Why are Grand Cherokee 4XE so expensive to lease?
I was recently looking at some pricing on leasing the brand new plug in Jeep Grand Cherokee and was surprised to see that most cars are leasing in the 700s, even after the $7,500 federal rebate, so I wanted to know - why are they so expensive?
Some background on the Grand Cherokee 4XE
The Grand Cherokee model has been a staple in Jeeps lineup for 20 years now. In 2022, the company started focusing on introducing plug in models as part of its lineup, first with the Wrange 4XE. Those cars quickly came in high demand so the 4XE trim was expanded to include the Grand Cherokee shortly after. When released the starting MSRP on these cars was $62,000, which now has slightly decreased to just over $60K for the 2023 model year. This is a huge jump over the base Grand Cherokee that starts at just $41,530.
What is the lease price difference between a regular Grand Cherokee vs the 4XE?
Using Jeep’s configurator on their website, base model lease for a fairly well equipped Limited model is around $370 a month, assuming a 10% down payment. For a base level 4XE that number jumps to over $570, also assuming a massive 10% down payment of over $10k.
If someone does not put a 10K down payment, the price quickly balloons to 800 or more, depending on the spec and MSRP of the car.
Why are 4XE leases so expensive?
Jeep has done an interesting thing when launching the 4XE trim, they only included it on the most expensive Grand Cherokee models. The trim levels that come with the 4XE are Summit, Overland, Trailhawk, and Summit Reserve. This means that we are taking what is already a close to 55K car and increasing the price to well over 70K in most cases. Dealers are also not discounting these and the only savings people can rely on are regional incentives or loyalty and other similar offers.
How does the $7,500 tax credit impact lease price?
When leasing any car, the $7,500 credit goes towards your lease, which is phenomenal value. It leads to a lot more savings than if you purchase a car and get the rebate. When you lease, the $7,500 is applied to our lease amount, which in the Grand Cherokee case is 40% of the car’s value. That means you are saving close to 20-25% of your finance amount via the incentive. However, this means that dealers are less likely to negotiate on the price as much as they would on other cars. They try to show the $7,500 credit as already a significant discount on MSRP and offer minimal flexibility on price
Would I recommend leasing a GC 4XE?
Right now I would stay away from this car. If you are looking for something electric or fuel efficient you have a lot of other and cheaper options. Even a Tesla Model Y is going to be a lot less than the 4XE. The regular Grand Cherokee models offer the same basic features for $20K less than the 4XE, so you are paying a lot of money for only 30 miles of electric range. If you are in the lease market, $800-$900 can get you a lot of other car options that in my opinion offer more luxury or are more unique than the Jeep.
If you want to get a Grand Cherokee, stick to the non electric models.