How much wiggle room does a BMW dealer have on new cars?

Rick Lee · Rick Lee's Garage

Mrs. Lee is pretty set on a new X1 and wants to know how good a deal she can wring out of the dealer. Their ads say $249/mo for 3 yr/30k mile lease, but their computer is coming back with $408/mo. and that's with all taxes and fees paid upfront! How should she bargain?

speeder · speeder's Garage

Show them the ad and ask WTF?

Maybe the ad is for a stripped model or only one unit? IDK.

Rick Lee · Rick Lee's Garage

I'm sure the $249/mo figure is for the most bare bones version. She added a premium package for $3900. But that can't possibly raise the monthly by over $150, can it?

speeder · speeder's Garage

It can if the low lease rate wa a special offer only on the stripped car to get people like you in the door who want a nicer one for the regular price. Works like a charm, who wants s stripped BMW?

mattC2993 · 04-12-2015, 09:13 AM

Their online price should be a close starting point. I would negotiate on the vehicle cost and not the payment. They will use your cash to buy down the lease rate. Its all a game. I've had 3 BMWs (not a fan anymore). Of course options and lease terms will make a big difference in the payment. Usually BMW bases their advertised lease rates on a significant down payment i.e. $6k. It should be in the fine print.

David McLaughlin · David McLaughlin's Garage

When I was selling cars, my easiest customers/ lowest commissions came from people walking in the door with print outs from Edmunds.com. They listed the MSRP, invoice, holdback, and all programs available for their given model. Maybe by now there are others sites like that but it's a start.

Steve Carlton · 04-12-2015, 07:20 PM

The ad deal is probably a "loss leader." They might be losing money on it to bring people in the door- think of it as an advertising expense. On a different car, you need to get educated on what the best kind of deal will look like. Does that dealer have the exact car your wife wants? How big of a rush are you to close this?

Vipergrün · 04-12-2015, 07:28 PM

Unfortunately, yes...that package can and will drive up the cost. 3900/36 + tax is roughly 120.00. Have her find the car she wants, visit truecar.com. Take THAT price and lease with it. The discount should cover a decent chunk of the cap cost reduction and lower the payment. Also, 10K miles/year is low, and its probably .25 per mile after that. You can typically add additional miles up front for .10, but this also changes the residual value as it accellerates depreciation.

Steve Carlton · 04-12-2015, 07:32 PM

Not on a lease. The higher MSRP of the Premium pkg car will shift a lot of the cost to the residual. And the Premium pkg car may have a different (likely higher residual percentage), too. Rate factors can vary. There's a lot of factors here. And a TrueCar price might not be the best. Check Costco also, if you belong, and with a few dealers. Find out what the "buy rate" is on the lease and negotiate based on a lease at the buy rate.

nota · 04-12-2015, 07:51 PM

are there still vary different rates on the base car
and the factory options pay the dealer more ?

can you buy a striped BMW no air no radio ect ?

Rick Lee · Rick Lee's Garage

Change of plans. While I was at band practice today, she escaped and went car shopping alone. This is what she found.

Find Pre-Owned 2014 BMW X1 in Peoria for Sale

Salesguy discounted it before she even started to beat him up. I think she's going back tomorrow to work on a trade deal.

sammyg2 · 04-13-2015, 05:46 AM

Truecar.com

I've used it, it works.

Steve Carlton · 04-13-2015, 05:58 AM

It's good, but it doesn't necessarily give you the bottom of the market in actual quotes. And it's not designed to deal with lease quotes. A lot of dealers will mark up the rate a bunch with a low selling price because a lot of customers don't realize the lease rate can be marked up and base their decision on just the selling price.

stomachmonkey · 04-13-2015, 06:09 AM

Quote:

Originally Posted by Rick Lee

Change of plans. While I was at band practice today, she escaped and went car shopping alone. This is what she found.

Find Pre-Owned 2014 BMW X1 in Peoria for Sale

Salesguy discounted it before she even started to beat him up. I think she's going back tomorrow to work on a trade deal.

Nice find.

I always look for a depreciated car.

Being first owner just does not seem worth it to me.

Rusty914s · 04-13-2015, 06:12 AM

Negotiate payments on a lease car, not price. Negotiate price on a purchase, not payments. Never buy down the lease rate, you should pay title and first payment and that's all on a lease.

My understanding is that there is somewhere around an 8% mark up, used to be 13%. Not sure if those numbers are correct.

Rusty914s · 04-13-2015, 06:19 AM

BTW, I wanted to add, I've had both the sport and non-sport packaged X1s as loaners and you couldn't pay me to drive a non-sport X1 on a daily basis. I hated the suspension, it felt like there was a sheet of plywood between the chassis and the wheels. I would test drive both, YMMV.

Rick Lee · Rick Lee's Garage

She has also had X1s as loaners. I'm not in love with them and think the 320i sedan, which she test drove on Sat., is a better bang for the buck. But she insists she needs the ride height of an X1 vs. a sedan or coupe. The sales guy we dealt with on Sat. was so bad, I just don't want to go back there. As a sales person, myself, this guy just insulted all sales people and dicked around for a good 90 min. before trying to identify what Mrs. Lee's pain points and must-haves were. She said the MB guy yesterday was a real no-nonsense pro. I also hate the idea of buying new. But some of the CPO Bimmers are barely discounted, if at all, vs. new. She will always have to have a bumper-bumper warranty, since she only has one car and can't drive two of my vehicles.

mattC2993 · 04-13-2015, 09:53 AM

Usually you get much higher rates on used and last year's models too. It only makes sense (and barely) on cash sales.

Steve Carlton · 04-13-2015, 09:39 PM

So, she's looking at buying (vs leasing) a 2014 vs leasing a new one? What's the price and mileage of the used on vs the price of a comparable new one?

Rick Lee · Rick Lee's Garage

She ended up getting the silver X1 I linked to above. It was in perfect condition and they told her $25k before she even started bargaining, which was well below book.

One tactic they used, which I hadn't seen before and was unprepared to counter was to keep telling us their sales price was well below book, while justifying their trade lowball on recent auction prices rather than book. KBB and NADA had Mrs. Lee's E92 at around $13k for a clean trade. Dealer insisted they were bringing $10k at Mannheim and then showed us lower mile examples on AutoTrader for $12k. He further said they simply didn't want the car because they are a MB dealer, which I had to believe was true.

She was debating whether to pay cash or finance. To take the car home last night, she obviously had to go through their financing, which they put at 3.99%. Once in front of the F&I guy, we told him there was no way we'd be taking their financing at 3.99%. He asked us what we could get elsewhere, we said 2.49% and so he matched it right there. If we had done some more research, we might have been able to get even lower.