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Lease negotiation

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Old May 19, 2014 | 02:40 PM
  #1  
FLKeith's Avatar
FLKeith
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From: Florida
Lease negotiation

I had an interesting exchange with a dealer outside my area trying to get a lease on a 2014 Paceman. This dialog shows just how far dealers will go to make money off a lease...

The published special for a Paceman S is $214/month for MSRP $28,945. I asked for the price on a $38,652 configuration.

The first number given was around $550/month. I was so stunned that I didn't write down the exact number! I asked them to go through the lease details as there was no way that number made sense. I was told the residual was 60% but I knew the trade-in on the online promotion calculates out to 62% so I asked them to go through it and make sure they were applying the terms from the special being promoted.

The next number was $469/month. This time the explanation was that not all the discounts listed in the online promotion could be applied to an ordered car. I still didn't accept it because you don't get to this number even by excluding all the you-ification and other discounts so I asked exactly what discounts were being excluded.

The next number was $352/month. This is where I expected the negotiation to start because this is what you get by applying the terms of the online promotion to my spec. Unfortunately it is where my conversation ended.

The whole conversation was very disappointing as it showed they tried to squeeze $200/month out of a published deal. That is $7k in extra dealer profit!
 
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Old May 19, 2014 | 04:22 PM
  #2  
afadeev's Avatar
afadeev
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From: NYC
Originally Posted by FLKeith
I had an interesting exchange with a dealer outside my area trying to get a lease on a 2014 Paceman. This dialog shows just how far dealers will go to make money off a lease...

The published special for a Paceman S is $214/month for MSRP $28,945. I asked for the price on a $38,652 configuration.

The first number given was around $550/month. I was so stunned that I didn't write down the exact number! I asked them to go through the lease details as there was no way that number made sense. I was told the residual was 60% but I knew the trade-in on the online promotion calculates out to 62% so I asked them to go through it and make sure they were applying the terms from the special being promoted.

The next number was $469/month. This time the explanation was that not all the discounts listed in the online promotion could be applied to an ordered car. I still didn't accept it because you don't get to this number even by excluding all the you-ification and other discounts so I asked exactly what discounts were being excluded.

The next number was $352/month. This is where I expected the negotiation to start because this is what you get by applying the terms of the online promotion to my spec. Unfortunately it is where my conversation ended.

The whole conversation was very disappointing as it showed they tried to squeeze $200/month out of a published deal. That is $7k in extra dealer profit!
Sorry about a near-rip-off experience.

But it is worth noting that buying a car is a zero sum game between you and the sales guy: there is no such thing as a long-term customer+dealer relationship, so it is in their interest to maximize the profits from each transaction. They are not evil, just logical. And more experienced than you at the game.

Come prepared, stick to your guns, and you can drive off with invoice + $500 markup for the dealer. The more variables you introduce (trade in, fees, lease), the more room you give the dealer to battle you over the final price to you and profit to them.

Just come prepared.
It is YOUR job to know the invoice pricing and extract it from their clinched teeth.

a
 
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Old May 20, 2014 | 08:35 AM
  #3  
emilyanny4u's Avatar
emilyanny4u
2nd Gear
Joined: Apr 2014
Posts: 149
Likes: 1
From: Green Bay, WI
I had the same issue with my 2014 lease F56 MCS and to be honest I flat out told them that their numbers did not make sense. That made them change their tune fast. They started throwing discounts at me then $500 for this $500 for winter tires blah blah. Just do not take what they tell you as face value. Fight for what you think is fair.

Good luck on your car shopping!
 
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