Next time get a check for the equity. 6000 means an effective payment of 717 assuming 0 DAS.
Did you get other quotes on your trade in to see if $6K was a fair offer?
Yes. They gave me $1k more than the KBB trade-in value.
It sounds like you got a price through Costco’s car buying program (which is just TrueCar, which is basically just a dealer referral network).
The only category of discount I’ve ever gotten that way is “Garbage” (compared to what can be achieved with some nominal research and effort on my own).
Where Costco membership has a benefit is when you can get an additional incentive on top of what’s available to non-Costco members. This is in addition to the discount from the dealer.
The additional Costco incentive recently saved us an additional $1,250 on our LYRIQ, after the dealer discount and all other incentives.
This month it appears that additional incentives are available for certain Chrysler and VW models.
I italicized the words discount and incentive for emphasis, because they’re two different things.
And was there anything DAS besides the equity?
Thank you! Is this calculation based on the information from my original post or hcernitz’s recently signed premium plus lease?
I was just re-reading this calculation, and I’m a little confused. I think my confusion stems from how the dealer is poorly explaining/using inaccurate words for the discounts, rebates, incentives that are being applied. On the phone, he verbally said I have loyalty of $1500, season of Audi $1000, customer credit $1500, and costco $2100, for a total of $6100. But then his emailed quote after that phone call has different values and verbiage, where it now said loyalty $1500, national customer credit $2500, and discount $2588. So with your recent posted calculation, I wonder if I actually only have $4000 rebates/incentives and then $2588 discount, not $6100 rebates/incentives and $2588 discount. For my understanding of your most recent calculation, did you essentially categorize the $6100 as incentives/rebates and then disregard the $2588 discount?
As I stated in an earlier post, the 2588 discount is the dealer discount. In a later post I had stated…
I should have been clearer by combining these two statements in a single post. Sorry. The 2588 dealer discount is deducted from the MSRP to determine the selling price or what is known as the agreed upon value. This discount is separate and distinct from rebates/incentives. The 6100 rebates/incentives are in addition to the 2588 dealer discount. According to your phone conversation with the salesman…
He obviously omitted the 2100 Costco incentive in his email to you…
You may want to seek some clarity from the dealer. The 2100 Costco incentive is completely separate from their 2588 discount. One has nothing to do with the other. Remember, Audi pays the 2100, not the dealer.
Finally, I did a little bit of research and found that an 8% discount or 4572 off MSRP is reasonable.
Keep me posted.
Audi rebates are confusing, this post from Reddit is worth a read: https://www.reddit.com/r/autocompanion/s/CXM0lI8FdH
Program |What it means
Loyalty Credit |Customer-facing rebate if you currently own/lease an Audi or have one in the household.
Customer Credit |Customer-facing rebate. This should reduce your deal directly.
Audi Credit |Customer-facing incentive, but it generally does not stack with special lease/APR rates. Best when paying cash, using outside financing, or bringing a credit union.
Marketing Allowance |Dealer-facing money.
The big one: Customer Credit and Marketing Allowance can stack.
They just show up differently.
Customer Credit is a rebate to the customer.
Marketing Allowance is dealer support, but a motivated dealer can use it to give you a better selling price.
It’s a little confusing.
From time to time, automakers offer an incentive specifically for Costco members. This month, it’s a $1,000 to $1,250 manufacturer incentive for Gold Star and Executive members, respectively, on VW SUVs and Chrysler minivans only. There is no manufacturer incentive specifically for Costco members on Audis this month.
Separately, Costco offers a Costco Auto Program for its members. Costco enters into an agreement with participating dealers to offer Costco members a pre-determined dealer discount. Usually, these discounts are pretty lousy. From reading this thread, the Costco Auto Program discount seems to be a $2,100 dealer discount.
All that is to say, this dealer’s $2,588 dealer discount (4.5% off MSRP) exceeds the $2,100 dealer discount (3.7% off MSRP) through the Costco Auto Program, but many here on Leasehackr would suggest that @Medgirl32 target a payment that reflects a ~10% off MSRP discount.
What you’re describing makes sense. OP is better off shooting for an 8% - 10% dealer discount and forego the Costo 2100 dealer discount. I know that 8% off is doable in the Cleveland market… not sure about 10% but it’s worth a shot. You can always come down but can never go up unless there is some trade-off.
All Costco seems to be doing is providing participating dealers with referrals. I learned something new… that’s why I’m on this website… lots of people providing insightful info! Thanks!
Okay, got some clarity from @michael … Apparently, the Costco 2100 is a prearranged dealer discount. Read @michael’s post above. So, you have rebates/incentives totaling 4000 (vet these) and are being offered a dealer discount of 2588 in lieu of the Costo 2100 discount. I stand corrected. The consensus here is that you should counter with 10% off MSRP (5715) … So, here is what I suggest you propose assuming everything has been vetted…
Sell Price… 51435,00
Acq Fee… 895.00
Gross Cap… 52330.00
CCR… 947.58 (calculated using the CCR formula)
Net Cap… 51382.42
RV… 33718.50
MF… .000237
Term… 36
Loyalty/Credits… 4000.00
Sales Tax Rate… 7.00%
Lease Inception Fees
1st payment… 692.35
CCR… 947.60
CCR Tax… 66.33
Lease Tax… 1744.72
Dealer Doc Fee… 398.00
Gov. TLR Fees… 151.00
TOTAL… 4000.00
Loyalty/Credits…… 4000.00
DAS…… 0.00
Bottom line: Zero due at signing plus 35 remaining monthly lease payments of 692.35 each.
I read your post on Edmunds… nice job. Let me provide more clarity as I now understand it thanks to @michael. I thought Edmund’s response was somewhat confusing. So, here is my understanding after considerable thought…
Costco’s Audi “$2,100 incentive” is NOT manufacturer-funded.
It is not an Audi rebate.
It is not reimbursed to the dealer.
It is not stackable with dealer discounts.
It is a pre-negotiated dealer discount that Costco forces participating dealers to honor.
Costco is simply selling leads. Dealers participate because the discount is intentionally weak.
- Dealer discount offered: $2,588 (4.5% off MSRP)
- Costco discount: $2,100 (3.7% off MSRP)
- Dealer says: “You can have one or the other.”
I discovered that is the telltale sign of a dealer-funded program, not a manufacturer incentive.
If it were manufacturer-funded, the dealer would: apply the Costco incentive on top of their discount, get reimbursed and have no reason to resist it. However, they are resisting it — because they pay for it.
Costco sells referral traffic. Dealers agree to:
- A low, fixed discount
- No negotiation
- High-volume lead flow
Costco gets:
- Referral fees
- Membership value perception
Dealers get:
- Guaranteed foot traffic
- Low discount obligations
- A chance to upsell financing, warranties, accessories
Costco is not trying to get you the best deal. They’re trying to get you into the dealership.
I believe that the dealer and Costco discount of 2588 and 2100, respectively, are both very weak. I’m very confident that the Cleveland-Columbus-Pittsburgh markets can do 8% off MSRP. So, I suggest starting with 10% off MSRP which seems to be the LH consensus and use the 8% as a floor… at least initially. You can always come down but never go up.
This is not the same as getting real online quotes from Carmax, Carvana, etc.
It is much better to calculate and put your own target lease payment/DAS together and YOU make offers to dealers to control the process. Go to the Wiki here and learn the math and how to use calc or put your own spreadsheet together.
It’s fine for them to give you an introductory offer, but you need to be the one to propose the final deal as I did with an Audi dealer last week.