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More than the $30, it's just an illustration of how the process continues to be structured to squeeze that last dollar out. If they slipped $30 past my fine-toothed comb, one can only imagine.
Had it been $300, and somehow I hadn't noticed, you bet I'd be on it. And that's how they do it. Nickels and dimes. They add up.
I recently watched a Grant Cardone video where he discusses price/value. He gives an example of a piece of real estate he sold for $17MILLION. The buyer owned the property next door and wanted to buy Cardone's $17M property as a tear down so he could expand his estate. The buyer tried to grind on price, claiming the property wasn't worth $17M. Cardone agreed with the buyer and flat out told him paying $17 million would be paying too much based on the market value of the property, but that was the price. The guy bought it for $17 million.
What can we learn here?
Well, many things cost more than they are "worth." Especially new cars. ESPECIALLY new MINIs. After a year, most new MINIs lose over 20% of MSRP, usually more, even if the mileage is low. My 2017 Clubby was worth less than half of MSRP 3 years and 20,000 miles after initial delivery.
So, dealers have us there. They know we WANT the car. That desire is what allows car dealers to charge the premium.
The smart car salesperson doesn't push the value proposition too hard. The most successful car sales people know the right moment to ask, "So, do you want to buy this car?" If the customer replies, "If the price and terms are right, I'm willing to buy it today," the wise salesperson hears "Yes, I want to buy this car." And that's why car deal negotiations can get complex.
The thing to remember is that, because you want the car, the dealer already understands this, and has priced in a nice surcharge to cover the cost of your desire. Trust me on this. My wallet has been pried open many, many times not because of need, but because of desire.
outside of the collector/speculation market, few if any cars hold their value that well in the first year.
20% is generous. 28-33 is normal.
Take as an example one of the best-selling vehicles in America, the Ford F-150 pickup. It sells new for $50,154, on average. In the first year, the truck depreciates by $14,349, losing 28.6 percent of its value. The next year it loses much less: $2,440, or a 6.8 percent drop in value. The third year is even less painful: The F-150 depreciates by $1,690, a 5.1 percent drop in value.
At the four-year mark, however, the depreciation takes a sharp dip. The truck loses $4,765 of its remaining value, or about 15 percent.
The results of our lease end inspection resulted in a $300 charge for parking lot scrapes to the left rear and $350 for a chipped windshield. The final statement was $650 + tax = $706.88.
A call to MINI Financial resulted in an offer for a 20% discount credit on the bill. $141.38. That's a start.
After thanking the agent for his courtesy, I asked if, as a returning leasee, we could do a little better. He said he was at his authorized maximum but offered to transfer me to the lease end department.
Had a friendly chat with the second agent. Talked about the weather they've been having in Ohio and other interesting stuff.
End result: $320 credit given, reducing the amount due from $706.88 to $386.88, plus we received a $300 under mileage credit which will reduce our next lease payment by that amount and, of course, the $350 lease return fee is waived for anyone who leases again through MINI or BMW.
When the agent came back on the line and thanked me for waiting patiently on hold, I replied that I was happy to wait for good news and that I appreciated his efforts on my behalf.
He said, and I kid you not, "We try to make an extra effort for polite customers."
YMMV, but start out, and stay, courteous throughout any car negotiation. Even after you've turned your leased car in, there's often a few hundred hiding somewhere.
$320 for 15 minutes of friendly phone work from the comfort of my home. Not a bad hourly rate, IMHO.
Courteous phone behavior is usually a winner. In person contact can go either way, sometimes the kindness in person is looked upon as weak and you need to be firm and nasty.
We lucked out with our turn in on our 2016 and the lady (a senior MA) who handled it ran her finger over a minor scrap on the bumper, I shrugged it off and said it is a used car and your detail guy can buff that out in 2 minutes. No charges to haggle with.
All in all I'm not a fan of leasing simply because I never feel like it is my car and therefore reluctant to do any real mods to it. Probably keeps me driving it saner, but what fun is that?
For October, MINI USA reported 2,962 vehicles sold, a decrease of 6.4 percent from the 3,166 in the same month a year ago.
MINI Certified Pre-Owned sold 877 vehicles, a decrease of 10.8 percent from October 2018.
Total MINI Pre-Owned sold 2,154 vehicles, a decrease of 6.5 percent from October 2018.
As December comes upon us, in much of the country the weather reduces dealership traffic. People are spending $$ on holiday gifts and travel and, unless that gift is a new car (I've done that before), it gets pretty slow at MINI dealers.
End of quarter, end of calendar year. If you're even thinking maybe, start staking out your vehicle, and, if you can pull it off, between Christmas and New Years Eve is the time. If there's anything extra a dealer can do to close a deal, that last week of the year is often when that "anything extra" happens.
For November, MINI USA reported 3,067 vehicles sold, a decrease of 13.1 percent from the 3,528 in the same month a year ago.
MINI Certified Pre-Owned sold 952 vehicles, a decrease of 2.0 percent from November 2018.
Total MINI Pre-Owned sold 2,367 vehicles, an increase of 7.7 percent from November 2018.
Six years ago, my spouse went shopping for a new car. She gave me some criteria, and I gave her a list of cars that fit which she should check out. To my surprise, the Countryman R60 fit the criteria so onto the list it went.
We went test driving. She drove the Countryman first. After that, everything else, from Subaru to VW, was just boring! So back to the MINI dealer we went, about a week before Christmas. A new 2014 had just come off the truck. We bought it. We got a good price. Dealer was pleased to make a sale in the last weeks of the year. Six years later, that car is still going strong.
If you're shopping for a car, this is a fine time to be shopping for a MINI. Sales are down, dealers are motivated as hell. So read 2017All4's advice, and go shopping. :-) Our 2014 R60
Last edited by bratling; Dec 10, 2019 at 01:32 PM.
Reason: added photo
Local dealer has a bunch of 17 Clubman's coming off use as rental cars. Seem like decent deals for someone. I'd probably look at one but considering moving in 2020 and don't know exactly what my needs will be and parking/garage space, etc.
Wonder how the SEC looking at BMW sales practices will shake out for MINI? Stay tuned.
Here it is folks. All the bad news that's fit to print!!
For December, MINI USA reported 2,310 vehicles sold, a decrease of 17.4 percent from the 2,797 in the same month a year ago. For the full year 2019 MINI sales decreased 17.4 percent on total sales of 36,092 compared to the 43,684 vehicles sold in 2018.
MINI Certified Pre-Owned sold 930 vehicles, a decrease of 5.9 percent from December 2018.
Total MINI Pre-Owned sold 2,341 vehicles, a decrease of 4.9 percent from December 2018.
That's unfortunate news. And every time I see that table, I chuckle that the X1 and X2 are considered cars, not trucks.
The only thing that makes me chuckle is how steadfast MINI of Portland holds to pricing when sales suck. They probably do a lot better than most MINI dealers due to us Portland oddballs and lack of nearby competition. But still, two of my family have gone VW instead of dealing with MINI on sales or service or price. I'm the lone holdout and probably won't last.
For those who started deals in the past week or so but have yet to take delivery, CHECK THE NUMBERS WITH GREAT CARE, as rates and other terms changed as of 1/06/2020. And they didn't go down!!
If leasing, ask lots of questions about lease money factor, incentives, and residual percentage.
If purchasing with MINI financing, ask about interest rate and incentives.
It can be tricky on ordered cars as some things can be locked and others can't.
Go over EVERYTHING with great care.
If the deal negotiated last week was $400/month with $1,000 down, and tomorrow the numbers are higher, remind the salesperson of the deal terms you agreed to. Hang tough.
And yes, it is interesting, with the MINI dismal sales numbers, that MINIUSA is increasing the cost to lease or own.... yet again. One assumes the target demographic has shifted. If they're not careful, it will fall off the radar all together, IMHO.
Some of the greatest dollar savings on car deals are achieved by purchasing a unit from dealer inventory that the Sales Manager needs to move. Slow movers sometimes have additional manufacturer-to-dealer incentive dollars tucked away "in the trunk" which the dealer can apply to sweeten the deal. If you want the most possible savings and you're not that particular regarding specific color or features, then simply asking the Sales Manager, "Which car on this lot can you make the absolute best deal on?" might save you a bit more.
However, we are MINI enthusiasts here. We spend hours and hours learning every option, every statistic, every feature of these cars and, usually, we construct in our mind the exact MINI we want.
So, if you're not in the "sell me the car you can give me the most savings on and just get me done" group, then the challenge is how to get a very aggressive deal on the MINI of your dreams. Which, starting from the first post on this thread, is what we're all about trying to figure out here.
If you want a killer deal on exactly the MINI you want, whether you need to special order the car or search and search until you find it, then you need to do a lot of homework.
1. Know the numbers. Learn the MSRP and the invoice and all available rebates and incentives for the MINI you want.
2. Build a spreadsheet or get out the calculator and crunch the numbers hard.
3. Contact several dealers if you can, or, if you're in a one dealer region, get on the phone to the Sales Manager and present them with a low offer by saying these magic words: "I have found the car I want in your on line inventory (or, "I haven't been able to find the MINI I want in your inventory so I built one on the web site and I'd like to send you the build.") Then, "I've done some preliminary calculations. If you can deliver the MINI I want for $xx,xxx out the door, I'm ready to come in today and sign the deal."
4. If you have a trade, you can say, "When I come in I'd also like you to evaluate the value of my 2006 Belchfire to help me decide the best way to realize the most value from my trade."
All of this assumes your credit or cash is good and you are, in fact, ready to do the deal if the numbers are right.
On my first MINI deal in 2016, I called the Sales Manager at the second MINI dealer I contacted, and told him, straight up, the truth, which was that I had just walked out of MINI of XX because "I was ready to do a deal but they couldn't meet my needs. Here are the numbers I am ready to say yes to right now." I emailed the Sales Manager at the second dealer my custom build along with the exact numbers I was prepared to say yes to. He called me back and said we have a deal. He emailed me a credit app and a Vehicle Inquiry Report listing the details on the build I wanted. He asked me to carefully review the build and sign it and sign the credit app and transmit them back to him. I did it and a few weeks later I got a call saying my car was at the port. A few days later, we went in, met the Sales Manager for the first time, signed the paperwork, and drove home in our new Clubman.
On our most recent MINI deal, the same Sales Manager told me the best he could do, which was $500 over invoice before incentives, which, after snagging a non-publicized extra $500 incentive, took the deal to net $1,500 below invoice. Normally I'd have ground a little harder, but he got us the one-off special color we wanted and he snagged the extra $500 incentive which required some dealer paperwork and, generally, made it smooth and easy.
The MOST IMPORTANT factors, whether you buy off the dealer's lot or special order, are to be ready to deal, to be straight up, and to always be courteous and professional. Those who are ready to deal get the best deals. And, right now, though published incentives aren't super aggressive, there are good deals to be had. YMMV.
This week I got a form letter from my local dealer offering around $2200 incentive. I’m sure that is for the most expensive models but still... they want our money!
This week I got a form letter from my local dealer offering around $2200 incentive. I’m sure that is for the most expensive models but still... they want our money!
They are definitely trying to figure out how to manage marketing going forward. It's getting harder to follow -- the MINIUSA website is certainly not the final authority on what's out there. Regional stuff, individual dealers doing their own thing.... one rule remains the same, grind hard! And watch all the numbers.
This week I got a form letter from my local dealer offering around $2200 incentive. I’m sure that is for the most expensive models but still... they want our money!
In the process of ordering/building a new F56 and was offered $2000 off the MSRP without even asking. I was pretty pleased with the trade for my R56 as well.
There is a term in cardealerspeak that describes the illegal padding of a monthly payment quote. It's known as a "leg."
The way it works is this. A sales manager works out a deal sheet and lists the selling price of the car at $2,500 cash down and $400/month for 60 months.
What the sales manager has failed to disclose is that the $400/month payment is $20 higher than it needs to be to cover the agreed upon selling price of the car. This results in an extra $1,200 "leg" that the finance office can use to load in some extra add-ons, like an extended service contract or tire and wheel protection or the "platinum package" bundle of everything from sealer wax to an extended warranty.
Then, the unsuspecting customer enters the finance office to finish the paperwork and the finance manager goes through a carefully rehearsed pitch ending with the "good news" that this $1,800 Platinum package can be folded into the deal for "only $10 more per month." The customer whips out his calculator and quickly computes that the $1,800 Platinum package is only gonna cost $10 times 60 months or, only $600, and, realizing this is a great offer, surprises himself and says, "I'll take it."
The illegal part is that $1,200 was added into the deal on the front end to cover $1,200 of the $1,800 full retail price of the Platinum package -- the $600 plus the $1,200 hidden leg means the customer is paying the full $1,800, plus interest for a package that costs the dealer maybe $900.
Yes, it happens. Know your interest rates. Calculate what the payment should be based on the out the door price. Don't let them get a leg up.
BTW, I saw an article that said the Oxford edition is now available to any U.S. customer, no exclusions. That is an EXCELLENT deal. It has me thinking a lot.
We all need to take the Coronavirus situation very seriously, observing excellent personal hygiene, limiting direct contact with others when possible, and keeping in the forefront of our minds the reality that contagion spreads because individuals spread it. If everyone would hunker down for a couple of weeks, the longer-term economic impact for all of us would be diminished and the infection curve could be flattened out sooner rather than later. Do your part.
Which brings us around to car deals on new MINIs. The current situation cuts two ways. Dealership traffic is at a near standstill. So any customer is a very welcome customer indeed. However, when sales volume drops off a cliff, some dealers find it more challenging to offer deep discounts because they have fewer sales through which discounts can be offset. And it becomes harder for a dealer to hit sales goals that unlock manufacturer incentives. Yet, when sales are slow, any sale is a welcome sale, especially if it results in moving expensive inventory off the lot and off the dealer's books.
So, on the one hand, now might be a good time to test how much a dealer will pay you to take a car off his/her hands. On the other hand, dealers need to squeeze every dollar they can out of scarce sales.
Production of new vehicles, especially in Europe, is grinding to a halt. Surplus inventory has piled up and factories full of people are exactly where public health officials think there are virus spreading nightmares. And, of course, parts suppliers have also interrupted production world-wide, creating parts shortages that force interruptions in just-in-time production systems that don't have deep supplies of parts on hand. There will be more shutdowns.
Domestic manufacturers like Ford and GM are, reluctantly, ramping up incentives this month. The UAW is pushing for factory closures to stop the spread of illness.
Foreign makes will soon be forced to join the "race to the bottom" because if a domestic is deeply incentivized, the foreign makes have to compete on price and terms -- a customer might want a BMW, but if the latest from Cadillac is thousands cheaper than that Bimmer, some folks will walk across the street to snag the better deal.
MINI is trying very, very hard to resist "cheapening" their brand during a time when their strategy has been to push MINI upmarket. But we can be fairly confident that, even if up front cash incentives aren't growing, there will be quiet moves behind the scenes wherein MINI slides secret support to struggling dealers. That support, if and when it materializes, can sweeten deals for savvy buyers.
If you're shopping for a MINI, then the best deals will be on cars already in dealer inventory. Custom orders might require a bit more grinding to get equally good deals and there is always the risk that a custom ordered MINI might not be built quickly due to parts issues or other production interruptions. In any case, if your shopping for a new MINI, make a low offer -- test the bottom.
Finally, dealers have more incentive than ever to deal with customers via phone, text, or internet communication. It is difficult for dealers to push customers to come to dealerships during a time when people are being urged to shelter in place and not go out. If Nordstrom is closing retail locations nationwide, then car deals can be negotiated from the comfort of customers' homes. This gives the customer additional leverage because, if the dealer doesn't have you trapped in his/her office, then you are nothing more than a disembodied voice on the phone, in complete control of any negotiation.
We know all the strategies (and tricks) dealers employ to disempower customers. In this terrible moment of public health crisis, if you're in the mood to motor in a new MINI, find the opportunity. It's out there.
And do all you can to keep yourself and others well!!
