One of the electric cars that I was eagerly awaiting was Jaguar’s I-Pace. I visited a local dealer one weekend when they had one on loan to show off; I went for a test drive in it at the San Francisco car show last year. And it was great. In fact, of the three cars I had been watching from the day their concepts were announced, the Jaguar was the only one that stayed true to the concept car in my mind.

Reviewers around the world also love it, and while its lower than expected range was a disappointment, it is still over 200 miles between charges, and it is capable of 100kW charging (if you can find a charger capable of delivering that).

Yet sales, even from the start, seem to be slow. When I first asked the dealer, they didn’t expect to have any available until early 2019 for those that had not pre-ordered. Just a few weeks after launch, they called to say they did have some in stock for immediate purchase, and that has been true every time I’ve checked their website. In fact, all the dealers here have them in stock. So what is wrong?

Lease

Aside from my current EV (which I bought used purposely to avoid a lease term), the last few cars I’ve had have been leased. If I was to buy the I-Pace, I would almost certainly look to lease it too. This is where I think it is falling down though.

Here is an offer I received recently for leasing an I-Pace. They have already cut the price on this by $7,000, and then they take $12,400 in down payment ($4,900 in cash and $7,500 from the federal tax rebate, which typically gets applied like this when leasing an eligible EV). After that, a 7500 mile/year lease is $1,089/month (pre-tax).

That seemed vary high to me, even for a $76,000 car (which is really just a $68,500 car given that rebate). It works out at $17,200 per year, amortizing the down payment over the 36 month lease term.

As luck would have it, the same email included a lease for another luxury SUV at a similar price:

So, here’s a car that is around $4,000 more expensive, has a lease down payment of just the $4,900 since it is not eligible for the $7,500 EV credit, and yet has a monthly lease payment $90 lower than the I-Pace. Amortizing that down payment the same way, this slightly more expensive vehicle works out at just $13,600 per year – $3600 per year cheaper than the EV.

Low Residual?

The email did not provide the residual for each lease, but given everything else was the same, I can only assume Jaguar (or the finance people behind their leases) are not confident of the resale value of these cars after the three years and have set the residual value very low.

A similarly priced Mercedes (the larger GLS 450), is just $899/month with $5,000 down, making it even cheaper than the Range Rover.

At these prices, it is not very surprising that Jaguar are not selling many EVs in the US. They’re pricing themselves out of the market.