Our local BMW dealership in Scottsdale, AZ has several courtesy/loaner X1’s for sale/lease and just got a reply back on the deal they are offering. Typical dealer BS with inflated MF and so-so discount. Curious to know what you (Hackers) think would be a good counter offer, would be nice to get the MF down to less than 2% and I would think at least 18% off MSRP would be possible? Most of the cars have less than 2,000 miles. Thanks in advance. P.S. I know BMW is offering dealers some incentives on these courtesy cars so that should help some.
2017 BMW X1
$40,454 - MSRP
$37,171 - Sales Price (their listed offer)
58% residual for 36/15k
.00191 - MF
This is a generic copy + paste answer to your question about how I can get a better deal.
SELL PRICE SELL PRICE SELL PRICE.
Remember that dealers make money based on the following. (Sell price + Incentives + Holdback (look it up for each car sold the dealer gets around 2% MSRP) + Volume Discount (secret ask someone on the inside)) - (INVOICE). Check out the wiki for sites on what other people have paid including NADAguides. Again, that’s (Sell price + Incentives + Holdback + Volume Discount) - (INVOICE)= Profit.
These are programs made by corporate to give to dealers so they have more room to discount cars. Autobytel has lists for each make and model. However, make sure you are eligible before barging into the dealer demanding the moon. DO not let the dealer factor this into the sell price discount. They get reimbursed for incentives.
MONEY FACTOR
This is the bank’s profit, or in other words, interest. Go to edmunds (again info on wiki) to find the BASE MF for your vehicle. Dealers will sometimes mark up the interest and pocket the difference. This is where Edmunds comes in. Don’t get got.
MSDs.
Many carmakers allow REFUNDABLE MSD (multiple security deposits) to lower your MF aka interest. MSDs are simply monthly payments paid up at the beginning of the lease and refunded at the end of the lease. No questions asked even if the car is totaled (assuming insurance pays off the rest of the lease).
Fees
Look up the lease acquisition fee for your brand and other user’s average standard doc fees. Acquistions fees may be marked up so for example: MB’s base acquisition fee is $795. Many dealers mark this up to $1095 which you then have to call them out on.
In terms of doc fees, for example NJ is usually ~$499 and Florida can get up to ~$1000. Remember doc fees are sometimes the finance manager’s cut so they can be negotiable. However, lease acquisition costs are usually not, but why not ask?
Yeah, I’ve been looking a few 5 series loaners. From my lurking here it seems that for a loaner -20% MSRP should be the rough target (someone please correct me if this is misguided). But that being said I was in a dealership yesterday and the GM quoted me 10% off a loaner, so it seems very much “YMMV”
So I made an offer on a 2017 BMW X1 with less than 5,000 miles that the local dealership here in AZ is currently using as loaner. I purposefully made my offer and MF low as I know they would counter, here were my numbers:
$253 per month (excluding tax)
$275 per month (including tax)
$1636 (total drive off, first month payment, registration and doc fee and tax on cap cost reduction and fees)
And this was salesperson reply:
“On the lease of the 2017 you have the money factor lower than actual buy rate. Also where is the 20% off coming from? We don’t even have that mark up in a new car and this is a car with about 4k miles on it that’s already discounted. Not sure where the $2500 rebate is coming from as well BMW is not giving us a $2500 rebate on the X1. You might have that confused with the 3 series. I would really like to sell you a car but with this offer we are not even close to making a deal. If you would like to see what I can actually do for you I would be happy to do so.”
Oh well, I know I was aiming low but after this reply … time to move on as they were initially offering a MF of around 4.6% and a discount of $3500 on a X1 that was somewhat basic, only tech was nav and backup camera, no blind spot monitoring, parking assist, etc.
I think by having incorrect info (wrong rebate and MF), you are hurting your negotiations. The salesperson now thinks you don’t know what you are talking about and are not a serious buyer.
No, I explained that I was aiming low on the MF after they initially quoted me an inflated 4.65% and that it was open to negotiation…also, there is the $1500 lease incentive on the loaners under 5000 miles plus I was adding two other rebates that I thought I could qualify for that the salesperson actually mentioned to me. But thanks.
From experience, I messed up the first few tries also.
It took me 2.5 weeks to finally get to something I’m confident and biting.
Get quotes from 4-5 different dealer and compare what each has to offer collectively.
Each dealer will have different numbers, that’s how you understand where each dealer is making their money.
They can’t control the MF, figure out the standard MF for this month from the edmunds forums and state that you want that rate. They are allowed to mark it up, but if you know what it is going in then they can’t just pull a quick one.
This technique of yours really isn’t going to work. If I was trying to sell you a car I wouldn’t be taking you too seriously either.
You need to go to LA to get a better deal on a BMW. Scottsdale/Phoenix are not in a competitive market for BMW’s or any luxury car. Only 3 dealers and 2 are the same owner. Your not going to get what you want here. Check with Greg on bimmerfest.com as he does our of state deals all day long. You can fly in and drive back so the main cost is a Saturday. Every time I have done that I saved thousands.
