Rebates, Incentives, APRs - Questions & Comments

charlotte7 · September 2005

Did GM really cut it's prices on most, or all models? If so, what's the average amount they cut the price by? It doesn't seem like most of the models are significantly cheaper to me. Do they still expect that people will be haggling for a lower price on the "value priced" models, even without incentives? Otherwise, doesn't this idea turn GM into one giant Saturn dealer?

dino001 · September 2005

What I understand they want is to make us believe that they are interested in bringing transaction prices closer to stickers. They did cut some prices, indeed. However, what they actually did more often is added some significant content, esp. in "upper shelf" models (Saab 9-3, Buicks, Cadillacs), improved warranty (Buick, Cadillac I think), thus effectively brought the sticker price down for given content. If you compare similarly equipped 2006 and 2005 Saab 9-3, the difference is well over 2 grand, I think. For Vibe, I do not believe there is much difference.

With reducing haggling, I don't believe it will happen anytime soon. I don't expect them doing it - too much at stake and too big resistance on either side. Price haggling seems to serve dual purpose for dealers: 1. reaching agrement on the price 2. wear the customer down so he/she will fork over more at F&I. Thus, taking item 1 away makes item 2 more vulnerable to flat out "no". Ask yourself how much easier is for you to walk away from Jim's Chevy if you know Joe's Chevy has the same price and you spent at Jim's only 15 minutes because the price was already set than after 4 hours of arguing about last $150 on the price and having to start over at Joe's after you discovered that they approved you for "great" 9% APR and just put on their "standard" appearance added to each vehicle?).

And there are also customers with mindset that fair profit is a loss of $1000. They wouldn't like the system gone either. Bringing MSRP down will give manufacturers some justification of reducing/eliminating incentives, at least for now until lots build up 120+ day inventories again. They will do a lot of smoke, but bottom line is, if they really wanted to do it, they would have to cut margins to the bone and/or bring Saturn/employee pricing purchase model everywhere: Show the customer real car invoice, put standard (and same) markup for everyone, dont' pad any junk fees and put straight (and truthful) ads without confusing terms, bait and switch phantom cars, or fine printed $3000 "trade allowances". That would be the end of the world, wouldn't it

digitalgravel · September 2005

I have 3 in mind. Either NetBank, Capital One Auto Finance or Eloan. Any info would be greatly appreciated.

qbrozen · September 2005

I've used both Eloan and CapitalOne. Both are easy to apply for, quick to approve, and have identical rates last time I checked. Most recently, however, we did NOT get approved for CapitalOne's advertised lowest rate, while Eloan did give us their lowest rate (the same low rate CapitalOne wouldn't give us).

esvcaddy4me · September 2005

We are looking at trading our '04 Z71 Burb for an '05 Cadillac ESV. I am trying to decide if we should try to get in on the Employee price $52, 967 all options or wait and see what happens since it is an O5. I'd like to wait a little longer and I am thinking maybe they will have a better deal since it is an 05. I read that the 07 ESV with a redesign may be out in Spring 06. Any thoughts on this or does anyone know of what will happen after today for the employee pricing? Thanks

nortsr1 · September 2005

Your a going to be a "day late and a nickel short" if you wait much longer.

dardson1 · September 2005

Since you obviously are not desperate to trade, you are in a position to wait. I'd bet you are right. If you're wrong, so what. While I understand Cadillac is a slightly different animal, the ESV is basically an upscale Suburban. I've been in the market for a new Tahoe since May. In June and July the inventory dropped via the Employee Pricing Program. I'd guess everyone on the fence pulled the trigger. Nevertheless, I still see many of '05's that were there in May still on the lots (I probably know my local inventory better than any salesman on the lots). They gotta move them, eventually. When you add in current fuel prices + the general consumer pessimism, they're bound to do even better on the remaining '05's. We shall see over the next few weeks. Good luck.

jamesam · October 2005

I'm pricing the G35, and considering the AWD model. MSRP is $33,710
Invoice is $31,052. How much should I exepect to pay? Edmunds says expect to pay the full MSRP. That's a dealer profit of $2,660 BEFORE the holdback!!!!
(FYI-- located in Boston area)
All advice is appreciated

CarMan@Edmunds · October 2005

You're welcome nortsr1. Let me know if you have any questions about GM's new incentive program that was just introduced on Friday.

Car_man
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CarMan@Edmunds · October 2005

Hi jamesam. Infiniti's September incentive program on the 2005 G35 was scheduled to run through today, October 3rd. The only incentive that it is offering on '05 G35 AWD Sedans through this program is 1.99% financing for up to three years or a special lease. It is difficult to say what Infiniti's October lease program will be like on this car when it is published tomorrow. Please feel free to check back with me in a day or two and I will be more than happy to fill you in on the details.

As far as how much you should pay for this car goes, you definitely should not pay full MSRP for it. You may be able to get an idea of what sort of price you can expect to pay for one right now by visiting the following discussion: "Infiniti G35: Prices Paid & Buying Experience".

Car_man
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nortsr1 · October 2005

Yes, I do have a question about the new GM incentives that just came out.
There is a $500.00 incentive on the 2006 Vibe... OR.... 1.6% financing. Yet, on the 2005 Vibes, there is NO incentive and 6.9% financing. That just doen't make sense to me unless GM is now offering the dealers XXXX amount of money to get rid of the remaining 2005's. Of course, that is one of those monies that we are not privy to. Your opinion please.

digitalgravel · October 2005

The only rebate they offer is the 500 cash back to customer which was from (start: 07/06/2005 end: 10/03/2005). Now that thiS promotion has come to an end what will the next promo be? Hopefully they will have some type of incentive on the financing, but unlikely. Anyone have any info on this matter?

exitus · October 2005

What is the difference between a manufacturer's rebate and a dealer rebate?

Manfacturer = Toyota/Ford/GM/etc.. to customer (thus lowering the MSRP)?

Dealer = dealer to customer (does not lower MSRP, just what they sell the vehicle at)?

Thanks,
Exitus

dino001 · October 2005

MSRP is not influenced by any rebates. It is set for a model year and stays unitl adjusted ("permanently). Rebates are temporary discounts of the price. The difference is in the profit margin of the dealer.

You can compare a manufacturer's rebate to a coupon you get from Tide for a box of a detergent. It should have no influence on dealer's nominal profit, unless the manufacturer asks for a participation (sometimes happens). Dealer sometimes (rarely these days) try to "steal" this money from less informed customers, which you can compare to a store cashing the coupon with the manufacturer.

Dealer's discount is simply an advertised discount given by a dealer over a list price; like a refrigetrator with a list price of $1000 but local SEARS tags it for $950, Best Buy for $920. Simply cuts nominal profit margin, usually in place due to presence of dealer's incentives, competition from other dealers/sellers or some undesiribility of the sold product. As you know, almost no one would cut their profits voluntarily.

Dealer incentive, also called marketing support, is money provided from a manufacturer to a dealer to give them more pricing flexibility, i.e. allow for deeper discount on the price (from usual discounts, if they apply). Dealers can, but don't have to charge lower price on the product, having same margin on profit as before the incentive. Conversely, if they charge list price, their margin becomes higher.

People sometimes take discounts for granted, i.e. they actually think dealer has to charge less than MSRP, like it was the law. In fact, they don't, they may even charge million dollars for this Chevy Cobalt, if they think somebody will buy the product. Well, maybe not, but you get the idea: with some constraints in place, they can pretty much charge whatever they like. It is up to customer to say year or no.

mldj98 · October 2005

Is there anyway you can tell me what the additional charges they place on the invoice price for the toyota's that are sold in the southeast region?
I think there is an additional freight and maybe administrative charge....not sure.
Thanks

CarMan@Edmunds · October 2005

Nortsr1, when General Motors ended its Employee Purchase Program on 2005 models, it replaced it with dealer cash rather than consumer cash. That is why it looks like it is not providing any cash incentives on the 2005 Pontiac Vibe. GM is currently providing $1,500 dealer cash and 6.25% financing for up to 6 years on the '05 Vibe. Make sure to take this money into account when negotiating your deal on this car.

Car_man
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CarMan@Edmunds · October 2005

Hi digitalgravel. In October, DaimlerChrysler is again providing $500 in cash incentives on the Chrysler 300. On the 2006 model this incentive comes in the form of dealer cash, while on the 2005 model it is bonus cash. Unfortunately, it has not introduced any special finance rates on the 300, but it does have a special lease program on it.

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CarMan@Edmunds · October 2005

Hello Exitus. Automakers basically offer two types of cash incentives on vehicles, customer cash and dealer cash. Manufacturers advertise customer cash incentives and consumers are automatically entitled to them. On the other hand, dealer cash is under the table money that is given to dealers on vehicles to use as they please. It is not advertised and dealers are not required to share it with consumers. They are free to keep all, part, or none of it for themselves. If you know about dealer cash, you can use it to your advantage during negotiations to lower your vehicle's selling price. Both of these types of incentives are paid for by manufacturers, not dealers. Dealer cash is different than a dealer discount where a dealership is cutting into its profit margin to provide you a discount on your vehicle.

Car_man
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nortsr1 · October 2005

CarMan,
A follow-up to your post #3337. Besides the $500.00 rebate now in effect for the 2006 Vibe....GM IS allowing the Conquest $1000.00 incentive for a non GM vehicle. I just received word from a dealer. They sure don't make it public knowledge!
The only way I discovered it was the fact that someone posted the details of their deal on a 2006 Vibe at the "Pontiac Vibe prices Paid" topic at the Wagons forum and it included the Conquest incentive. I then emailed a Pontiac dealer and they verified same.

mldj98 · October 2005

Is there anyway you can tell me when the release date will be for the 06 Honda Element? For not only pricing and incentive info but also for the actual production and delivery to the dealerships....thanks.

CarMan@Edmunds · October 2005

Hey nortsr1. The saga continues... GM finally did introduce $1,000 conquest cash on both the 2005 and 2006 Pontiac Vibe a week or so ago. However, yesterday, it reduced its conquest offer on these models from $1,000 to $500. Yuck. A number of other manufacturers have reduced their incentives on smaller cars as well. I suspect that this is in response to increased demand for fuel efficient vehicles because of high gas prices.

Car_man
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CarMan@Edmunds · October 2005

Hi mldj98. The latest that I have heard is that the 2006 Honda Element is not scheduled to arrive at dealers until mid-January. I suspect that Honda will publish pricing for this model shortly before then, but I highly doubt that it will initially provide any sort of incentives or lease support on it. For more information on the Honda Element, make sure to stop by the following discussion: "Honda Element".

Car_man
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landdriver · October 2005

Am interested in a Ford Ranger -- although I'm aware rebates generally increase later in the MY, was curious if there are any rebate trends unique to this vehicle or Ford in general. Currently (in CA) the 2005 Ranger rebate is $3000 while the 2006 Ranger rebate is $1500. I prefer to get an '05 and save the extra $1500 but most '05 Ranger stock appears to be sold out. Will I have to wait till the end of next year for a $3000 rebate to roll around again?

Also a search of this board indicates there was a $750 rebate toward the end of the '99 Ranger MY, which makes even $1500 sound good. Have rebate amounts for the Ranger gradually risen over the years, or is the $3000 rebate amount unusually high for this year, possibly an after effect of the employee discount programs?

Thanks for any insights in advance!

CarMan@Edmunds · October 2005

I just thought that I would add an update to my previous statement that the 2006 Honda Element will not arrive until mid-January. Apparently the information that I heard was old, I told you that it was just "The latest that I have heard..." :P. As another community member kindly :mad: pointed out, the 2006 Element will apparently begin to arrive at dealers sometime in November. Sorry for the confusion and thanks for the information so_cali.

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CarMan@Edmunds · October 2005

Greetings landdriver. You beat me to the punch, I was going to start my post by saying that many dealers are already sold out of most of their 2005 Ford Rangers. Vehicles incentives generally tend to increase as the model year progresses, so logic dictates that the later in the model year one buys the higher the incentives that are available on the vehicle that they are interested in will be. Of course, there are exceptions to every rule, but this is usually how incentives work in the auto industry. The problem is that consumers who wait too long to buy run the risk of not being able to find the exact combination of color and options that they want for their vehicle because dealers inventory is running low. This year, Ford's customer cash incentives on the 2005 Ranger did not hit $2,500 per unit until July, which is also when Ford introduced its "Family Plan" program. I suspect that Ford's cash incentives on the 2006 Ranger will eventually hit the $3,000 per unit level, but it is difficult to say when this will actually happen. If I had to make an educated guess, I would say that the '06 Ranger's incentives might hit this level by May or June of next year, but again this is only a guess. Not even Ford itself knows what its future incentives will be like on vehicles. This sort of thing depends upon a number of variables such as what its inventory situation is like, how strong the market is, what gas prices do, etc...

Car_man
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landdriver · October 2005

Thanks Car_man!

dmitchell4 · October 2005

Hello all -- I think the answer to this is no, but here it goes anyway.

Ford is offering 0% financing for 72 months on some 2005 models. I'm looking at a 2005 Ford model that is not listed as eligible for the 0%/72 month financing. Are dealers in any position to secure the 0%/72 month financing on models other than those listed by Ford? Even if they wanted to, could they get the special financing on non-incentivized models (by getting some sort of waiver or special app from Ford)?

Thanks in advance for any insights.

CarMan@Edmunds · October 2005

You're very welcome, landdriver.

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CarMan@Edmunds · October 2005

Hi dmitchell4. Ford in currently only offering 0% financing for up to 6 years on a select few 2005 models, such as the Explorer and F-150. This program is completely paid for by Ford Motor Company and unfortunately, dealers do not have the authority to offer it on any other models. Most Ford vehicles have some sort of cash or special financing rates available on them right now, especially 2005 models. While there may not be 0% financing for 5 years on the specific model that you want, there still may be some attractive offers. If you don't know what Ford is currently offering on the exact model that you want, let me know what it is and I can give you an idea of what its current incentives are like.

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dmitchell4 · October 2005

Car_man -- Thanks much for the info and quick response! The models I have in mind have good incentives, but wanted to see if I could legitimately push the dealer to extend the 0%/72 months. Glad to have the confirmation that the dealer, who told me he can't, is operating in good faith.

Much obliged!

pdurant · October 2005

Hey CarMan,

Can you please provide the current incentives on the 2005 and 2006 Jeep Grand Cherokee. I see one thing listed on the website and then I have seen TV commercials that say something different.

Thanks for your help!

ws63 · October 2005

Hello Car Man,

Do you have any information on Ford's near-term incentives for the 2005 Freestyle? I was wondering if sluggish sales would bring the current incentives closer to the Family Plan prices offered previously. Thanks very much in advance for your help and the informative forum.

CarMan@Edmunds · October 2005

You're very welcome dmitchell4. Let me know if you have any other questions.

Car_man
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CarMan@Edmunds · October 2005

I'd be happy to pdurant. Right now DaimlerChrysler is providing $3,500 customer cash OR 0.0% financing for up to 3 years, 0.9% for 4 years, and 4.9% for 5 years plus $2,000 customer cash OR 2.9% financing for 5 years and 4.9% for 6 years all by themselves on the 2005 Jeep Grand Cherokee. It also is providing an additional $750 cash on '05 Grand Cherokees that are equipped with V8 engines. Last week, it added another $1,000 loyalty cash for returning customers.

On the 2006 Jeep Grand Cherokee, DaimlerChrysler is currently providing $2,000 customer cash or 2.9% financing for up to 3 years, 3.9% for 4 years, and 4.9% for 5 years.

Both of these trucks have special lease programs available on them as well.

Car_man
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CarMan@Edmunds · October 2005

Hello ws63. After it canceled its Family Plan program, Ford introduced the always popular 0% financing on its 2005 models to help dealers sell their remaining inventory. It is currently providing 0% financing for up to 5 years or $500 customer cash on 2005 Freestyle LTD and $1,500 on Freestyle SE and SEL models. If I was in the market for this model right now, I definitely would go with the 0% financing.

Car_man
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ws63 · October 2005

Car Man,

Thanks very much for the information and recommendation. It's quite helpful.

CarMan@Edmunds · October 2005

Hello ws63. After it canceled its Family Plan program, Ford introduced the always popular 0% financing on its 2005 models to help dealers sell their remaining inventory. It is currently providing 0% financing for up to 5 years or $500 customer cash on 2005 Freestyle LTD and $1,500 on Freestyle SE and SEL models. If I was in the market for this model right now, I definitely would go with the 0% financing.

Car_man
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fxsport · November 2005

Hey-
Can you help me out with the info on November Jeep Grand Cherokee deals for 2005 and 2006's. Financing, rebates etc. Also, if possible do you have the lease deals? I'd be looking for around 36 months with 10k and/or 12k miles.

Thanks Car_man!!

xeo · November 2005

Does anyone know what the ncentives are for the Mazda6 and 2006 Hyundai Sonata in November?

CarMan@Edmunds · November 2005

I would be happy to help you out fxsport. The only incentives that DaimlerChrysler is currently providing on the 2006 Jeep Grand Cherokee is $2,000 customer cash and a special lease program. On the 2005 model, it is offering 3.9% financing for up to 5 years or $3,500 customer cash on the Grand Cherokee Laredo and $4,500 on the Limited or a special lease.

To give you an idea of what this truck's lease program is like, I need you to be as specific as possible about the model that you want. For example, do you want an '06 Grand Cherokee Limited 4WD, an '05 Grand Cherokee Laredo 2WD, etc... Once I have this information I will be able to help you out. It would be more appropriate though if you would post any questions that you have about leasing in the corresponding discussion on the "Prices Paid: Buying & Leasing Experiences" message board.

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CarMan@Edmunds · November 2005

Hi xeo. Mazda is currently providing $1,000 cash on the 2006 Mazda6i and $1,500 cash on the 2006 Mazda6s. In November, Hyundai is providing $1,000 customer cash or 4.0% financing for up to 4 years and 4.25% for 5 years or a special lease program on the 2006 Sonata.

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xeo · November 2005

Car_man,

Doesn't Hyundai offer $1000 cash back plus $1000 if financing through them (can be substituted with low APR)? Thats the impression I get from the Hyundai website anyway..

Thanks.

nicole5 · November 2005

I'm new to the boards, so I apologize if this subject has been covered already. I currently trying to purchase a car, using my father-in-law's GM employee discount. Is it correct for the dealer to calculate the sales tax on the list price of the car, and not on the price including the discount?

qbrozen · November 2005

It MAY vary by state, but I don't see how this could be the case. I mean, when something is on sale at the electronics store, you don't pay sales tax on the original MSRP, right? So I don't see why this would be any different on your car. I KNOW this is no the case in my state. You pay tax on the purchase price.

dino001 · November 2005

As I was once explained, in Florida the tax is calculated on the agreed transaction price (minus trade, if applicable), but before "cashback" offers that work like coupons at register in your supermarket ($1.00 off those paper towels means store price+tax-$1.00). Thus, here, the order of calculations would be: listed GM employee price (significanlty less than MSRP, but not including latest cash-back offers) - trade + tax - cashback.

I think (but not sure) some manufacturers allow to "assign" the cashback to a dealer. Than it would be different, since the dealer collects your rebate, thus he/she can lower the transaction price accordingly, i.e. sales tax would be lower. I think GM does not give that option, but I may be wrong.

fordfool · November 2005

> I'm currently trying to purchase a car, using my father-in-law's GM employee
> discount. Is it correct for the dealer to calculate the sales tax on the list price
> of the car, and not on the price including the discount?

Sales tax is NOT paid on an employee discount. Sales tax is paid on the
difference between the price of the car you are buying and the car you are
trading in most states. However sales tax is paid on manufacturer's rebates,
but that is not the same thing as an employee discount.

Price you agree to pay minus trade allowance. Compute and add sales tax
and add tag and title fees. That's it.

Ford Fool

trojan2000 · November 2005

Hello. Does anyone know if there is a manufacturer's rebate for the Nissan Xterra SE 2005 and/or 2006 for November? Looking at the Price Paid forums, it looks like in the past there were rebates of $1000 to $1500. I can't tell from the Nissan website if there is one for November.

thanks

qbrozen · November 2005

i don't see anything for '06, but here is the link to '05 info here on edmunds.
http://www.edmunds.com/new/2005/nissan/xterra/100515797/incentives.html

maril · November 2005

I am trying to buy an 05 trailblazer EXT-LT. I ran it on Edmunds and it is showing TMV of $31355 - $8000 in incentives and rebates. However when I checked the incentives and rebates, Edmunds only shows $1000 and $3500. Where are they coming up with the $8000? I really need to know. I just talked to a dealership and when I gave him my offer which was $23500 ($31355-$8000)he brushed me off and told me that those kind of incentives just aren't out there. He offered $26350. Am I really that foolish or is there something that I don't understand with the incentives?
Thank you

kyfdx · November 2005

TMV already includes dealer incentives.. Cash that the manufacturer pays to the dealer... It does not include customer rebates...

regards,
kyfdx
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Rebates, Incentives, APRs - Questions & Comments

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