Stories from the Sales Frontlines

driver100

My friend who I hadn't seen for 40+years and who got exactly the same car as I have, a 08 3 Series BMW hardtop convertible traded it in. He decided his wife doesn't like to drive around with the sun on her, and it doesn't have enough room in it for long trips. I liked his car, white with a red interior. It had less than 10000 miles on it.

So he shows up to meet me with a great big honkin 7 Series, M model. He said he went to the dealer thinking of getting a 5 Series, but they were discounting the 7 Series $15000, and the 5 Series with the same options (standard equipment on the 7 ) would cost about the same. And they took his convertible in which is almost 3 years old, with less than 10k miles, and gave him $15000 less than what he paid.

I went for a ride in it, but it is too big for me. If given a choice, I would take the 3 Series any time. I think this is really a status car, not too many people need to drive around in a big limo (unless it is a Lincoln Town Cat of course, which is being bought for its nostalgia value....can't be for status).

Interesting thing. There is no place to insert the key. Since you just need to have the key with you, there isn't even a place on the dash to stick it in...no slot. The funny thing is, he doesn't want to have the key in his pocket, so it rattles around in the ash tray when he is driving. I think eliminating the key slot is one step too far, at least it was a place to keep your key.

graphicguy

firefighter....since XM and Sirous merged, I'll assume you can do this with either. Seems as if the last 3 cars I bought had XM or Sirious installed. After the trial period, as you've noted, they send letters, call, etc trying to get you to renew. Every time, I've made a point to mention to them that I'm not interested in the ~$150/year renewal. But, that I "hear" that they have a rate they can offer for 1/2 that per year ($77/year, IIRC). They renew at that lower rate every time.

Now, I've tried to get them lower. There's a promo floating around if you sign up for a year, you get 6 months for $5, but the other 6 months at regular price....about the same as I renew for).

Seems like the $77/year is the "real" rate if you ask for it, though.

jayrider

Isn't the new 5 series pretty close in size to the 7. Next time you take a ride with your friend, wad up a napkin and stuff it in the ashtray to mute the rattle.

kyfdx

Subaru Financial is all run through Chase Bank.. I just dropped my car off at the dealer and they asked for the keys, input the info into the computer, and that was it... No inspection at all.. That made me very nervous..

But, I got the final bill, and there were no wear-and-tear or damage charges..

Honda sends out an independent inspector, a few weeks before lease end... They enter the info into their laptop, and print you a report at that time.. If you have any issues, you have time to rectify them before turn-in.. It's a great system, and really alleviates any concern over lease-end charges.. I've leased four vehicles through Honda Finance, and never had an issue. A lot of banks work this way, I think.

Most BMW dealers have an employee designated to do the lease inspections on turn-in. They generally don't do a pre-inspection, but I'm sure they would, if you ask.. It's generally an easy process, but of course, dependent on the individual, and anecdotal evidence is that some dealers aren't so generous with borderline damage, if you aren't getting a new car from them.. However, the standards are published and there are few disputes..

We've leased 7 or 8 cars... I've had very few issues on turn-in, and to be fair, the charges I've been hit with were legitimate... I've probably skated on a lot of things. (55K miles on original tires on a Pathfinder.. no charges!).

Leasing is just an alternative way to finance a car.. It works for some situations, not others.. It's not for people that don't understand it...

regards,
kyfdx

isellhondas

I;m surprised Subaru does it that way and I would have been nervous too.

The saving grace is the fact they want people to lease additional cars and they don't want unhappy people bad mouthing them about the way they were treated.

If Suburu were to trump up petty reconditioning charges, word would spread like wildfire. " Don't ever lease a Subaru!...they will shaft you when you return it".

As far as leasing. It's not for everyone. You ar basically renting a car. If you typically replace your cars every three years or so and enjoy driving a new, trouble free car that is under warranty, it's a good thing to do.

Just don't ask Clark Howard or Suze Orman about leasing a car!

gogiboy

"Leasing is just an alternative way to finance a car."

Kyfdx

Is "finance" the right word. Isn't borrow or rent a better term since you won't be owning it at the end. I've heard the term financing applied to goods that will ultimately be owned like a house (mortgage) of car, but never applied, say, to someone who was renting a house or apartment even though a deposit for security and last month of rent is often required.

If I was renting a cottage, boat or even kayak for the summer--or year--would I be financing them? even these stores that loan money to customers to help them get a TV or furniture when they can afford it outright call the process "rent-to-own".

Just wondering, not trying to pick a fight. Maybe financing sounds bad when you don't own the item at the end of the process. Of course many people don't really ever own their homes either, but the presumption is that they are trying to own otherwise why not rent?

Gogiboy

kyfdx

Not really a good analogy.. and, here is why..

A car is a consumable item.. the longer you own it, and the more you use it, the less it is worth.. With a house, you expect it to grow in value (not withstanding current circumstances...lol).

So, if you buy a car and finance it for the typical 60 months, you will build some equity in the car, but only to the extent that you have a higher payment than if you leased.. At the end of 36 months, virtually any equity over the loan value can be traced to the higher finance vs. lease payment.

On a house, if you have a downpayment, your mortgage could be the same or less as a rent payment, and over the years, you'll actually see your equity grow. You can make real case that owning is cheaper than renting, in the long run. (Of course, if you just replaced a water heater, refrigerator and programmable thermostat over the last five months, you could argue the other side...)

I'm not arguing that leasing is better than owning (or vice versa), just that it's an alternative finance method.. There are advantages and disadvantages.. For those with illiquid finances, it can cause some difficulty, if circumstances cause you to be unable to live up to the terms of the lease, or exceed the limits.. I find that leasing works best for those that can afford to buy the car.. If the only way you can drive a certain priced car is to lease it, then it is probably more car than you can afford. (which is where the alternative financing definition is appropriate).

If you do trade cars every three years, and you drive within the limits of the lease, you can actually save a lot of money by leasing the best deal out there at the time... But, it's still more expensive than buying a car and keeping it for 6-8 years... That's apples to oranges..

regards,
kyfdx

driver100

Isn't the new 5 series pretty close in size to the 7.

I like the size of the 3 Series, it is 178 in long X 71.5 in wide.
5 Series is 193 in long X 73.5 in wide
and the 7 Series is 199 in long X 74.5 in long
So, compared to my car it is about 2 feet longer or 10% longer, and 3 inches wider which is a lot. When you drive onto a parking lot you really have to think about where you want to park it, especially length because it sticks out a lot, but width too...and those doors are huge. By the way, you don't have to push the door closed, just give it a slight hint and it will do the rest. The 5 Series is 7 inches shorter (7 inches can mean a lot of difference ) and is 1 inch narrower.
It is pretty close in size to the 7, but just doesn't seem as big.

If you look at a picture of the 7 Series you will see the rear side window is enormous, so when you are in the front seat, 3/4sof the car is behind you. It seems out of balance to me.

snakeweasel

Leasing a car is not the best financial thing to do, but neither is trading in for a new car every two or three years.

Best thing to do financially is buy and keep.

mako1a

I thought they were like the Three Bears.
Papa Bear in the 7 Series, Mama Bear in the 5 Series and Baby Bear in the 3 Series.

driver100

Papa Bear in the 7 Series, Mama Bear in the 5 Series and Baby Bear in the 3 Series.

Guess I am happy to be a Baby Bear.

I don't understand the need to have a car larger than what I need. I think a psychiatrist might be able to answer that one.

driver100

Leasing a car is not the best financial thing to do, but neither is trading in for a new car every two or three years.

Every situation is unique and there are times when leasing makes sense. For example, if I got a good job, that was a 20 to 30 mile commute every day, and I didn't have the down payment for a good car, I would lease. I would be getting a new car that would get me to my job, and it would require little money down. At least I would know I will make it to work and can buy the car at the end of the lease....and if the miles to work was more than that, I would just buy the car back at the end of the lease.

Incidentally, I found an ad for leasing a Ford Fusion interesting. $199 month for 27 months! 27 months sounds odd, but maybe they wanted it to come in at under $200. But, wouldn't you just increase the downpayment to get to that number?

And another thing, those lease payments look good but are meaningless in the ads, since the downpayment is in fine print. What does it matter if I can lease a new Jaguar for $300 a month, when the downpayment is $12,000?

driver100

Yesterday we drove 2 hours to see family. 70% of the trip is on a 6 lane highway, and it was fairly busy for stretches. There are a lot of people who drive pretty slowly in the left lane. As an example, the car in front of me in the left lane is going fairly slow and there are a string of cars behind him/her. Finally, there is room on the right to move over to the middle lane, use the twin turbos and 300 horses, to get by this road hazard, and then move back into the left lane when necessary. An important rule of defensive driving is to move away from the pack.

There is less chance of an accident if you find an open space on the road. I like to get away from the clueless and drive in a less cluttered zone....and the horses allow me to do that. I have had 4 speeding tickets in about 45 years of driving, so it isn't because I am a speed demon.

snakeweasel

Ah but then you have a 3 year leas and then a 5 year loan. In the long run you usually pay more overall leasing then buying.

You are better off getting a good used car (4 or more years old) for a few years then trading in for something newer. Or seeing if there is a car you like that has a rebate and apply that rebate as a down payment.

According to Edmunds TMV the base Focus with manual tranny and no options is just over $17,600. At $199 a month ignoring tax, title, doc fee and interest it would take 89 months to pay it off. So you are looking at a high residual to pay off at the end or a big down payment, or both.

My guess is once you get the trim you want with the options you want adding tax, title and doc fee and getting the down payment down to a reasonable level you monthly lease payment will be much, much higher.

snakeweasel

Gee I find myself in that position often. I usually do what you describe but usually with half the horsepower.

I am still not convinced that my belief that many cars today have far more horsepower than they really need.

jipster

Finally, there is room on the right to move over to the middle lane, use the twin turbos and 300 horses, to get by this road hazard, and then move back into the left lane when necessary. An important rule of defensive driving is to move away from the pack.

That may be a bit of a stretch calling a slower driver a "road hazard". I would think passing a "string of drivers" behind said slow poke was not a "defensive" move, but an offensive one... as it probably offended the "string of drivers" wanting to do the same thing. Yeah, it's a good move if not that busy.,But seems there is danger in that at any moment one of the drivers originally in front of you will zip over into that middle lane and try to do the same thing you are doing... possibly causing an accident. I see it happen a lot, reminds me a lot of a horse race during the homestretch... jockeying for position and all. So, if using the "move, I would throttle back a bit on the twin turbos, which would provide a greater margin of safty and still allow passing of slowpoke rodriques.

driver100

. I see it happen a lot, reminds me a lot of a horse race during the homestretch...

Excellent analogy, and I don't like to do it, but I still think it is the lesser of two evils. If I don't do it, the guy behind me will do it, and I will never get around the slow driver in front (I won't call him a hazard although he will probably cause an accident somewhere down the chain, even though he will be oblivious to what has just happened).

It is unfortunate that driving has become so tactical. On the way to the destination time didn't matter, so I could go with the flow. On the way back, time was more critical, so I drove more aggressively than I would like to....and that isn't pleasant. I didn't mention the guy at the back of the line who is working his way up using the right and centre lane trying to get to the front of the line.

I also have an idea there should be separate highway police in unmarked cars who stop people for these B grade infractions like driving slow in the left lane, cutting in and out, zig zagging, and the new one I see all the time now....going at full speed on the on ramp so you can cut in front at the last minute of the car already on the highway. The fines would more than pay for the cost of these traffic rangers.

snakeweasel

You're right, the more defensive move would be to back off and wait until the bottle neck breaks up. Then pass in a normal fashion.

driver100

You are better off getting a good used car (4 or more years old) for a few years then trading in for something newer

Practically speaking, if you think saving dollars is a priority, then it would always be better to get a four year old car. But, if you are starting a new job, and you don't want to risk getting fired because you bought a used lemon....I think the security of having a reliable car is more important than saving the extra dollars.

Chances are you won't lose the job because you are late or need time off to repair your car during the critical probationary period. I think the priority of holding on to the new job is more important than saving a few dollars, hopefully the job will work out and the extra cost will be insignificant in the big scheme of things...compared to losing the job for being late because of a used car that won't start in the morning.

I know, because I have been in that exact situation, and I leased a new car, and then just bought it when the lease was over...but by then I had enough money to buy a newcar next time around....because I still had a job.

driver100

You're right, the more defensive move would be to back off and wait until the bottle neck breaks up. Then pass in a normal fashion.

In a perfect world, absolutely. In this situation I would have followed this guy for 30 miles because he will never move over....the guy behind me is driving a big Rover and is on my back bumper, and there is a guy on the right trying to work his way up in front of the car on the left. It would be safest just to move to the right a lane and go even slower and let them all get by, but I prefer just to break away and get away from them all....and that is just me, an ex-driving school teacher and pretty careful driver (as I said, 4 speeding tickets in 45 years, less than 8 tickets total counting parking tickets. One of those parking tickets was because a very pretty female student who I was dating for the 1st time told me I could park in front of her dormitory, while I waited for her. When we went out my car had been towed away. Fine plus towing and storage charges were $250. That was our last date, and she didn't think it was a big deal - and couldn't understand why I was upset :mad: ).

snakeweasel

I would think that a good 4 year old car would be reliable, unless it was in a major accident (but there would be tells about that). We are no longer in the 70's when cars needed major work when they started getting over 50K miles.

m6vx

I seriously thought of pocketing the $, figuring the hit on value was no where near that much (turns out from what I got when selling, I was probably right), but the other guy was my son's best friend, and I thought that would be tacky!

That's where you ask for only half of the amount -- then it's win-win.

snakeweasel

I am not saying stay back behind them for 30 miles. Just until things break up and passing is easier, blocks like that rarely last 30 miles. Just sit back watch the action then when everything clears make your pass.

And even if it lasted 30 miles how much more time would it have cost you? 5 minutes, tops?

oldfarmer50

"...better off getting a good used car (4 or more years old)..."

I agree. From a practical standpoint I always went with a domestic vehicle about 5 years old and paid cash to get the most for my money. The interest savings pay for any unexpected repairs that might pop up on an older car. However, there is something to be said for that new car smell and if you just have to have it, a lease might get you where you want to be.

For me the paying of interest just drives me crazy and the only car I bought in the last 25 years that I didn't pay cash for was a 0% finance for 60 months. I had the cash on hand for that one too but figured I could give the 6% loan money to myself rather than the bank.

oldfarmer50

"...not a "defensive" move but an offensive" one..."

Heck, if you pay $40 K for a hot car and can't be offensive once in a while what's the use?

driver100

Heck, if you pay $40 K for a hot car and can't be offensive once in a while what's the use?

Now there's that wisdom we have been missing for the last few months

isellhondas

I agree with you.

From a practical standpoint, the best thing is to buy a four or five year old car, take good care of it, drive it four or five years. Sell it and repeat the process.

But, most people aren't practical.

Over and over again, I watched people buy cars they really couldn't afford. I knew they would really stretch to make the payments.

But, of course, they HAD to have the top of the line model. They "needed" a sunroof, leather, navigation etc.

A lowly LX would NEVER work for them!

kyfdx

I was reading a letter in the Roundel... a guy says the 414 hp of his BMW M3 saved his life... :surprise:

I say... if you need 414 hp to save your life, you weren't doing the right thing in the first place..

driver100

a guy says the 414 hp of his BMW M3 saved his life...

How did the 414 hp save his life? I am sure the 300 hp in ours has saved my life too.....I have needed the hp to get onto a highway for one thing. Ok, maybe I could have slowed down and waited, but that can be dangerous too. I have surged ahead of the crowd to blend in with traffic already on the highway. Not every time, but there are times when it is necessary.

driver100

From a practical standpoint, the best thing is to buy a four or five year old car, take good care of it, drive it four or five years.

In my case I had a 4 year old car that was falling apart...a Corsica with 80000 miles on it to be exact. I had a new job, and couldn't be late. The Corsica was not very dependable. To buy a new car I would have had to pay about $400 a month to own, for about 4 or 5 years (trade was worth $4000). I also had two years worth of mortgage payments to get through at the time so I was stretched. Although not a smart thing to do I put the $4000 into a lease on a Chev Cavalier, and made payments of about $200 a month. I had money left over to complete the mortgage payment, and could live comfortably with my car payment, and I had a new reliable car to get me to work. At the end of 3 years the buy back was about $4500, so I had a 3 year old used car that I knew was a pretty good running car. I liked the fact it was a 6 cylinder engine too, I think in a car like a Cavalier it will hold up better than a 4.

I really think in this case, leasing was a better way to manage my life, and I don't like to owe money. Just pay cash for cars these days.

isellhondas

I guess I should have said to buy a four year old car in good condition.

What you did worked for you at the time.

stickguy

well, you can't arbitrarily say that a 4 YO car is a better idea. Really depends on which car.

with the deals available on say a new Toyota or Honda at times, vs. the crazy prices used ones go for, new can do better.

since basically, you are looking at likely lower interest (if you finance) charges, but mostly lower depreciation. But, that is offset by (usually) no warranty, and higher maintenance and repair costs. So it isn't always cut and dried.

using the Honda example, new -> 4 YO may not depreciate as much as years 4->8, if you pay dealer rates for the 4 YO one!

snakeweasel

with the deals available on say a new Toyota or Honda at times, vs. the crazy prices used ones go for, new can do better.

While that may be true for a one year old car you can't make that claim on your typical 4 year old car.

isellhondas

No, what you do is pick a car with a good reputation that has a steep depreciation curve. Maybe a Mazda or a Saturn. Something like that.

driver100

No, what you do is pick a car with a good reputation that has a steep depreciation curve. Maybe a Mazda or a Saturn. Something like that.

And then cross your fingers and hope you didn't get a lemon...or.....lease a new car, pick something that you may want to buy back when the lease is over, and have at least 3 pretty carefree and stress free years.

jimbres

And then cross your fingers and hope you didn't get a lemon...or.....lease a new car, pick something that you may want to buy back when the lease is over, and have at least 3 pretty carefree and stress free years.

It ain't 1980 or even 1996 (the last year the Corsica was produced), driver. Unless it was abused - something that a good mechanic can detect - a typical 4-year-old car should give you years of useful service without any major outlays for repairs.

Buying new doesn't guarantee that you won't get a lemon. In fact, all of the lemon stories that I've heard from friends & coworkers involved new cars.

Leasing a car & then buying it when the lease runs out is an extremely expensive way to acquire a car. The additional dollars that you're shelling out if you go this route would pay for a helluva lot of repair work.

As it happens, I buy new - mainly because it's just about impossible to find used stick shift cars in the greater NY metro area. To get what I want, I usually have to place an order & wait 6 or 8 weeks - sometimes longer. But I also keep my cars for a long time: at least 8 & usually 10 years.

roadburner

I say... if you need 414 hp to save your life, you weren't doing the right thing in the first place..

Yep. Horsepower can hide a multitude of driving sins. I learned much more about high performance at the wheel of my 139 bhp Club Sport than I ever did when tracking my 300+ bhp M6.

stickguy

to me, was always 3 years, not 4. For a while, I had a plan of buying a 3 YO car, keeping it 3 years, and selling it and repeating the process.

worked out fine for reliability, etc. But actually not so well depreciation wise. Meaning, at 3, they were still kinda "newish", and maybe under warranty. But by 6, they were rapidly approaching old age. And the depreciation hit could be bad, if you bought something that started out fairly expensive. To the point where it might have been cheaper to buy new.

4-7 though might have been better.

I came to believe (and I think someone here might have supported or proven it) that cars don't depreciate liner-ally. Rather, while they do drop year to year, there are also some steep cliffs, where they had an extra big drop. Kind of like crossing the border from new/middle aged, and MA/old. Like when they hit 100Kk, and fall off the face of the earth.

driver100

I came to believe (and I think someone here might have supported or proven it) that cars don't depreciate liner-ally

The biggest hit in depreciation will be in the first 2 years....many cars drop 1/4 of their value when you drive them out of the showroom. So, the ideal used car is probably about 2 years, that way you still have lots of years left in it.

I am not against used cars. Most of mine over the years were fine cars, with a few exceptions I just like having a 4 or 5 year warranty and the reliability of a new car....and I am willing to pay for that. If I was concerned with getting maximum use of my money I would buy used too......no problem.

My son in law bought my 04 X3 when it was 3 years old, he leased it for 3 years and hasn't had a problem, and now he is going to buy it....just had the safety check. I don't know if I would do that, it has 90k miles on it, but it looks and rund like new.

snakeweasel

Yes horsepower can hide a lot of driving sins but sooner or later you pay the piper.

snakeweasel

Currently cars do hold up very well, the last several cars I have owned all wet past 150K mies with little or no trouble. A car that is 3 or 4 years old should be very reliable unless someone drove 30-40K miles a year or damaged it in some way.

driver100

A car that is 3 or 4 years old should be very reliable

Good point! I forget that todays cars are a lot more reliable. When I think of used I think of some of the used cars I have had, 65 and 67 Galaxie, 72 Comet, and my first new car was a 73 Maverick.......I had to commute an hour each way and the used cars just couldn't be counted on.

So, I'll agree used is fine, if it suits you.

mako1a

If you step way back and look at almost every car as having a value of $1500 (in time).
There is also a temporary window of value at suggested retail price, but it's short term.

driver100

There is also a temporary window of value at suggested retail price, but it's short term.

That sounds interesting, but please explain it more. I still like your theory about if you are too concerned with little amounts of money, you will never accumulate large amounts.

jayrider

The used car you want is the one I owned from new. Well maintained -- never abused-- no kids, pets or smoking. Nothing for sale at the moment. :shades:

sterlingdog

Well, we're still in the mountains after deciding to stay over a day or two. As for used cars, our two year old SRX is doing great on its first trip. I'm not thrilled with the gas mileage, but I didn't purchase it for that reason. It drives beautifully and handles these mountains really well, especially with the V8. I ran into a fellow SRX owner at Grandfather Mountain. He was telling me that his Cadillac dealer has had an unusual experience. Two customers purchased the 2010 newly designed SRX. They both told the dealer that they want to trade them in for the old 2009 model design. He said that this type of thing has not happened in his 30 years as a dealer. Wonder how that kind of trade in would work? Would you be upside down or sideways or just plain crazy? As I mentioned before, my own dealer has a waiting list of four people looking for an '08 or an '09. We were certainly fortunate to have found one that we really liked and in such wonderful condition. So far, so good.

Richard

driver100

As for used cars, our two year old SRX is doing great on its first trip

Glad to hear the car is running great and you are a happy camper, er Hotel stayer would be my guess...not to many people camping with an SRX I imagine.

Do you like having the extra horsepower for safety reasons? Today, I came out of a side street that has a big curve you can't see around. I started to make my left turn and then saw a car coming pretty quickly (faster than he should have), so I used my extra horses to get across the road and speed up so he didn't even have to brake. I would hate to have an underpowered car in that situation.

isellhondas

I can't think of any time in my driving career where I've needed a lot of power to get out of a situation.

Maybe someday?

bronsonb

We had a similar experience to firefighter with Sirius. When the 6 month trial period ended, I wanted to renew it for my wife who does use it a bunch in Atlanta, but the price was too high (somewhere around $140). Even paying a whole year in advance didn't save much. So we let it cancel.

A week or two after it canceled, Sirius called and offered it to us for a year at $77 if we paid in advance. I said sure, and we signed back up. My wife said it was worth $77 to her but not $144. She said there are too many commercials for it to be worth $144. I sometimes wish I had it, but I am not in the car nearly enough to make it worthwhile for me. Wife has 20 - 40 minute commute each way, sometimes longer. So she does get to enjoy her drive a little more.

oldfarmer50

"...The used car you want is the one I owned..."

One of the regulars, Jip, Snake or jmonroe claimed that he changed the oil in his car every 1500 miles. THAT'S the car I want. If I were going for just the looks I'd buy one from jmonroe because it would take YEARS for the elements to get through the six inches of wax.