is going to be competitive with a Genesis.

Another factor that will probably help the cost equation on the C-Class is fuel economy. My 2012 3.8 gets about 15 mpg in city/suburban driving which is where I drive a good deal of the time. Given the extra weight and friction of the AWD with the identical engine and tranny, I am betting 12mpg will be the norm in city driving (my car does well on the highway). I will bet the C-Class will average in the low 20s at least in normal driving (and probably 30s on the highway) given the weight differential and torque curve of the 4. Also, MB seems to do this better. My friend's E350 (which is AWD and weighs a bit more) does much better than my Genesis and my wife's ML350 basically gets similar in town mileage and it weighs a (lardass) 5000 lbs with a 3.5 V6. The extra fuel economy is like an extra $20-30 discount on the monthly payment.

Disregarding the obvious size difference, when you consider (anticipated) features, quality, cost (or lease price since it is based in part on residual) and purchasing experience, does the new C-Class seem like it may be the equal or maybe a little better value than the new Genesis?

I can appreciate your arguments on value, and when you factor in the historically awful depreciation of the Genesis, one could argue that the discounted initial purchase price you pay for the Genesis you end up paying for later (particularly if you don't hold onto the car for a while).

It will ultimately come down to individual preference. If one prefers luxury and perceived refinement (which if I'm honest is me; I want a quiet, smooth, decent-handling car with all the bells and whistles that will pin my head back every once in a while, as opposed to a racer that can corner on a rail), I don't think the C-Class will come remotely close to the Genesis. When it comes to handling and driving dynamics, for many reasons (mostly due to weight), I think the C-Class will be better. I'll take the Genesis, tyvm.

 

[roblaw]

I am like you. I like features, ride and quiet. That is the reason I bought the Genesis and that is why I am thinking MB, too.

I really would not consider MB but for my recent lease. The Luxury version of the current C and E Class vehicles ride very nicely and handle decently. While I anticipate the new Genesis will ride well (especially compared to the first gen), I expect the luxury version of the C-Class to ride as well with either the luxury package (non-sport suspension) or the airmatic suspension option. The quietness is likely to be a draw as well. I never considered them because every review on a high end German car has the sport package and big wheels so they tend to ride very firmly. But if you get a base MB or BMW you will find the ride to be quite comfortable.

My wife's ML350 rides incredibly well and is extraordinarily quiet. She is coming from an RX350 and the differences are pretty stunning on the comfort side (farrrrrrr better seats, quiet and ride, things you thought a Lexus would excel at. The MB is far better). And while it is peppier and gets better MPG (and has been dead reliable) , it is clearly not as good as the ML350 at the comfort side.

So I agree with you but I am suspecting we both may be surprised by the new C-Class, and I, as a value conscious buyer, am going to at least give it a test drive and price it up after I check out the 2015 Genesis.

 

[PMCErnie]

A large percent of MB and BMW are leases. Their financial programs are tuned for leasing with subsidized aggressively low residuals and interest rates. Also, many prefer not to own one of the german cars after the warranty ends, so a lease keeps costs low (or with BMAW, nothing) during ownership. They also then make a thriving business off the CPO market with those same returned leases.

Yes, all too many people put themselves into cars that they really can't afford. The only way they can do so is by leasing the car.

I continue to believe that the advice given in this article is the best overall lifestyle advice for most folks. Yes, I do understand that some folks want to pay through the nose for all things in life.

http://auto.howstuffworks.com/buying-selling/buy-or-lease.htm

 

[ksoze]

That really depends. For those who only keep their cars for a shorter period, leasing can be attractive. If one can find a way to include it in their business, even more so. I agree however, it does allow those who cannot really afford the payments on an expensive car to own one, but it also can also work well for those who want to drive new cars more often and not worry about depreciation, maintenance and selling a car.

 

[PMCErnie]

That really depends. For those who only keep their cars for a shorter period, leasing can be attractive. If one can find a way to include it in their business, even more so. I agree however, it does allow those who cannot really afford the payments on an expensive car to own one, but it also can also work well for those who want to drive new cars more often and not worry about depreciation, maintenance and selling a car.

Sure, it's a no-brainer for business owners to lease. But most folks don't fall into that category. The bottom line I am looking at is that it is always more expensive to lease. A car purchase is just one of life's many necessities. It just makes no sense to me to cripple yourself financially to drive a fancy car when you are sitting in a rental apartment. I feel especially bad for younger folks since it will take many years for them to learn such life lessons.

 

[ksoze]

The bottom line I am looking at is that it is always more expensive to lease.

Not to prolong this debate, but leasing can be advantageous in cases for those who change cars frequently. If you like to own and chnage cars at two or three years, leasing can be better.

 

[PMCErnie]

Not to prolong this debate, but leasing can be advantageous in cases for those who change cars frequently. If you like to own and chnage cars at two or three years, leasing can be better.

Better only for the short term and one purchase. Continuous, consecutive, leasing can be exponentially expensive as the Edmunds article above explained. Financially speaking, nothing is better for your wallet than buying a car that you can truly afford and keeping it for a sensible period of time. These days, any good vehicle should go 6 years plus without a major hiccup. Sure, many folks think they need the latest and the greatest, but they are doomed to pay through the nose for that privilege. Few people can actually afford this luxury and some other aspects of their lives will suffer, in IMHO.

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[tompass]

When I looked at the '14 E350, sales rep told me the '15 C was going to be built on the E frame so should be larger the the current C. I loved the E350 coupe but very small as it is built on C frame.

 

[Mark_888]

That really depends. For those who only keep their cars for a shorter period, leasing can be attractive. If one can find a way to include it in their business, even more so. I agree however, it does allow those who cannot really afford the payments on an expensive car to own one, but it also can also work well for those who want to drive new cars more often and not worry about depreciation, maintenance and selling a car.

If you buy (not lease) a car and use it for business, the depreciation on the car is tax deductible. If it is used part for business and part for personal use, the depreciation is pro-rated just like it would be for lease costs. It is a myth that leasing provides more tax breaks. The only issue is that it makes the tax reporting a bit more complicated, but it is easy if you use a program like Turbo Tax that does all the work for you in figuring it out.

 

[ksoze]

I am not an accountant and you may be, but I thought both lease and buy are eligible for depreciation, but leasing payments are tax deductible (based on percentage use of car for business) where only the interest on the car loan is deductible as a business expense.

 

[Mark_888]

I am not an accountant and you may be, but I thought both lease and buy are eligible for depreciation, but leasing payments are tax deductible (based on percentage use of car for business) where only the interest on the car loan is deductible as a business expense.

If leasing, one may deduct the lease cost (or that percent of the lease cost that is attributable to the percent of business use), but then you cannot deduct any depreciation expense. That would be double-dipping. In fact you can't even deduct depreciation instead of deducting lease expense since you don't own it (the leasing company is taking depreciation expense on their tax return).

If one purchases a car, both depreciation and interest expense (if a loan was obtained) are tax deductible (pro-rated for percent of miles used in the business, if applicable).

As an alternative to either of the above, one may deduct $0.56 per mile for miles driven for business use (2014 IRS rate). This rate includes everything, including maintenance, insurance, etc.

 

[Mark_888]

Here are the applicable IRS rules about depreciation of leased assets:

Leased property.
You can depreciate leased property only if you retain the incidents of ownership in the property (explained below). This means you bear the burden of exhaustion of the capital investment in the property. Therefore, if you lease property from someone to use in your trade or business or for the production of income, you generally cannot depreciate its cost because you do not retain the incidents of ownership. You can, however, depreciate any capital improvements you make to the property.

If you lease property to someone, you generally can depreciate its cost even if the lessee (the person leasing from you) has agreed to preserve, replace, renew, and maintain the property. However, if the lease provides that the lessee is to maintain the property and return to you the same property or its equivalent in value at the expiration of the lease in as good condition and value as when leased, you cannot depreciate the cost of the property.

Incidents of ownership.
Incidents of ownership in property include the following.

• The legal title to the property. [this is the killer]
• The legal obligation to pay for the property.
• The responsibility to pay maintenance and operating expenses.
• The duty to pay any taxes on the property.
• The risk of loss if the property is destroyed, condemned, or diminished in value through obsolescence or exhaustion. [if you lease a car, you do not retain risk of loss if car is diminished in value at end of lease]

http://www.irs.gov/publications/p946/ch01.html

 

[sandy]

Better only for the short term and one purchase. Continuous, consecutive, leasing can be exponentially expensive as the Edmunds article above explained. Financially speaking, nothing is better for your wallet than buying a car that you can truly afford and keeping it for a sensible period of time. These days, any good vehicle should go 6 years plus without a major hiccup. Sure, many folks think they need the latest and the greatest, but they are doomed to pay through the nose for that privilege. Few people can actually afford this luxury and some other aspects of their lives will suffer, in IMHO.

Following your logic, why buy new? You could probably make a similar argument for buying used vs. new, especially a CPO which reduces the repair risk. You are obviously a communist against the American Way of Life.

 

[Mark_888]

Following your logic, why buy new? You could probably make a similar argument for buying used vs. new, especially a CPO which reduces the repair risk. You are obviously a communist against the American Way of Life.

I think the explanation is that leasing causes people (on average) to get a new car more often than they ordinarily would (even if it is a few months difference). That is what makes leasing more expensive in the long run. But if you are sure that would get a new car on the same exact schedule as if you leased, it might not make much difference.

Some people lease because the don't like the hassle of getting rid of their old car and don't like being held hostage by a new car dealer for the trade-in value given. But there are a lot more options these days, such as Car Max, which will offer to buy a car on the spot.

 

[sandy]

Not to prolong this debate, but leasing can be advantageous in cases for those who change cars frequently. If you like to own and chnage cars at two or three years, leasing can be better.

I agree. If you want to drive a new car every 2 or 3 years, the cost of leasing is just about the same as buying and trading. If you are looking for the most economical way, buy a used car with a good warranty and not a fancy car like a Genesis, and one that gets at least 30 mpg. You can also eat at home instead of going to restaurants, etc, etc. Different people have different priorities, everybody should do what makes them happy.

 

[PMCErnie]

Following your logic, why buy new? You could probably make a similar argument for buying used vs. new, especially a CPO which reduces the repair risk. You are obviously a communist against the American Way of Life.

Sandy, Sandy. I didn't suggest that folks need to live in a cave to save money. We were discussing new cars and my logic wasn't directed toward a new/used purchase decision. Of course it could be and you are correct. There is no question that avoiding that nasty new car depreciation can be a good purchasing decision. For example, I bought our '09 Ford Taurus (aka Five Hundred) used and saved a bundle. I wasn't looking for a used car but my wife wanted that particular model and that exact color. It's a tank with the huge trunk and SUV-like seating height.

Yes, given the complexity of vehicles these days, I am convinced that buying an extended warranty, or getting a CPO warranty, is a critical thing to do if keeping the car beyond 3 years, in the case of Hyundai.

Me, a Communist? Well, it is true that I am half East German descent, but I also spent my US Army years as a spy in Berlin. In that respect, I guess I am double agent. ,-) I am also half Scottish.

By the way, folks who seriously want to get wealthy should read the book "The millionaire next door." It's a bit dated now, but the concepts remain the same and are solid rules to advance your wealth. Accumulating wealth is just as much about saving money as it is about making money. Here is your free copy:

http://davidbeitler.com/temp/The Millionaire Next Door [Book]-MANTESH.PDF.pdf

 

[Mark_888]

I agree. If you want to drive a new car every 2 or 3 years, the cost of leasing is just about the same as buying and trading. If you are looking for the most economical way, buy a used car with a good warranty and not a fancy car like a Genesis, and one that gets at least 30 mpg. You can also eat at home instead of going to restaurants, etc, etc. Different people have different priorities, everybody should do what makes them happy.

Whoa!! You missed on option.

Some people may want (and can afford) to buy a new car whenever they want to on their own schedule, and not an arbitrary number of fixed months based on when the lease is up. Also, because they don't drive a lot of miles, they typically keep their cars for a longer period than most leases. These same people want to buy a new car each time, and may want to buy a fancy car like the Genesis each time, and like to eat out restaurants frequently. It is not as black and white as you suggested.

These days I drive a car less the 7,000 miles per year, so I would likely keep it at least 5-6 years, unless there was something wrong with it or I no longer liked the car. I have only purchased new cars (not used) since I graduated from college, and have paid cash for them since 1987 when interest expense was no longer tax deductible. I have been luckey and/or wise in my purchases, and take care of my cars, so they have generally held up mechanically very well. I also don't need to get a new car more often just to advertise that I could afford to if I wanted to, because I don't really care what others think about that.