A more generic questions…I’m looking at the Toyota manufacturer lease offer for 2021 Corolla Hybrid…$119/month with $2999 due at signing for 39 months. The fine print says MSRP $24,604, net capitalized cost $19,704, residual of $15,254, and a TMS cash rebate of $750 applied as capital cost reduction.
So if net capital cost plus down payment plus cash rebate incentive comes out to $23,000 or so, where does the other $1600 or so gap between that and MSRP come from? Are they just assuming a minimum dealer discount of that much, or will they payback the dealer that much?
OEM advertisements usually say “dealer contribution required” but that doesn’t distinguish between discounts from their pocket vs passing on some OEM rebate.
It doesn’t really matter because
(1) OEM ads are usually a useless starting place.
(2) the gas savings on a Corolla hybrid is almost never going to make up for the higher lease cost vs a gas engine Corolla.
Are there ever OEM lease specific incentives? Do I negotiate the same way as if I was purchasing the car?
In this particular case, the hybrid stood out to me because the OEM hybrid lease advertised price is equivalent to the non-hybrid lease advertised price.
They’re generally poor deals, require an unknown dealer discount, and are misleading as they almost always have a giant asterisk of fees that are extra.
There are often lease specific incentives. The oem ad isn’t the best source for if/what they are though.
Your best option is to forget dealer ads ever existed, determine rv/mf/incentives separately, and look at comparable deals to work out a target pre-incentive discount. You can use that information to work out what your actual target lease deal would be. You’ll almost always find it is a lot less than what the dealer ad is (after you work out the actual cost of the dealer ad).
Most of the time they are useless because they usually contradict themselves within the text.
In this case ask a dealer sending them this offer if they will honor it. Also ask for the detailed breakdown. If you are happy with it you can take the deal.
Thanks for that. Are the incentives listed somewhere like they are for new car purchases? It seems like a lot of information that you’d need to know for a lease is not publicly available in advance.
Having current, accurate information for residual value, money factor, and incentives is important in understanding you deal. As such, going directly to a source that has access to that data from the captive banks is your best option. The forums at Edmunds are where we go to get that information, as they have direct access to it from the captive banks. You’ll want to post of the model specific thread for the vehicle you’re interested in and request the most current numbers for your zip code. It is often easiest to find that thread by searching Google for “Edmunds lease” followed by the model of vehicle you’re interested in.
Fair point…only thing is that it seems to me most of what I’ve seen on the forum is either luxury or some electric for the most part. Even with the discount the luxury cars are still quite a bit more than the Corolla, and the EVs depend on certain incentives (the state I live doesn’t have any incentives).
Of course NJ has EV incentives such as being exempt from sales tax. And there have been deals posted for ICE cars in the Corolla class such as Kia Forte, etc
@ElectricEliminator are people who get EVs in NJ now eligible for the charge up rebate if/when funds come back?
It doesn’t appear to be the case. Vehicles had to be purchased or leased by 12/15 and the rebate paperwork needed to be submitted by 3/15/21. If/when the program returns it will be in the form of a point of sale dealer applied incentive in the summer. July appears to be the target, but who knows with this kind of stuff.
I don’t live in NJ, but the Corolla lease offer was best in the northeast. My parents live there, so I could easily get there and stay with them a couple of days while I got the car, but can’t do the EV incentives that NJ has. I did encourage them to get the Bolt in October with the crazy deal and just have them give me their old car, but no luck!
I think one of the questions is, how does one even know what a good or bad lease deal is. I’m checking out some of the Edmunds forums now. I appreciate the help and pointing me in the right direction.
You need a baseline comparison point. Start with the current lease programs, determine a target pre-incentive discount, plug it in the calculator. Once you know where you’re trying to get, it’s easy to look at an offer and see if it’s what you want or not.
As for if a lease is a good value, you need to compare against other deals on different cars to see what else.you can get for your dollar. The shared deals and trophy garage threads here are a good first cut at that data without digging in too deep.
