Couple of things to note and the determining drivers on why the dealer was able to and willing to make this deal:
Timing - end of year (not to mention year end model)
I had a lease which was used as a trade in. Due to the pandemic, used vehicles are more valuable and they paid off the car and took it in as a trade in. From my end, I simply intended to do a lease turn in and did not plan for this however it worked out in everyone’s favor. I could have interdependently sold the vehicle via CarMax and made 1,500 to 2,000 on it but at the same time I’m not sure I would have been able to secure the same deal.
Couple of variables.
The dealer was willing and able to. I’m sure this will change and a variety of factors. How many cars they’ve sold, numbers they are trying or need to reach for specific incentives, etc. The agreed upon selling price was about 1500 lower than other competitors although dealer quoted me only 500 higher (26k), they had various add-ons and refused to budge on removing them or absorbing the price to close the deal.
They didn’t put it into the deal. The pay off was at 14k and I see KBB estimates the value at around a couple grand more. The lease was sold to me at 18% off msrp which was significantly lower than anywhere else I could find, I suspect they made it up on the backend. I only found out about the “trade in” and not turn in when I went into the finance office to sign over the paperwork. I was ok with it as I got the deal I was looking for.
I don’t really understand, so was the positive equity from the old car used in order to lower the selling price?
I am in NY and just went in today to look at a 2020 CR-V EX (lower trim level) 36 months/12k a year and they quoted me $369 with $0 down and 1st month due at sign all taxes and fees included. She said they could possibly come down a little more which would bring it to like $350 at best. If I put down $1k then it would be $329 a month or possibly a few dollars less (including taxes and fees).
It doesn’t sound anywhere close to what you got so I am just wondering why it is so much different.
The only incentive available was $500 conquest.
They did not provide me with exact break down but they took off a total of $2650 off MSRP $30,280 including the $500 conquest so it came down to $27,630
It’s not unusual for a dealer to show a larger discount on a new vehicle and no trade equity rather than a normal discount and positive trade equity. It makes their deal look more attractive than the competition.
tl;dr I think having the lease to turn in got me an additional 1500 from what I had already negotiated.
Just for additional context, it required negotiating and they didn’t really proactively offer the selling price. I had already negotiated to 26000 (price match) before I ever mentioned a lease turn in (or that I even had an active lease). However, even at the 26000 quoted, they had some add on stuff that was bring up the price by close to another 1k and the numbers weren’t adding up. This was a similar situation I ran into while negotiating with another dealer (the one they had price matched). I suspected there wasn’t much else to squeeze out of the deal at this point and that’s when I brought the lease turn in into the equation.
My objective was to get below 26k net as I wanted to get at around 250-260 per month after tax. Since I knew there was lease cash (credit to edmunds for assisting with the details) and loyalty, I then told them I had a lease to turn in and that I was sure there were additional incentives and pushed to get the numbers I wanted. After some back and forth they agreed and that’s when I went in. When I went in to sign the paper work and turn in the car I then realized they set up my lease turn in as a trade but at 0 to me. I was OK as I met my goal, they got to make some money, and TBH I didn’t want to invest more time into the process.
In hindsight, I could have looked into selling the car independently and made some cash and negotiate the new lease independently, but at the same time it would cost me some time, inconvenience upfront, and no guarantees. This is my second try in the year trying to close on a deal…I had tried mid year but everything was still out of whack due to the pandemic so I passed and just extended my lease instead.