How to start the negotiation?


How do you start the conversation when you sit down to discuss numbers?

  1. Do you let them put down their numbers first and then eliminate the down payment and try to reduce the monthly?

  2. Should you wait until after that to offer putting MSD down as well (if they accept that)?

  3. Or do you tell them your full bottom line and what you’re willing to do for it all at once?

Thanks very much!

I think many of the people on this site will recommend knowing all your numbers up front… MF, residuals, incentives, MSRP, invoice price, etc… then go into the negotiation with only one number you’re working towards which is the “sale price” of the car before incentives. If you can find out what the invoice price is, try to get the sale price well under invoice (of course very dependent on how popular and/or hard to find a specific car is). Once you have the number you want (after punching it all into the lease calculator) then make sure you get the lowest MF that is allowed and that they’re not hosing you on the residuals. If all that falls into place, you should get the monthly you expect.

All that being said… I’ve found that to absolutely not work for me. :wink: I seemed to have better luck laying all my cards on the table and saying, “this is the monthly payment I want… 0 cap cost reduction… max MSDs”. Can’t say it’ll always work, but if you throw out all the technical leasing terms, they realize you know what you’re talking about and not to screw around with the numbers.

I’m still a n00b, so I’m sure someone will have much better insight than I have, just giving my experience. :slight_smile:

Having just gone through this, I agree with @ng0 100%.

I thought the right approach was taking bids then seeing which dealers would match best offer, but honestly that got very really hard to keep track of and compare evenly because there’s so many different factors at play. I kept going back and forth asking for breakdowns, if they were including rebates in their sale price already (even though I asked them not to), etc and it quickly started to give me headaches.

I didn’t get my best offer (that I ultimately went with) until I simply laid it all out on the table and showed my knowledge- broke down the lease math with the correct RV & MFs, etc. I sent an email with all that then called the dealer to basically say, “these are the payments I expect with what you’re giving me, then below are the payments I want. If you come back with the number I want, all the math broken down exactly the same so we’re on the same page, I’ll go in tomorrow and sign.”

Some dealers were not able to match my number, they simply returned with their best offer and said hope we can earn your business. The dealer I went with matched that number and I was confident walking in everything would check out (it did) because I left no room for funny business. That approach made it a lot easier to compare offers and evaluate my options instead of trying to reconciliate everything in the background myself.

If I had to do it over again, I’d recommend skipping the “give me your best offer” phase, instead check KBB for fair market price, then go through dealer inventories, jot down the MSRPs and Sales Prices you see so you have a starting point (make sure you’re keeping track of trims and options/packages, as those can skew the numbers and make some deals erroneously look better than others). Based off those anchor points, calculate your “ideal” number and your “I will be happy with this” number, then start negotiations from “ideal”. I wouldn’t lay it all out on the table at first, but you should quickly be able to determine if your ideal number is right on the money or if you’re being totally crazy based on dealer responses. After that initial round you can adjust your expectations as needed, then feel free to get more specific with MSDs, monthly payments, etc to get to a number that will get you in the door.

Of course, this was also just my experience and my opinion so take it for what it’s worth. Others may prefer a different style or approach.

Everyone here agrees. It is all about knowing all your numbers before you walk through the door. They instantly change their attitude when they realise you know all the factors that make up a lease. Not just the MSRP, but MF, residual, rebates, discount etc etc.

There was a similar thread recently which had some good pointers as well.

@michael if you merged/combined them it would make a good sticky thread or FAQ

In a nutshell, in addition to knowing MF, RV, etc., I research as much as possible to find what other people have purchased or lease for. It’s important to know the selling price and what incentives applied. You might qualify for more or less. I try to get a sense of what’s a “good” deal (towards the lower end) and make that my target. I start a little below that, either to leave some room for negotiation and/or because even when dealers “accept” they have unpredictable doc fees or extra options/accessories on the particular model I want). I send my spreadsheet over email which lists every field and outputs the monthly and drive-off $ amounts down to the penny.

BTW I am lucky to live in an area with multiple dealerships for every brand. The ‘acceptance’ rate can vary from 1/4 or 1/5 down to 1/12 (a 2012 Mercedes… $350 on a 60k car when lease hacking was unheard of)

Thank you all so much - these are very helpful tips!

Super helpful - any chance you could share your spreadsheet? I have a pretty simple one, I’m curious what fields you include.

sure will PM you…

hey max, i would love to see your spread sheet as well

Max, can you please share your spreadsheet with me as well?

Here’s a View-only version:


BTW there are some more tips in this thread:

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Also this by @Ed_Churchward on BMW which is applicable to some other brands as well:

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