Analysis: Why The Wrangler JL Is $1 Cheaper To Lease Than The JK

[Jeepster2018]

https://www.carsdirect.com/deals-ar...wrangler-jl-is-1-cheaper-to-lease-than-the-jk

New vs. Old
This month, the old JK Wrangler Unlimited Sport is listed at $284 for 36 months with $2,499 due at signing. It comes with an allowance of 12,000 miles per year and is based on an MSRP of $30,390.

Based on our analysis, its effective cost comes out to $353/month.

However, at the same time, the new JL Wrangler Unlimited Sport is listed at $283 for 36 months with $2,499 at signing. That's based on an MSRP of $33,690, with the exact same mileage limit.

The effective cost of the all-new Wrangler? $352/month. That's a $1/month advantage for a completely updated vehicle with an MSRP that's $3,300 higher.

So why is this the case?

Numbers Game
Unlike most other Jeeps, both versions of the Wrangler aren't eligible for any sort of lease cash incentives. Both feature the same money factor of 0.00193, which equates to an interest rate of 4.6% APR.

Based on our analysis, the key difference has to do with the underlying residual values.

The lease for the JK Sport is based on a residual of 71%, an impressive amount for any vehicle. For some perspective, a 2018 Camry SE has a residual value of 55%.

The reason the JL Sport equates to a superior lease is that it's based on a residual of 75%, the highest out of any other JL style.

Not Every JL Is A Great Deal
Unfortunately, not every JL Wrangler equates to a stellar value. Residual values vary by style and heavily favor the 4-door Unlimited models. Here's an example.

At the moment, the two-door JL Sport (MSRP $30,190) is listed at $322 for 36 months with $2,499 at signing, with an effective cost of $391/month. It's based on a residual of 66%.

That means the 2-door is $39/month more to lease than the 4-door even though the 4-door costs an extra $3,500.

So should you lease a JL Wrangler?

Based on what we're seeing, choosing the previous generation may not offer much of an advantage if you're comparing advertised offers. As a result, choosing the latest and greatest could be a smarter choice under some circumstances.

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[JL Rubi Khan]

Do they lease the Rubicon editions? I didn't even bother to check when I bought mine, but am just curious

 

[TXRubicon]

Yep.

Do they lease the Rubicon editions? I didn't even bother to check when I bought mine, but am just curious

 

[BBQCHICKENALERT]

Great and informative post!

Just to expand on this subject a tad -

I went to a local Jeep dealership and sat down with the finance manager to run some numbers. What he told me was that the JL Sport and Sport S do indeed lease out really well. The high residual value is the reason for it.

However, he said that if I am in the market for a JL Sahara or Rubicon he does not recommend leasing. They have lower residual values placed on them. The lower set residual values for the higher end models means that a hypothetical $41,000 Sport or Sport S will lease at a discount relative to a $41,000 Sahara or Rubicon. This is very strange and counter intuitive if you think about it because the actual used car value after 36 months will most likely favor the Sahara and especially favor the Rubicon models.

Also something else to note. At the dealership I was at, the Sport S models were all listed on the window stickers as JL Wrangler Sport and the S designation was more of an option package rather than a completely separate model. The Build & Price layout on Jeep's website would have you think otherwise. Therefore, the lease rates benefit both the Sport and Sport S models.

All this makes sense from a business standpoint. Sahara and Rubicon models target more affluent or loyal Wrangler buyers who will most likely purchase the vehicle outright and are less affected by swings in price/monthly payment. Sport and especially Sport S are their volume sellers and the favorable financial metrics will help push sales on people who are on a budget and cross shopping with different vehicles.

 

[Renegade]

It's all about the residuals...

 

[Jeepster2018]

Don't believe it's limited to any specific trim levels however I do question if a Rubicon is used for which it is intended what is considered normal wear and tear under leasing terms?

Do they lease the Rubicon editions? I didn't even bother to check when I bought mine, but am just curious

 

[Jeepster2018]

Yes, because based on cost, the Sport S is a better value, will have less depreciation due to the lower initial cost, resulting in the best leasing rate.

Great and informative post!

Just to expand on this subject a tad -

I went to a local Jeep dealership and sat down with the finance manager to run some numbers. What he told me was that the JL Sport and Sport S do indeed lease out really well. The high residual value is the reason for it.

However, he said that if I am in the market for a JL Sahara or Rubicon he does not recommend leasing. They have lower residual values placed on them.

 

[Jeepster2018]

Exactly which makes the Sport S the Best Value,

It's all about the residuals...

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