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I might guess that it has something to do with the lease being in the leasing company's name, while a finance contract will be in the buyers name? Maybe the leasing company has to charge for services provided, like registering the car every year? I'm out of my league on that one, sorry.
bing330i - thanks. I think I'll pick my car up on the last day I am in Munich, simply because I don't want to have to deal with getting around an unfamiliar city with my brand new car. I'd rather get out on the highway as soon as possible after picking it up. So that means the museum/factory tour may be on an earlier day.
the acquisition fee is a little bogus... in some cases (like bmw fs), they include the gap insurance in it (not all)... as far as registering the vehicle, that's up to the lessee to do, and pay for... the lessor doesn't pay for that...
dirty little secret... you are essentially paying 525 bucks for the bank/fs company to store the documentation on the lease and forward you the registration renewals every year (as well as any unpaid "traffic infractions" you might have incurred, for which they will charge you a fee as well)...
disposition fee is even more dirty... you are paying for someone to push a button that marks your loan/lease as satisfied, go find the paperwork that you originally signed, stamp it "paid in full" (or something to that affect), and mail it to you...
and people gripe about atm fees...
-Chris
Numbers break down approximately as follows:
330i - PP, CWP, Auto Trans., metallic paint
Domestic MSRP: $39.8
Domestic Invoice: $36.5
Euro Price ($1.5 over invoice): $35.7 (note: I bought before the price increase on 1/1/02, so increase by 1%).
Trip costs:
Airfare: $350 r/t
Lodging: Free - family
Rental car: none
Opportunity cost of capital for 2.5 months @ 6%: $440 (you have to pay for the car 30 days prior to pickup in Europe).
So to summarize, a comparable domestic deal would be about $38.0 - savings of approx $2.0.
Trip costs: $0.5 to $1.0.
Value of driving the A-95 into the Alps at 100+ mph - priceless.
I was under the impression that the disposition fee was used for any reconditioning prior to auction, also for transportation to said auction. That makes sense to me, except if the dealer buys the car.
Again, not my league. In fact, we started doing self-inspections here recently, and I will do everything I can to distance myself from the guy doing the inspection and the customer. Not something I want to be involved in, telling people they have to pay for brakes and tires after they aren't even driving the car anymore!
One thing I do find is that dealers will tell you their "true invoice" is actually 300-500 higher due to advertising fees and other dealer "prep" work. Should we be targeting 1500 over base invoice or invoice+other costs? Also, its seems that most dealers prefer to mark-up the base money factor. Another .0002 (i.e. using .00225 vs .00205) is the equivalent of an additional 500 of cap cost at the base rate.
And you are correct, BMW dealers do not receive a holdback from BMW.
I guess it has to do with turning the car in, someone not 'owning' it anymore, that one would be insulted.
that's why I now steer waaaayy clear of that scene.:(
Bill (owner) gave him some advice, etc, etc. The guy thanks him and leaves (obviously, off to scout out Sears).
"?"
Bill explains: guy on a leased car. 18" wheels that he hadn't bothered to ever maintain air pressure in, so they're now shot with 10-15K miles. Wants something cheap to throw on the car, as he figures it will cost him less than at the dealership. Customer doesn't care if the expensive car now handles like garbage (a classical poseur, to the hilt!) Bill doesn't carry trashy tires, especially in 18" sizes, so he gets a lot of these ...and unfortunately, they seem to be more and more frequent.
-hh
1) Do the acquisition fee and disposition fee go entirely to the lease holder?
2) Are they negotiable? I've been told that not all lease deals include these fees, so that implies that if you shop around you can avoid them. BUT, does that mean you might be paying a higher interest rate? Perhaps it means when comparing lease deals you have to look at the overall picture -- fees plus interest rates?
I think if you can get $1,000 over invoice including the advertising fee, with NO additional charges except government fees and taxes, you've cut a very fine deal -- assuming they don't get to you on your trade-in, financing, etc.
1) People (like me) who are going to Germany anyway, for a vacation.
2) People who can fly over free for one reason or another.
3) People who are willing to go over in the dead of winter (now, but you're too late for this year) and can take advantage of VERY low seasonal airline fees. (I think I've seen a low of $125 roundtrip, with strings attached. By way of comparison, the best I've been able to find traveling in June is $1299.)
BTW, if anyone has any advice on how to get a better price (I.E., should I wait until later in the year to book my flight, etc.) I would appreciate it. I'm not talking about stuff like stand-by, leaving at 2:00 AM, making multiple stops, etc.
Hi Robert,
I am glad we have knowledgeable people in this board to help us (simple mortals) with our questions, and guide us through our BMW buying experience.
I see you did serious research and read my previous posts in these boards, it is an honor to have a fan of my literary work (I hope);)
Yes, it is obvious my BMW experience so far has not been the best (I work hard for my money, you know, same as you).
I witness dealers lie to me repeatedly about the .00205 money factor twice, they did swear in my face that I was incorrect (so I walked out). Same thing with invoice price (obtained from the "Confidential Wholesale Price List, effective 01/01/02" (sorry, I don't have the copy in front of me so the exact title and date of the document may not be accurate for this writing for those reading this with a magnifying glass) so I walked out. All this information corroborated by a 3rd and 4th dealer by the way.
Finally, a dealer was honest with me, so I stayed with him, and as soon as the deal is completed, he will get my best praise and recommendation, as well as referrals in my behalf.
Based on my humble, brief, unscientific experience, this single honest dealer represents 10% of all the BMW dealers in my region (Due to the small sampling, this results are not statistically significant).
I should apologize if my remarks about the yacht or Fifi offended you (or any one out there). (All my characters are fictitious and any resemblance with real life is a coincidence). I just wonder why you reacted so offensively to my post (by the way, I leave far away from NJ).
Allow me the liberty to quote you:
"I am a 'Client Advisor' for a BMW dealership in NJ. I like being able to help people out whenever I can, that is just me. I believe that one hand does indeed wash the other, and I hope to be very successful with whatever I do"
I appreciate your intentions, and thus, I am surprised by your answer to my post. Although I admit being very emotional by my sour experience, your comments and sarcasm goes against your claimed intentions in this message board, and only contribute to add more wood to the fire.
If you are really a member of that 10%, then allow me to apologize if it offended you. If you belong to the other 90%, in this competitive world, sooner or later, you will burn yourself. Your costumes know who you are!
NOW, IF YOU ARE REALLY A BMW CLIENT ADVISOR, THEN TELL ME, SERIOUSLY; ARE THERE ANY EFFORTS BEING MADE BY BMW OF NORTH AMERICA TO IMPROVE THEIR COSTUMERS SHOPPING EXPERIENCE?
Have anybody, ever, paid for advertising fees at: Target, Walmart, Home depot, Lowes, Sears, Amazon, you name it?
How about, has anybody seen an advertising fee added to the bill of your Pepsi (you know, Britney is expensive), Texaco oil, Famous chain restaurant, ... I am going to stop so you don't start snoring.
So!!!!!
Advertising, like electricity, water, gas, cleaning supplies, telephone lines, etc, are part of ANY business costs!
So how come YOU, the costumer, have to pay for it!!
Hey, you might even have to pay taxes over the dealers advertising fee, sweat!
http://www.nurburgring.org.uk/
Apparently anyone can drive on it but it doesn't sound very safe with, according to this guy, an average of 1+ fatalities there PER WEEK.
My cost look like this:
I paid $34,250 for my BMW 325i vs. $36820 at U.S. MSRP with a possible low of $35770. I will fly from Houston to Munich and then from London Gatwick to Houston for $481.50. I will drive around the Rhineland region of Germany, France Luxembourg and Belgium for 3 days. My brother and I will take the car and the ferry from Zeebrugge to Dover for $115. Drive around East Anglia (the counties of Norfolk, Suffolk, Essex, Bedfordshire and Cambridgeshire) for 10 days. Drop my car off in London and come home and wait and sulk and wait and sulk. Then go crazy when I receive the car for second time. I will incur no hotel costs. I will pay for the same amount of gas as if I was going to rent a car. I will buy my car accessories in Germany tax-free and cheaper. The only real cost for me is the ferry and the extra leg of my flight from London to Munich. I still save money. As long as I have family and friends in Germany, I will buy BMWs or Audis(if they ever get a European Delivery program)this way. Last time I went home, it cost me over $500 in rentals for two weeks, plus gas and food because I had my whole family. Mass transit costs in Paris, Brussels, Amsterdam and London. This will cheap considering how many thousands that I spent and that includes the fact that I had one free plane ticket.
Different strokes for different folks.
On the other hand, one of our friends who bought a Lexus receives letters from the company almost every other week, inviting them to parties, driving schools, etc. Of course Lexus is trying to win customer base from the German luxury brands, but the bottom line is, BMW not so good.
Are you any relation to the NJ BMW dealership of the same name?
-hh
For example, right now there are two tickets from Chicago to Munich going for $195 (plus $180 for taxes and fees). The dates are fixed and this flight is for March 4th, but it's been available for the past 45 days with no bidders (believe me, I've been tempted but my we're due with a child on 3/11).
http://www.thedailyauction.com/lhu/dynaweb/au_main.dyna?l=en&pos=us&p=lhu
postoak - acquisition/disposition fees. it depends on what type of agreement that the f&i guy has with the lessor. not much of an answer, i know, but as with a lot of these things, it depends on the dealership. let's say joe schmoe dealership is writing a thousand leases a month through bank xyz. he's going to get more favorable terms than the guy who is writing 5 leases a month.
as far as negotiability. yea, anything is negotiable, but my opinion is that it's not worth fighting city hall on these. you hit the nail on the head when you say you need to look at the overall picture. compare this to a mortgage. if you are willing to pay points up front, you can (and do) can get a lower interest rate. if you don't, you get a higher rate. if you let the mortgage run it's full length to maturity, it's going to come out in the wash. there's good financial reasons to do it either way.
yes, brave, you DO have to pay for wear parts as part of your lease. it's generally spelled out pretty specifically in the lease terms how much tread needs to be on the tires, thickness of brake pads/linings and so on... i'm SHOCKED that you didn't know this. i'm assuming you are leasing?
no one said the fees were "sweet profit"... someone had to write the software to do this, the hardware had to be bought, the people trained to use it, and so on... what i should have said is that once the infrastructure is in place, what you are "getting" for those fees is pretty minimal... not to bore anyone, but banking over the last 10 years (and somewhat the 10 before that) has gone from a business that primarily derived it's revenue from interest received on assets to a business that now derives better than 50% of it's income from fees...
anyone who knows better than i, feel free to correct me. i won't cry too much...
-Chris
Do you really want to talk about who was being sarcastic?lol
As I stated in one of my previous posts, you have the right rules, they're good, and they're easy to use. So I was wondering HOW you were are having such lousy experiences? Now you're having a lousy experience trying to buy a car, but you're qualified to come on here and start advising people on how to buy a car. That may be why my last post was somewhat sarcastic, BUT, no less sarcastic than your post.
And maybe yes, I took a little offense to your statement that all BMW dealers are a disgrace to the human race, wouldn't you take some offense if I made such a broad statement about any group of people?
I started in this business about 4 years ago, I'm not an old-schooler. I see stuff posted on this site all the time that absolutely floors me, in terms of customer service, and dealer practices. I never treat any customers with any disrespect, if I did I don't think I would be where I work for very long. My dealer is very much focused on customer satisfaction. What else is there when you live in an area with 20(!) other dealer all within an hour and a half of here? I make a mistake on a price quote that's too low? My manager would never think to try and change that price, but rather he would honor it and tell me to stay focused and try not to let it happen again. I am a youngish looking 26, and I've had people ask me if I'm old enough to sell cars, so a lot of people see me as an easy guy to deal with because they seem to feel that I'll be easier to 'work over' than some of the older guys here. If they are pleasant towards me and not demanding and rude, I will work for them as much as I can towards getting what they want. We are very much of a 'soft sell' store than the high pressure places. I couldn't imagine working in a place like that, I doubt I would last long at all. And yes you are right, my customers know me, and will continue to know me, for I anticipate being here for a long time. In fact, the GM has been here for longer than I've been alive, SM has been here about 15 years, along with a number of other salesman either over or approaching ten years employment.
So I am very proud of where I work and how I conduct business, and then I see your post about me being a disgrace to the entire population, I'm sure you understand.
Rob
ccotenj..your vast knowledge never ceases to amaze lol;)
the possible answers for the questions you were asked were 1-excellent 2-good 3-fair 4-poor. With the new survey possible answers will be 5(best) through 1(worst).
Will this improve customer satisfaction? Who knows, personally I think it is silly to use a multiple choice to determine a cutomers experience. Maybe a simple, "Would you buy a car from this dealer again?" would suffice, also allowing to explain answer in more detail if the customer wishes.
and Miguel, I wish you the best of luck and sincerely hope you have better experiences.
Rob
don't let miguel run you off...
hey, miguel, why don't you take it over to the smart shopper board? there's plenty of dealer trashers over there who will sympathize with you. you won't get much here. since people like millero have been giving us the straight story for awhile, you are going to be able to destroy his credibility with us....
-Chris
Ended up picking a car that contained an extra option (heated seats) and different color (Jet Black 4th choice) rather than wait a couple of months to get what we wanted exactly. This also turned out to be the cheapest car and the lowest priced over invoice. I did not bother haggling any further. There were equally good values in cars with more options and different colors.
The CPO program seems to be a rip off. The sell price of these cars is inflated to the point that even with a deep discount you will still get less than 3- 3.5k a year off for a used car. Might as well get the new and get the best years equall depreciation. I suspect the CPO market will collapse in a few months but didn't feel like waiting.
The wife found the shopping experience to be OK not great. The Infiniti and Jag dealers were much nicer but the bottom line was BMW was professional and acceptable. I think the other dealers work harder because their product is not as good.
If anybody is interest Manhattan BMW has 2001 330i sedans availible at very attractive prices. I just didn't want to spend the extra bucks for the bigger engine.
2001 Prelude Type SH, 2022 Highlander XLE AWD, 2025 Camry SE AWD
FWIW, my total time from Munich drop-off to arrival in NJ (your car will go through the canal for west coast delivery) was exactly 3 weeks.
Hgeyer; That is something to think about. Thanks!
-Chris
Thanks for the info - you'd be surprised how many dealers do not know this info or do not want to take the time to initiate the process.
Customer is obviously very upset about this, but agrees to take the car anyway after we discounted it another $1000 off of the price without the lumbar support. Then we gat absolutely slammed on the csi survey, ALL poors. 0%.
I certainly understand why some dealers would be ignorant or play dumb regarding ordering a car with cloth seats, if one thing goes wrong, in the space of a couple hours, you risk getting hammered for trying to do a customer a favor by custom ordering. It is safer to just stick with what is offered in the US for options. If you insist on special ordering options, the risk is very high for it not to come the way you wanted in it, in relation to just ordering off of the U.S. price list.
After you pick up the car in Munich, how do you determine where to bring it for shipping or is all that worked out in advance?
After you pick up the car in Munich, how do you determine where to bring it for shipping or is all that worked out in advance?
Regarding fees and such, security deposit comes back to you, disposition fees do not. However, I've noticed that most of the time they are the same dollar amount. I've yet to have a bad experience with the lease return. I've been dinged on windshield chips on one car, but not the bug red Kool-Aid stain on the carpet. Go figure. I've yet to return my bank lease though, and I'm a little wary of that. The manufacturers have a vested interest in not making you feel bad when you are returning something so that you will come back for another lease, a bank doesn't.
I've leased only domestics to this point, partly for the dollar value, but mostly because I don't want to get out of warranty with them. I've never had more than one visit to the dealer during the warranty period for any of the cars/trucks I've had. When I've owned it seems they will last reliably until the 80-100k range. That said, I'm going to buy my ordered 325i not lease. I'm hopeful that a German car will push that 80-100k range into a 120-130k range. It's going to cost me more per month, but the lease deal wasn't really all that attractive.
Lastly on leases, yes you can bargain. You should be prepared to bargain the up front price of the vehicle just as if you are buying it. In a way, you are buying it, just for the person who holds the lease. A high MSRP brought down considerably and a high residual value will cut down your lease payments, all else being equal. So too will a reduced money factor. But, as is a recurring feature on this board, educate yourself completely on the deal. There are lots of ways to sour/sweeten lease deals.
Air Fares
I'm picking up my ED in Munich at the end of May. I'm then driving and flying out of Amsterdam. The best deal I could find was $1016 on Delta. The Summer travel season really changes things. However, if you want an upgradable fare (i.e., frequent flyer points) it will probably cost most, perhaps $500, but IMHO well worth it, especially if your company is paying;). I've only flown a few times to Europe, but my experience is that you should try and make any plane changes in the States. Two and a half hours on line in Paris waiting for reseating because my inbound flight was late convinced me. One line and absolutely no other person (like a gate agent) could/would help. I know of direct Munich flights from Atlanta, JFK, Chicago, Dulles, I'm sure there are more. Hope it helps somebody.
No, I did not get much of a deal but I learned a lot. If I did my research better, I would have got the car at $1800 above Euro Invoice. My wife might still buy a car at the year, so I already know a dealer about three hours from Houston that will give me a better price.
$4500 is a lot to play with in Europe if you plan right. Just try to get cheap tickets and avoid flying in the summer. The prices are much higher.
millero3 - good post and good points
Brave - go on and tell an Amish joke - what are the chances any of them are monitoring the board!
Thanks,
Bradd
2001 Prelude Type SH, 2022 Highlander XLE AWD, 2025 Camry SE AWD