So my wife and I went to the dealer today to test drive 2 cars.. we decided on a pre owned Acura RDX 2017 dealer loaner car.
Price was 34,900; out the door around $38,500.
I told the salesman our bottom line price was $31,000 out the door. (looking for around $400/mo payment).
Guy said nothing they could do, that they only make about $600 profit on loaner cars and that was the best deal. But suggested we lease.
Wife and I said thanks and call us if there's anything they could do.
Now we're both feeling like we could have done better...maybe upped our price point a little. It was a really nice car with tech package and 100,000 mile engine/powertrain warranty and 4 yr/60000 mile bumper2bumper.
Car has 18K mile on it.
We're both a bit overwhelmed by this so as a post-mortem, I was wondering if any of you guys or gals had some feedback or maybe could point out if we were being unreasonable.
Thanks BBI.
If you do, hold the line again, they will bring it down. The 600 cap is more than likely pure bs.
I personally wouldn't buy a loaner car with that many miles, but if they don't sell it to you for your price point, then let it go. If you feel like you can pay a little bit more, then give it a week and give the dealer your final offer on a quick call. Good luck!
Gone are the days when dealers make a huge margin. They make almost nothing on new cars but do often have a decent margin on used. It's unlikely they're making a lot on that loaner car.
You might be able to get $1500 off of it if you're lucky but that's pretty unlikely.
Smart dealers these days don't negotiate. They price aggressively and make about $500 per car in margin but turn inventory at a high rate. Then they make a killing on add-ons (never buy them) and servicing.
Have you priced the Certified Pre-Owned Acura RDXs ??
LOL, how do they not have an acquisition cost? They bought it from the OEM and have an outstanding loan on it that they need to pay off.
Also, generally the warranty would have started already when the vehicle was first used. Maybe the dealer would honor but I don't think Acura would. I say that because I once bought a loaner car from Hyundai and had an issue with the full warranty
Btw, the $600 profit bit is complete bullshit.
If you have USAA or certain credit cards like Capital One, you can use their car buying service. Should save you a few thousand.
First, never tell them you have a car to trade until after you have negotiated the price. You want to keep that as a separate negotiation. Otherwise, they play with the numbers to make you feel good about getting more for your trade but then you are probably paying more for the new car. Sell on your own if you can.
Second, never tell them what kind of payment you want. THAT is when they try to put you into a lease and they typically make more money that way. Always focus on the total price.
Finally, do not get emotional over this. It is just a car. You also need to go into it understanding that because it is a car, you are going to lose money. So, dont be in a rush to make a deal just because you are in love with the idea of having a new car. The longer you wait, the more money you end up saving by not having a payment this month or next month. You don't NEED a car, you just want one.
I personally wouldn't buy a loaner car with that many miles, but if they don't sell it to you for your price point, then let it go. If you feel like you can pay a little bit more, then give it a week and give the dealer your final offer on a quick call. Good luck!
Ditto
Why? Because some people value saving money over bring in a new car every 3 years.
Also they don't make huge amounts per car anymore. If the dealership let you walk then they won't do it, at least now (maybe in a few months when the next year models come out). If they were close they would have stopped you.
Finally leasing is great if you want to have the car for 2-4 years. If you want to hold it for long term than buying is cheaper.
Have you looked online at a place like cargurus.com and seen if any other cars like this are available in your area? What are the prices? That will tell you a lot.
As far as the profit margin they are definitely lying. But it's about how much they are lying about total. And I second those that say wait until the end of the quarter to make the purchase. They really are quota driven.
The dealer doesn't look at it that way though. They look strictly at the cost basis of what they bought the vehicle for on the trade in.
Quote:
For low payments without a ton of money down leasing is the way to go. You always have that option to buy the car but why when you can get a new one every 3 years?
Why? Because some people value saving money over bring in a new car every 3 years.
I'd love to hear your explaination how your saving money buying one vs leasing?
I'd love to hear your explaination how your saving money buying one vs leasing?
While paymemts are higher when buying, you can have many years with no payments. With leasing you will have monthly payments forever.
Quote:
I'd love to hear your explaination how your saving money buying one vs leasing?
While payments are higher when buying, you can have many years with no payments. With leasing you will have monthly payments forever.
Yes, if you have a decent interest rate and you're planning on holding onto the vehicle for at least 6+ years plus you have no major repairs after the warranty runs out. Not many people do that.
With a lease you're only paying on the depreciation which with an Acura is not that bad at all. Your warranty and in some cases maintenance is covered, and you can usually get much more car and still have cheaper payments.
99% of Cars are not investments
0% interest on a car that I liked (two of them actually) and kept for 10 years+ is better financially than 10 years of lease payments. Plus when I traded both in after the 10 years (12 for one) they still had residual value in a trade and if I felt like it could have sold privately for even more.
If you want to drive a new car every few years then it doesn't make sense to buy, otherwise if you buy a reliable car and plan to keep the car a long time buying can absolutely be financially better than leasing.
Quote:
In comment 13502747 montanagiant said:
Quote:
I'd love to hear your explaination how your saving money buying one vs leasing?
While payments are higher when buying, you can have many years with no payments. With leasing you will have monthly payments forever.
Yes, if you have a decent interest rate and you're planning on holding onto the vehicle for at least 6+ years plus you have no major repairs after the warranty runs out. Not many people do that.
With a lease you're only paying on the depreciation which with an Acura is not that bad at all. Your warranty and in some cases maintenance is covered, and you can usually get much more car and still have cheaper payments.
99% of Cars are not investments
Low interest rates are not hard to find right now. When they go up, that's also going to drive lease rates higher. So the comparison won't really change.
Cars today are built to last. Choose a reliable brand and model and you can expect it to last without major problems. We've owned 7 cars we purchased new, and kept all a minimum of 8 years. Currently have 10 and 11 year cars, and they're both holding up fine. Sure we have to spend some maintenance money on them every year, but it's still far less than what annual lease payments would be. And when I do buy another, I'll get cash for the current car that will lower the payments on the next one.
No, cars are not investments. But that's irrelevant. Long term ownership cost is what matters.
And hey: I'm not telling you you're doing the wrong thing. If you want a new car every 3 years, it's certainly more cost effective than buying and trading every three years. But there is a cost to having new wheels every three years.
That's nothing new. New safety features have been coming to cars since they replaced the lever pressure brake with the mechanical pedal brake. If you always want to have the latest and greatest, then spend the extra money and lease.
If they let you walk... You probably had the best price. They are entitled to make a reasonable profit.
It isn't that it's hard it's just that playing the game is annoying and time consuming. I went to get my new car a month ago, test drove it for 15 minutes, agreed to the price, and it still took 4 hours to take it off the lot. It's almost a whole weekend day gone and that's if things go your way.
Then send an email similar to the following for every dealer you can:
Dear [contactname],
Thank you for your response to my inquiry. I'm interested in purchasing a new car within the next week. Could you please provide a price for a [year] [make] [model]? Please specify all applicable fees and add-ons including destination and documentation fees, floor mats, splash guards, etc.
I'm interested in this model in [color1] or [color2]. Are either of those colors available? If so, please include any additional charges for paint in your price.
Again, I'm interested in acting quickly, so please provide as much information as possible on your available cars including the VIN#(s) so that I may make an informed decision.
Sincerely,
[yourname]
0% interest on a car that I liked (two of them actually) and kept for 10 years+ is better financially than 10 years of lease payments. Plus when I traded both in after the 10 years (12 for one) they still had residual value in a trade and if I felt like it could have sold privately for even more.
If you want to drive a new car every few years then it doesn't make sense to buy, otherwise if you buy a reliable car and plan to keep the car a long time buying can absolutely be financially better than leasing.
Quote:
as investments per se, but financially buying was better than leasing.
0% interest on a car that I liked (two of them actually) and kept for 10 years+ is better financially than 10 years of lease payments. Plus when I traded both in after the 10 years (12 for one) they still had residual value in a trade and if I felt like it could have sold privately for even more.
If you want to drive a new car every few years then it doesn't make sense to buy, otherwise if you buy a reliable car and plan to keep the car a long time buying can absolutely be financially better than leasing.
pjcas - Where are you getting 0% for the life of the auto loan?
Auto loans in my experience are always fixed - so the rate is always for the life of the load but that's just my experience.
But I misspoke, only one of my vehicles was 0%, but anything sub a specific number (maybe 2.5%? is still worth buying IMO based on how much you finance)
And the 0% is not now, it was when I bought the cars. I bought an Acura (a TL) in 2002, and it was 0% through Acura, and Honda Pilot was 2005 and was 1.8% through AAA. I replaced the Acura with an Acura MDX at .08% interest (dealer financed again) in 2012 and the Pilot with a new Pilot in 2017 at 1% (also through Honda this time).
if the dealer finance dept does not have sub 2% interest rate offers at the time I shop around, with excellent credit someone will offer you those rates. Only the dealer would offer 0%, since otherwise why lend the money, but I got the 1.8% on the Honda Pilot in 2005 from AAA.
Right now Honda is offering 0.9% on certain vehicles.
Personally, I wouldn't touch that car unless it was a very sweet deal, as in 30% less than what the book value of that car is. God knows what the people who drove that car did to it.