I see lots of guides online, and in this forum, saying to ask for all kinds of numbers like MF, residual, fees, selling price, rebates, etc. when requesting a bid from a dealer.
Can someone explain why these numbers matter to me when negotiating? Or put a different way, if I request bids from all the dealers in my area, is it not just a matter of asking them for the monthly payment amount with everything above rolled in?
For example, could I not say, hey - tell me the EVERYTHING INCLUDED (fees, etc.) monthly payment for a $0 down, $0 drive off, $0 due at signing lease for a (insert car here)?
And then just work the dealers off of each other until I get the lowest price? Or am I missing some kind of important step where the detail numbers matter to my bottom line?
Having all the numbers allows you to have a full picture of the lease, especially when talking to different dealers that have vehicles that arent equipped the same. Also, many salesmen seem to have a fear of low payments, so if an aggressive deal seems low to them in the monthly, huge walls are put up. If you instead deal with the dealer discount and let the monthly payment fall out at the end based on all the numbers, that wall can be avoided. Also lets you know what area of a deal you donât like you need to target.
There was a lengthy discussion on this a few months back.
To borrow the expression from the founder of this website, at the end of the day, it doesnât matter how the sausage is made. In other words, if the deal you get is truly the rock bottom possible, then it doesnât matter how they got there (eg. maybe they marked up mf from base but went deeper on the dealer discount).
However, if you arenât getting the absolute cheapest deal possible, youâd need the variables to see what aspect of the deal you can work on.
If thereâs plenty of evidence here that the absolute rock bottom on an Audi Q5 stickered at exactly $50k is zero DAS and $400/mo pre tax, then yes, you can negotiate based on payment alone (Assuming youâve found a q5 stickered at $50k). Only problem is, itâs almost always not that straightforward.
Thanks for the reply as well, @mikem! I see - so youâre asserting that once all the bids are in, if Iâm not happy with the price, then I can ask for the details and perhaps poke the number down further with help from the folks on this forum?
Why wouldnât I be able to negotiate on payment alone? Perhaps you can elaborate on this:
Only problem is, itâs almost always not that straightforward.
I mean, in theory the competition between dealers (âThis dealer is giving me THIS price, can you beat it?â, etc.) should drive me to the lowest price because capitalism, no?
Youâd have to get the lease program terms (mf,rv and manufacturer incentives) from edmunds, and then if possible, get data from here (or elsewhere) on selling price/dealer discount on the same make and model.
From there, you can dissect the dealers offer to see if thereâs room for improvement.
Often times cars are equipped differently, thus various msrp and it might not be a true apples to apples comparison. Also, some cars have been on the lot longer than others, so one dealer might be more motivated to move it (or may even have extra help from the manufacturer).
YOU should know those numbers so you can figure out what a good deal should look like so you can compare. For example, maybe one shop is using a higher MF than the others or charges more upfront for a doc or prep fee. But kind of like Bill Parcells used to say, the only number that matters is the final score.
If youâve fully researched all the important numbers and market prices to arrive at a very aggressive target payment, then you can start with just that. It makes the initial contact easy as a lot of the initial sales âconsultantsâ who respond donât even know the nuts and bolts terms either. This is also how they generally work with the GSM to see if the deal can be made (i.e. âcustomer A wants $400/mo $1K DAS can we do that?â and theyâll plug that into their selling software to back into all the other numbers).
Where you need to dive more into the details is when you have figured out which dealers are showing themselves the most willing to deal aggressively. Thatâs especially true if there are various different incentives in place to make sure that youâre comparing apples to apples with the different offers.
For example when I was shopping my wagon, I didnât mention anything about my special $1K event code when comparing offers. I was only talking selling price and monthly payments, because itâs easy for me to vet the quotes.
@mikem âs suggestion on looking up aged units is invaluable. Go to cargurus and sort by âoldest listingâ and start with that unit at each dealer. Once you have a lowball offer in place you can then cross shop that to other dealers for anything else on their lot. Having something in writing (or a screenprint from your phone) that you can forward around is key. Good luck.
Its a matter of âhelp me help you.â The point above about walls being put up is, for example, you go to dealer B and say âdealer A offered $350/mo with $0 DAS. Can you beat it?â Then that salesperson would knee-jerk say âno way $350 on this car! I canât do it.â HOWEVER, if you said, instead, âdealer A is offering $x discount before $x incentives. Can you beat it?â Then they have one piece to work with that they understand. You are spoonfeeding them rather than hitting them in the face with the whole pie.
Yes, a lot of times dealers salespeople donât have an idea how to âmake a dealâ. In fact , many wonât even want to tell you the sale price or donât like talk in terms of % discount on MSRP.
But to give you a specific example:
Out of the 6 dealers in my area, the lowest quote I got had the rebates wrong. They had offered me 14% off MSRP, which was the best discount, had the lowest quote, but the fact that I know that the manufacturer offers an additional 1K off lets me know there is more room that the dealer isnât giving me or doesnât know he can give me.
Why let them propose the deal? Go to them with the deal you want.
To give an example, I have negotiated a lease where Iâve gone in and said âI want x% dealer discount pre-incentives at base mfâ and we went back and forth, finally agreeing on a % we were both happy with. When theyâve then determined the monthly/DAS based on that, the response has been âholy crap, itâs that low?â
Same with when I insisted on a 24 month instead of 36 month on my current lease. Was told no way it was cheaper per month to go that way, until they ran it. Because I knew all the numbers, I was able to sculpt the lease the best in my favor.
The bigger question is how do YOU know what is a good deal without having all the numbers?
If you are waiting for them to propose the deal then you wonât get anything amazing. You need to know the numbers so you know how much room there is to push.
Now, I would recommend finding the RV/MF/incentives independently. Edmunds is a great source for this info. Some dealers are really stingy about giving out that info.
OP, you are asking this on a board full of number geeksâŚwhat you expect to hear?
Truth is some on here overkill the process. If you know all the incentives, mf, rv, msrp for the model you want and the dealer gives you a 0 down with the lowest monthly anyone offered you why even ask for detailsâŚsay âtanks, Iâll take itâ and go sign.
Iâve thought this exact same thing before and when I took the âlowest monthlyâ it turned out to be a bait and switch in F&I with contract being completely different than what salesman had committed to over email and phone. Wasted about 4 hours that night, never again. For that reason I insist on all of the numbers up front. The math is easy and it has to come from somewhere.
Iâve had detailed numbers agreed over email and when I show up the GSM shakes my hand and gives me a paper with something entirely different. Dealers gonna do dealer thingsâŚ
Conversely, after doing some research here, I knew what I wanted in terms of dealer discount, available incentives, and money factor. But I didnât know the exact payment because I wasnât sure what the extra fees would be. So once the dealer came close to most of my conditions, I assumed the payment I got was the best I could get. Not realizing I had gotten a good sale price but then they jacked up the cap cost with a bunch of bogus fees that were rolled into the payment.
