One thing I’ve found in my price negotiations over the past year (I’ve leased 5 cars in 9 months) is that building rapport with your sales rep can be very beneficial. It goes against some of the tips given out these days (never step into the dealership until you nail down an OTD price via email!), but it can help.
The last 3 cars I’ve leased have all been through the same rep at the same dealership. For the 1st lease, I stopped by the showroom to meet with the rep, and we had discussed general pricing over email, but didn’t hammer out the specifics. When I got to the dealership, they presented me with their offer, and it met the conditions I was looking for, so I signed a lease that day (Spark EV for $150/month all taxes and fees rolled in).
Fast forward a month later, and I was negotiating for another lease (this time a '17 Volt). I sent an email to the guy (Hey, I am looking for a Volt lease with this payment/these terms, and want $XX,XXX for my trade in. If you can make that happen, I’ll be at your dealership to sign another deal. You know I’m legit since I just leased a car from you last month." He said they would meet all the conditions I requested, I went down a signed a lease for the exact terms I agreed to over email.
Fast forward ANOTHER month later, and I was looking to trade in my Spark EV I had leased 2 months ago for a new Spark EV lease. My sales rep and I were able to quickly lock down a deal for an exact same equipped Spark EV with a monthly payment LESS than the Spark EV I was currently trading in. Even though I had about $800 negative equity on the old Spark. Ended up getting a $0 down, $148/month deal on the NEW Spark EV. I know that for this deal they bent over a little to make a sale to me (gave me $13.5k trade value on the old Spark EV, which was $1.5k higher than Carmax). So was able to basically swap for a new Spark EV with a lower monthly payment and no extra money OOP.
Once the dealer knows you are potentially a real sale, and not just fishing for quotes to then cross shop at the competition, they should start to get serious with their offer.
Manufacture volume bonuses (if they meet a ton of other CSI and volume qualifiers)
You have to realize that you are a dealership terrorist at this point. You may get worked for a few hundred bucks. You may get the run around and wait to close your deal with the finance office longer than usual (finance guys deplore buy rate leases on customers locked in on a payment). You may have to leave over a few hundred bucks. That said, at the end of the day, the sales person is going to work hard with all of those moving parts to make your deal. He prefers that you sign and drive, but he is fighting a GM, Sales Manager, and Finance Director who’s reputation is gauged by profit per unit.
When I’m shopping for a lease I’m going to find the perennial “Sales Person of the Month” that moves units for the company and likely has several deals each month that make the management team smile. They move a ton of units and get leeway with these guys to take ugly deals from dealership terrorists.
If you stay patient and loyal with your sales guy. You will probably get your deal.
PS. If any of you dealership terrorists are looking for a deal in Houston with any manufacturer, I’ll likely have a “go-to guy” for you. Good luck out there and happy terrorizing.
Dealer “terrorist” seems a bit…extreme, especially in this day and age. Don’t tell anyone you are a “dealer terrorist” on a plane.
I wonder if there is a term the dealers use to describe people like us that try and shave every last dollar off the final payment. Besides expletive-deleted. haha.
I know credit card companies call people who pay off their balances every month “deadbeats”.
I have to agree with Kos here. In Phoenix we have some dealers that are just straight-out ridiculous in their sales tactics, these are the kind where when you pull into the dealership, before you can unbuckle, there is a guy standing at your window. And if you make the mistake of going inside with them, they have “managers” in these glass offices perched above the peons, i.e. sales floor as if they are prison wardens. If your salesperson doesn’t make the deal, they come down and throw the salesperson under the bus and try to get you to buy something before leaving. Ugh.
At the higher-end dealerships, I don’t see this as much and like some others have said in this topic, you can form relationships but at the same time, these people are truly not your friends. They have one goal in mind and that it to make a sale. However, treating them with dignity and respect does go a long ways and is highly recommended.
Do you research and be informed, Never make the “deal” at the dealership, over the phone or email is much easier and usually produces better results. Walk away if you can, they will call and offer you more of a discount, just wait 24 hours and your phone will ring! And be cool about it, don’t get into yelling matches or be a jerk.
Funny enough @lease34, I was between an Audi S6 and a nice BMW X5. I ended up picking up the X5 yesterday but the S6 deal was pretty good IMO. I would have taken it. My Audi guy called me today and goes, “my man, we can go a bit lower if you come by today for it, what’s your target?”. And he knew I was between both vehicles. A little too late, my friend. X5 in hand. Good residual, good deal, and I’m paying $40 more per month for the X5 with a $18k higher MSRP than the S6.
But I maintain the relationships, I would go back to my Audi guy. Great to deal with, respectful, and worked hard with me to strike a deal. At the end of the day, you don’t have to get the car. The sales people perhaps are looking for a few hundred bucks, but the money is there no matter what on the backend. No one is giving away anything for free, contrary to some popular belief in this thread.
@Randy_Haddox well said, of course you’re biased as your on the other side. Customers are not terrorists, and unfortunately this is the type of shit that I don’t come to dealers like you about. What, you get maybe 1/10 customers who are ACTUALLY complete douche bags and will ruin your day? Be realistic, good luck with those Tahoes and Volts.
As far as “dealer’s like me”, we lease upwards of 60 cars a month here at my dealership. My deals alone compromise 25% to 30% each month. They’re more often than not pre-negotiated, pre-printed, and ready to sign and drive.
@Kos, that’s a great deal on the X5, sweet and well done! Yes, I am in the same boat, last 5 vehicles have been from a local Audi dealer here and my sales guy is just awesome, I literally tell him my numbers, he comes back with his, I push a little harder and we wrap up a deal. Go into the dealership, about 30 minutes later walk out with a new car. They know I don’t want any add-on’s of other crap so finance takes about 10-15 minutes and I am out the door. But I have my eye on a Mercedes that I like but it’s going to be tough to not buy from my guy at Audi. But like you, I will go back soon I am sure!
Just out of curiosity, how many of your customers walk in and pay the “advertised” lease deal compared to those who ask for the money factor, residuals and know how a lease works?
@lease34 I really wanted that S6 man… I really did.
X5 - 92695 MSRP, 82375.78 SALE PRICE, 7 MSD, .00088 MF, 12k mi, 36 mo, 59% res … $999 / mo
S6 - 77595 MSRP, 735943 SALE PRICE, .00034 MF, 12k mi, 36 mo, 54% res … $968 / mo
Both are with 7.25% tax…
The X5 is pretty dope, but boy do I wish I was zooming around in an S6. It didn’t have the dynamic handling package or whatever they call it but I can totally feel the sluggish response time of the X5 (obviously not M, I teased myself driving the 110K MSRP M…) and the xDrive50i forcing it down on a straight away.
No buyers remorse but I was torn. Dad car or batmobile. The S6 was sick… I went Dad car.
so what is the best strategy for a first time leasing? I see I need to know money factor, residual but how do I even know what is good on those numbers? Sorry new to this site and trying to figure out all the information here. So here’s what I think I know:
dont tell the dealership I want a lease
try to get the price of the car down (but how? just check edmunds, carsdirect, kbb to see what the best price goes for?, then use that and ask dealers to see if they can go below that? Do I just ask for a lower price or do I need proof of what other dealers are selling it for?)
at some point after an agreed to price, spring it to them and tell them I now want to lease?
then ask to see lease numbers of MF and residual?
I really just want to be under a certain monthly payment, so use the above to get to that number? I live in NY close to Vermont border, so I can go to different states but would rather not drive too far. NY has cap on doc fee of 80, everywhere else its up for grabs and could run into the hundreds. I’m looking for a Jeep Wrangler for under 240. Is that realistic?
You can get your dealer quote in as many or few steps as you want. Always first find the RV, MF, and incentives on the specific vehicle and term before contacting the dealer. I would also go for a test drive but resist going into details about what you want and tell them you can’t make any decisions that day.
Then you can email the local dealer and ask what would be their best sales price before incentives. Use services suck as TrueCar or Edmunds Price Promise to see what you should be able to get and use it to negotiate if the salesperson comes in higher. Then you take that sales price and the RV, MF and incentives and plug it all into the lease calculator to find out what your monthly payment would be. If the payment works for you, tell the salesperson you would like to lease the vehicle for x months/miles at that payment (including taxes) and what drive-off costs you want to pay upfront (doc fee, DMV, cap red taxes, etc.)
Alternatively, you could do all of that in one step by checking sale prices on Edmunds or TrueCar and include the selling price you want in the email with the lease terms and payment that you want. (Ex: Hi, I’m interested in this model, stock #xxxxx, and I’d like to know if you would be able to do this lease on it: 36/10k, selling price $00,000, $0000 in rebates, $000/mo including 8% tax, only first payment and registration fees due at signing. Thanks!)
There are a couple of Jeep Wrangler threads right now, check them out and see if the trim and terms you are looking for is listed.
Wrong. DO tell them you want to lease. This will save you and them a lot of time since the finance and lease sale price will be different in most cases. Otherwise, there will be a surprise waiting for you when you finally settle on the price and go to the dealership. However, DO NOT tell them how much you want to pay monthly and get the sale price first.
No. Do not tell them lease or finance, you don’t need to. Once you negotiate on a price there are incentives that are decided on whether you lease or finance…
You’ll end up getting the runaround of, oh you’re leasing? BMW is having a $2000 incentive for leasing this month through BMWFS…
you think you’ll get the best price? Don’t tell them shit until you get the price down to something you feel comfortable through research. Edmunds is my weapon of choice in researching invoice prices. I work hard to get as close as possible to invoice.
Whatever they tell you, they don’t lose money on offering you incentives. In the BMW example, they will get that back from BMWFS …
Find out the money factor, residual for the term you want, and rebates available. Most seasoned sales guys will come off this information in an email conversation. Then throw them into the calculator here. Easy peezy.
Make sure you know your credit situation thoroughly before you go into negotiation.
Quick search on edmunds :
"anupam3 said:
Hi Please tell me RV for 2016 Wrangler Unlimited (4doors), for 36/10 for Freedom, Sahara, Willys Wheeler W and Rubicon trims. I believe the MF is still the standard MF (.002).
Thanks a lot. Keep up the good work!
Standard MF
72%/64%/72%/63% residual"
Looks as if no lease cash available. My time at Spring Dodge in Houston gave me some insight into pricing on jeeps. You may have to work for it but a 9% discount isn’t out of the question.
@Randy_Haddox good stuff. On the note of not telling the dealer lease vs. finance, what is your guidance since your the man that deals with it every day?
