Okay, this will seem trivial. BUT…I go to a dealer website. Look for a vehicle I like. I see it listed at 50,000 MSRP then an incentive or several, maybe one for 500, one for 1500.
When you start negotiating, you’re focused on getting a reduction based on the listed MSRP? Then once established, an OTD price accounting for fees and incentives? I hear about 2k, 3k, 5k off, but I’m going to be at a few dealerships between now and next week and trying to understand this all as I plan to be more aggressive and sharp than I ever have before for a vehicle.
Put together a well-researched target deal for your situation. Make the dealer an unambiguous, immediately actionable offer over email. When one says yes, go take delivery.
The most important thing to do is putting together that target deal before you ever talk numbers with a dealer and don’t bother ever asking them for a quote.
The only useful thing on a dealer’s website is the inventory so you can identify what stock number to target.
I’m having a hard time with that LOL I hear, especially for leases, I’ve heard people say to aim for a 15% cap reduction right off the top, before incentives etc. But I struggle to get a full OTD price. It seems like dealers have so many possible fees.
Would I say, something like, based on research, I would like to lease this vehicle with a Cap Cost of 50,000, a cap reduction of 10,000. I know the residual is “x” and the MF is “x” for a period of 36months and 36k miles. If this is a deal you would accept, I can stop in or do the documents remotely, today?
This number is vehicle dependent. What applies on one does not necessarily apply on another. You will need to do research into specifically what you’re looking for.
No, it’s not. The cap cost you requested is the sales price, which should already include the dealer discount. And asking for an OTD price for a lease doesn’t make sense.
You need to do more research and get all the terminology correct before you make any offers, so there is no misunderstanding of the deals being asked and presented.
Why care about the OTD if your sole purpose is to lease? Use this site’s “Signed” deals as data points and map out at a target deal using rate finder ($15/mo). OTD is irrelevant unless you plan to purchase the car.
In the context of a purchase, where it does apply, it makes no sense to target an OTD price and then add in incentives. An OTD price by definition includes the incentives. Go in talking about OTD prices in a lease and you will come across as someone who read a post online about car deals but don’t actually have any idea what you’re talking about and are an easy mark.
Negotiating the discount and then the next and then the next is also a huge waste of time since you’re leaving things ambiguous as you go. The different parts of the deal are not disconnected, so you may agree on a discount but they based it on a marked up mf with add ons and incentives included and you based it on none of those things.
While the deal is holistic, there are too many areas where an inexperienced lessee can get tripped up. A lessee needs to understand the parts of the lease in order to make an informed offer,
OP, first you need to decide what vehicle you want. Go to dealers to do a test drive if necessary, but don’t talk numbers until you know what you want. Dealers will hate you for this because they want to sell cars, not give joy tides, but that is part of the process. Once you have zeroed in on a specific vehicle, do your research here to see what others are paying in YOUR area. Taxes, dealer fees and rebates vary by location. Look at Marketplace, Signed and Pre-negotiated Deals sections to get an idea of discounts being offered. Edmunds can provide MF and Residuals, or sign up to be a member and use Ratefinder here. Then start constructing your deal and use the Calculator to figure the monthly payment.
Once this is done, start emailing dealers that have a vehicle you want on the lot with your offer. You will get many NOs,but only need one YES. Don’t get discouraged. The alternative is to use a broker if time is important or you just don’t want to do the legwork required to get a strong deal. It is OK to also be flexible if you find the exact vehicle you want, but dealer won’t meet your terms exactly. I wouldn’t walk away from a deal over $10-$20 bucks a month if everything else was exactly what I wanted. Maybe the dealer will throw in some free oil changes or floor mats to close the deal.
Geez okay, I didn’t think this topic would get people going so much.
First, let me satly thanks for the replies. I appreciate insights from you guys.
Second, please dont post here bashing me and tell me I sound dumb and I need to do more research. THIS is part of my research. This is a forum to ask for information and advise, if you dont like the topic, you can cruise on by and have a great day!
I have leased 2 times in the past. So I am not clueless, I am simply trying to hone in on what my exact approach should be.
I’ve read, I’ve gone to Edmunds, I discovered this place, I’ve watched YT videos. Now, its no surprise, but people in all of those different realms talk differently about leasing. In fact, a guy who sold cars for about 42 years, through one source, says you should ALWAYS negotiate OTD pricing, even when leasing.
Another mentioned that you need to settle on a cap cost, which can be between 5-20% depending on the car. This, it seems, is prior to any incentives and rebates, at least according to his video. With the incentives, this becomes the adjusted cap reduction. You want this number and the RV to be as close as possible in your deal.
Anyhow, thanks for all who replied with honest, good natured thoughts, ideas and feedback. It is greatly appreciated.
If you’re leasing just look on this website what others are paying and brokers are advertising. That’s basically your target. If you don’t want to play the game hire a broker and save yourself the headache. Some enjoy it, I personally don’t so when I get anything but a Toyota I use brokers myself.
This is a summary of all the moving parts. It’s called a lease proposal, and it works 95% of the time… at least for me. Let it do all the talking. Called the dealer yesterday on someone else’s behalf and told the SM that I would be emailing them a proposal. Within a few hours, he emailed with the following…
I am about $1000 away. Can you be a little flexible?
I responded with…
$1000 is too much flexibility for me. If you can live with $375 off the trade, customer can sign tomorrow.
Haven’t heard back yet… stay tuned. I’ve discovered that Equinoxes (gas) are a bitch to negotiate! I’m guessing that any gas-power car is tough to negotiate except for a few.
Anyway, I suggest that you create a proposal and email it to the sales manager (SM), not a floor salesperson as they’re often order takers and lack knowledge. All numbers should be accurate otherwise, you’ll lose credibility. Negotiate via phone/email. Once an agreement is reached, ask the dealer for a review copy of the lease agreement and all contract addenda BEFORE you go to the dealer and sign. Moreover, it’s helpful to know the terms and conditions of the lease contract such as early termination liability criteria and purchase option criteria as well as lease amortization methodology and excess wear/tear criteria. If all is as agreed, tell the SM that you’ll come in to sign right away. You don’t want any surprises or dealer excuses like …. Oh, we made a mistake. That’s unacceptable and shouldn’t be tolerated.
It’s very foolish and nonproductive to waste hours sitting in a dealership negotiating. This can be a huge distraction. You need time to think things through and formulate questions within the privacy of your own home.
If the dealer isn’t transparent or is uncooperative or showing signs of incompetence, WALK AWAY AND MOVE ON!
Leasing is time-consuming and requires a good deal of study and attention to detail. If you don’t have the time to commit, perhaps your best alternative is a good broker. There are some outstanding brokers on this website. However, if you’re willing to commit your time and resources, always control the deal. That can only be achieved with education which breeds confidence and increases the likelihood of success.
If I were a car salesman I would LOVE it if customers did that.
I could agree to the “OTD” price to make the customer think they’re getting a deal, meanwhile I’m pocketing the completely different lease incentives and I marked up the MF to the moon, and I end up making thousands over what I could make if the customer just negotiated the lease directly like we teach here.
There isn’t any meaningful condescension or hostility in this thread, sorry if you reading the discussion that way.
There is a lot of nuance in the language used in this industry, and words and phrases aren’t interchangeable with each other…
And you have a distinct advantage when you can speak the same precise language as the people who are trying to help. This takes time to pick up, but IME it’s well worth the investment.
Ambiguity in language is your enemy, as it opens up opportunities for a dealer to exploit what is likely an actual gap in understanding.
I frequent this forum almost every day, and I still learn new things.
Ya, I’m in a region where there arent many comps here. I would venture a guess that there is VERY little, if any, presence on these forums from anyone else in my city LOL
I had been narrowed down to a Sportage Hybrid or Tucson Hybrid. But there arent really any modern deals here for those vehicles leased, ESPECIALLY in my area.
Someone mentioned the Mazda CX-50 hybrid, which I like, but ny research tells me is more expensive thena many other comps in its segment.
Lastly, the Hornet R/T seems to be attractive with all the incentives, but I have concerns on back storage space and while I have seen a few deals posted here for Hornets, I have seen 0 of yhem anywhere near my region, which can have a significant impact on things.
