Did you recently take on (or consider) a loan of 84 months or longer on a car purchase?
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Stories from the Sales Frontlines
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Maybe I'm just remembering my diesel Peugeot that I once owned of maybe my general dislike for modern Volkswagens?
I still think the cons outweigh the pros but I suppose I could change my mind at some point.
My understanding is that Honda is going to be bringing the diesel to the US. Better get on that diesel happy face. :P
The diesels of old are nothing like today and with the clean diesel the smell is almost gone.
Is that trucks and SUV's only????
We can still do leasing, but the rates are fairly high , and that's on all Chrysler Dodge and Jeep products right now.
Just as others have said, it's tha fact that the market is saturated with leases that are about to mature, and the vehicles will take huge hits at the auctions, way below what the residual values are set out on them.
I think Chrysler is just bracing themselves and tries to minimize future losses due to lease returns, by discouraging it at the moment. I have a feeling, others might follow suit, like someone said, with Honda Pilots, same kind of situation (worth less than residuals).
It's unfortunate for the short term, but I think the compnay is looking at the long term picture.
I think in the next 10 years you are going to saee the whole automotive landscape totally reorganized, and not just with product lines (hybrids, electrics, subcompacts), but also with new companies (Chinese, Indian automakers possibly?), with duplicate model lines and maybe even whole divisions being canned and slimmed down (Mercury anyone?), and with the way they're being sold and marketed, because of current instability, and unpredictable future.
It should be interesting to see.
On a side note, it's funny that Ford after taking their gazillion dollar losses in the last quarter, is now talking about importing models from Europe. Weren't all of the auto magazines, and enthusiasts asking for that years ago instead of being fed with watered down versions specific for the "american market"?
If they would have done that 10 years ago, I would probably be working at Ford now, selling Focus RS models, Cosworths, Ka, Fiestas, and their other funky cars they have in Europe.
It should be interesting to see how we (Chrysler) tough out this year without subvented lease rates. :confuse:
2016 Audi A7 3.0T S Line, 2021 Subaru WRX
Example 1: (made up example, but we hear about this a lot)
Customer has a 2005 Chevy Tahoe they purchased new for, let's say, $38K. It's in good shape, but the gas mileage is 15mpg on its best day. They trade it for a new Hyundai Sonata V6 (because they don't want to step down too far), which costs about $23K. The Tahoe is valued at $15K trade value, and they owe $20K on it. PS - The new car gets about 23mpg. How many miles will the customer have to drive to start saving money? Well, the cost of purchasing the new car is $28K, when you count the negative equity, and the mileage increase is 8mpg, so at $4.50 per gallon, you'd have to drive the car 268,333.3 miles BEFORE ANY MONEY is saved.
Example 2: (this one happened to me)
My (now ex-) brother-in-law is a fickle person. He would wear a leather jacket once, nice clothes not even at all, and got tired of his cars quickly. One day, he decided to buy a new Jetta diesel (for the fuel savings). My car at the time was my wife's old Civic with no A/C and it was very low to the ground, so I offered to buy his Corolla. That Corolla had 63K miles on it then. Six years later it now has 196K and runs like a champ. At the time, it got about 40mpg, and the Jetta was rated at 49mpg (that was the old EPA number) so even if the price of gas and diesel were the same, he still had to overcome a $16K deficit after the sale of the car. Needless to say, he got tired of that car, too (and I believe has had seven since then). I still wear the clothes, too
Don't forget to add the finance charges. That will certainly add up and push back your break even point!
1/3 in 3 months.
That's an excellent point - I just figured 288K miles was already more than most people would drive a car anyway. I also didn't figure in major repairs for the same reason.
That's exactly what happened to me at a VW dealer. The only difference, I was there in 1979! It seems the VW dealers get very snooty during oil shocks.
If it's any consolation, 2 years later when the diesel frenzy subsided the same VW dealer was begging people to take his diesel cars and no one wanted them. They had all sorts of discounts and special financing and they still couldn't move them.
If you can wait you'll do a lot better.
2019 Kia Soul+, 2015 Mustang GT, 2013 Ford F-150, 2000 Chrysler Sebring convertible
Not many of you will remember this but years ago your average Joe did not EVER buy a new car unless they really, really needed one. If the one you had got wrecked, stolen, or just worn out you HAD to buy another car or truck. But only if you actually needed one. Many people did not even own one and any family that had 2 were really wealthy.
Now we will buy a couple of new $35 or $40 thousand cars like we are buying a pair of shoes, keep them for 2 years, get tired of them and do it all over again. Then we might buy a 3rd one just to drive on Sunday.
I have heard many people say that a new car will be your second biggest expense, second only to a new house. That is wrong and not even close. New cars will be your biggest expense by far. Most people actually make money on buying and selling their homes. Not so with cars unless you are a very savvy collector.
I am as guilty as anyone else so don't think I am preaching. I blame it all on the car salesmen. Those guys are good!!
2013 LX 570 2016 LS 460
Soon, 36 months became the norm.
When I was in H.S. I remember a friend of my mother's showed up with a spiffy new 1965 Thunderbird. I was so impressed!
After she left my mother said..." Anybody can make car payments"
She went on to tell me that this lady was going to be making payments of over 100.00 a month for FOUR YEARS!
I couldn't comprehend at the time how anyone could do such a thing!
Well, now the "normal" car payment is for 60 months and I get a lot of people who want to go 72 months or even 84 months!
I try to talk these people out of this but when I suggest maybe a lesser model, I usually get a blank stare.
You see, they HAVE to have leather, sunroofs etc....
Cars have changed a lot over the past 15 years and it seems like a good time to buy a car as it is a buyer’s market.
The criteria for the new car is; Security and comfort, Smooth comfortable ride, Fuel economy, Reliability and Price. I would prefer to stay with a domestic brand.
Considering the current offerings, the only car that fits and most importantly, what the wife likes, is the Taurus or the Sable.
Joel, to bad you’re so far away, you could have a sale next week.
Most of ours are 72-84 months though.
On a side note, I saw a 99 Ferrari 550 on eBay, and the dealer will finance for 144 months (12 years) @$800/month, with 20% down.
It's like half a mortgage. :surprise:
2016 Audi A7 3.0T S Line, 2021 Subaru WRX
I'm puzzled by this logic. Wouldn't it be better to showcase your smaller fuel efficient cars to get the customers on the lot? Then once they are there the sales people could "suggest" buying a larger vehicle.
As it is the place looked like a ghost town on a Saturday afternoon. :confuse:
2019 Kia Soul+, 2015 Mustang GT, 2013 Ford F-150, 2000 Chrysler Sebring convertible
Rich definition please....
Moo- no disrespect to you... I only went to public schools
If you showed up 4 days a week you got a b average for a grade. Never attended college but you guys probably already figured that out.
Well I did sign up for college even paid my first semester but if you were absent too much they still said thank you but you can't get credit for these classes... :sick:
Funny thing was I could still pass the tests showing up once a week.
To keep on topic... I couldn't afford a car my first year of school.
I was busy working and ummm maybe a little partying
GP
Think of it like this.... "out of site out of mind"
They are trying to get people to look at these vehicles so they think of them.
Alot of time dealers will put "old age" units in the show room. There is alot of truth to people will buy what they see. We do it at our dealer all the time and it works!!! We will put a car in the showroom that nobody has opened the doors on in a few weeks. People sit in the showroom and they that vehicle sitting there and they have to have it :shades:
GP
Back in the "old days" a radio and a heater were a big deal!
" I'm In MA, and diesel is about 80 cents a gallon more than RUG. Not much incentive here to go diesel power. "
Here in Houston , Tx too.We brew it out here and our air quality reflects it. 2008 has been such a weird year. Full of anomalies.The credit game finally blows up, The speculators, pension funds and Wall St. game oil and start an oil bubble.The faux recession announced earlier this year in an attempt ( and successful one!) to bully the fed not only exacerbates inflation but adds to the real assets mind set which spurs inflation more ,resulting in a real recession though probably short. Diesel is of course be the lowest step in the refinery process and should of course logically, the cheapest. Due to the weak dollar the manufacturers of clean diesel cars and trucks have biased their sales effort away from the US. Refineries orienting toward demand have shifted the mix toward gasoline resulting in competition in the gas end and very little in the diesel side.Voila' an abberation where the cheapest stuff to produce costs more than the more costly.But abberations are exactly that and have no long term sustainability.
The clean diesel technology as some posters have commented on, are not the nasty Rabbits of yesteryear. Low sulfur producing in emissions, they get great mileage and the engines last a long time.imho, it was a more logical next step than fuel cell which so far while having the most enviromental benefits,cost more in terms of energy to produce hydrogen and as such are not the most fuel efficient, They just shift the energy cost off the auto side to the homeowner side. Fuel cells require natural gas to convert and platinum as the catylyst . What a rant! Jumping off the soapbox.
"I know we've had this conversation before, but isn't buying a vehicle "for the mileage" quite possibly the dumbest thing you could do, except in very rare cases? I offer the following two examples to illustrate "
Right on mon frere, people do very irrational things when a basic commodity escalates. hell if you owned a hummer, it would make more sense to grimace but fill it then take the current trade in. Granted you bought an military surplus vehicle, for what viable purpose? But even given that you had a lapse of intelligent judgement, figuring the breakeven period for a reduced trade in should ,make you take pause and do the math.But like the stock market, we vote with our emotions first and our logic second.
Poor Chrysler, years ago in the worst of times they had to sell their single letter stock symbol, C
Those were the best of times for Chrysler. They got rid of their C because of the DC "merge of equals" and the new company name.
At the time Chrysler had more cash reserves than just about any other car manufacturer. Daimler noticed this and decided to raid the piggy bank and get out. It worked for Carl Icon with TWA and they figured it would work for them, too.
Even Carl Icahn, not too much but occaisionally get screwed every now and then.We are awestruck at the Mercedes- Daimler name. Oh they are so smart they can do no wrong. You have a high end American presence and you need to buy Chrysler for exactly what reason ? I need say no more.
I think it would be great to be able to buy the Jetta TDI for MSRP or less, and fuel it with diesel that was cheaper than gas. A win-win situatuon, but that would be logical and make sense, so there's no point in doing that.
Not necessarily so. I have a friend with an Odyssey about to come off a 48 month lease. Residual is around $17K and it's worth about $11.5K. He intends to buy the car out at the end of the lease. I mention this example because it's a Honda, other makes will likely be worse but I expect some of their owners will buy them out too.
it for $500 over what the dealer paid Honda. Or, scrap a minivan all together
and go for a CPO 5 series wagon, finance it, and enjoy!
hhhmm, BMW!
Sounds like a good argument for a huge showroom with lots of seats.
One local dealer tried something like that when he opened a used car store inside a mall. I admit it was eye catching seeing the cars close up as you walked by. Must not have been profitable because the store closed quickly and that dealer has since sold out to another group.
2019 Kia Soul+, 2015 Mustang GT, 2013 Ford F-150, 2000 Chrysler Sebring convertible
Help me out here. I'm just a dumb 'ol farm boy and there's a lot about leasing that I don't understand.
You're saying that your friend plans on paying 17K for a car he knows is worth 11.5K? If I'm understanding your terms that guy is stupider than a tree stump. :confuse:
2019 Kia Soul+, 2015 Mustang GT, 2013 Ford F-150, 2000 Chrysler Sebring convertible
Like Forrest Gump said, "Stupid is as stupid does"
I once had a salesman try to steer me into a "pre-owned" car. I said that I wasn't interested in a used car. his response was that it wasn't used it was pre-owned. I said same difference, he kept insisting that it was not used but pre-owned :confuse:
2011 Hyundai Sonata, 2014 BMW 428i convertible, 2015 Honda CTX700D
Well me and the wife have determined that next summer we get a new car. Since this would be my daily drive she has few limitations on what I get but it must include a sunroof.
Personally I cannot see getting one especially since a lot of cars you have to get other options I really don't want. So getting a sunroof adds 2 to 4 grand onto the car. :sick:
2011 Hyundai Sonata, 2014 BMW 428i convertible, 2015 Honda CTX700D
Other people will add a year to their contract just to have the sunroof.
I have one and rarely open it.
That's because you live in Washington State. :P
Sorry, I like most people cannot afford to buy stuff I know I will never use.
One car to get the sun roof I would among other things spend $300 for an audio upgrade and $150 for satellite radio (that I know I will never use).
But my point was that you just can't get certain things, sometimes you have to spend even more money to get required unrelated things. I mean why do I need a 100 watt stereo system with a sun roof?
Or a better example is why do I need a leather wrapped steering wheel with audio controls and blue tooth capabilities if I just want fog lights?
2011 Hyundai Sonata, 2014 BMW 428i convertible, 2015 Honda CTX700D
Now that I know your hands are on those aircraft engines, my frequent flyer miles don't look so attractive. :P
Speaking of details, you need to remember that we no longer use "sics" on this board. Perhaps you're not giving the posts your usual attentive nature.
Richard
I have a friend that is an electrician, he works with some high specialized equipment that is high voltage and wattage. He says he has never made a mistake because when he does wrong he vaporizes.
2011 Hyundai Sonata, 2014 BMW 428i convertible, 2015 Honda CTX700D
Honda gives their customers the first three months free and very few don't get hooked and sign up when the trial period is over.
XM radio is a wonderful thing!
The Sandman
The next car is ging to have one.
First, it is spelled "analOgous". Moo was trying to point out how two things are pretty similar or like one another when you take all values in to consideration. For example, the $2,000 car financed for 24 months is similar to a car financed today for 60 months when you consider prices, salaries, dollar values, etc. between say 1950 and 2008.
The actual definition is: "Showing an analogy or a likeness that permits one to draw an analogy." I hope that my explanation helped.
BTW, it doesn't matter to us that you went to public school or didn't attend college.. The important thing is that you like to learn and that you don't mind asking. I could be wrong, but you are probably more ready now for college than you ever were before. Don't try it for the status it brings. Try it because you're interested and curious to learn more. Why not try a night course or two at your community college? You might enjoy it. I suspect that you're a pretty smart kid from what I read here. :shades:
Oh, I nearly forgot. When you call out a person's name in writing, place a comma after the name. Example: "Rich, definition please."
Richard
As for talk radio satellite doesn't carry who I listen to and as for music I have a rather extensive collection of what I like. I really can't see paying for what I can listen to for free.
Most people I know that had the free subscription let it expire.
2011 Hyundai Sonata, 2014 BMW 428i convertible, 2015 Honda CTX700D
Useless junk. I had a friend who had Bluetooth, but he went to the dentist and got it fixed.
I did want a sunroof and would have been willing to take the junk to get it but the sunroof lowered the head room too much. After hearing other people talk about how they leak and make the car hot I'm glad I didn't get one.
I also don't see the point with nav systems. Maybe if I traveled to strange cities often it would come in handy but I have a feeling it would take so long to learn how to use it I wouldn't have time to make the trip. For now I'll use my old-fashion $1 nav system that folds up in the glove box.
2019 Kia Soul+, 2015 Mustang GT, 2013 Ford F-150, 2000 Chrysler Sebring convertible
When I know that my sister is going to ride with me, I drive the convertible. In the Explorer, she might try to turn on the XM. :surprise: What would I say? I guess that I could say that I didn't make last month's payment. :P
Richard
Richard
I have a small inexpensive portable one I use. Its good for finding places that I have never been to even if I am familiar with the area.
There have been a few times in real bad weather that I punched in the place that I have been to hundreds of times only so it can alert me when I turn was coming up. That was good as visibility was very poor and I was paying more attention to the traffic then where I actually was.
I have also used it going to places that I was at once or twice just to remind me where to turn.
A few times I used it to find my way around road construction or blockages (i.e. accidents),
2011 Hyundai Sonata, 2014 BMW 428i convertible, 2015 Honda CTX700D
" I once had a salesman try to steer me into a "pre-owned" car. I said that I wasn't interested in a used car. his response was that it wasn't used it was pre-owned. I said same difference, he kept insisting that it was not used but pre-owned ."
And not only was it pre-owned not used, I bet it had great , good or nice miles on it . As opposed to strenuous, mean or nasty miles.
I have a Garmin that I use occasionally. The first time my wife was with me when I turned it on, she wanted to know how it knows where we are. :surprise:
2025 Forester Limited, 2024 Subaru Legacy Sport