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I think you guys are both right for your own points...

Let's take customer A -- on a fixed income that budgets $450 a month for a vehicle payment. If he goes to the dealership to lease a vehicle for the next 3 years and they can get him in the xc60 that he wants for $449 a month with proper mileage limits, etc - it doesn't really matter (to that buyer) if he's getting 1% under MSRP or 10% under MSRP. It doesn't matter if his MF is .001 or .00057. He hit his goal and he's going to be happy in that vehicle.

Customer B -- he doesn't really care if his payment if $400 or $550...but he wants to see how the actual numbers work out - he wants to see the biggest discount (and compare it with other buyers from sources on the internet) from MSRP, he wants to see the MF and then whatever the payment works out to be in the end, he'll be happy with. As long as he feels he's getting a fair deal, he's going to also leave happy.

I think a mix between the two is where most people do fall - I, personally, want to see a few numbers when talking about a car. I want to see MSRP, Invoice, Final selling price, APR (or MF and residual), any additional manufacturer-offered rebates, my trade value, and money down. I should be able to take those same numbers, do a little side math, and end up around the same place where they're putting the payments at. If something doesn't check out, then we need to go into more depth.

Neither method is necessarily wrong - certainly Customer B is going to be almost guaranteed to get the best deal that can be had, but Customer A is going to be happy as well...and if Customer A shops multiple brands or even multiple dealers of the same brand, he can bring any concerns to his chosen dealer and eventually he'll get a similar deal to Customer B anyway -- quite possibly right from the start, depending on the dealer.
 

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2020 V90 Inscription T6 (all options except upgrade stereo and rear wheel air suspension)
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DFrantz said "I generally think most people should factory order and get what they want and it makes comparison quotes easy as the units are identical." I agree. When I decided to purchase my 2020 V90 Inscription T6, I contacted 5 Volvo dealers via email. Gave them my factory order build sheet. Stated that it would not include a trade-in and that I was prepared to self-finance. Requested an "out-the-door" price, and defined this as the amount of money I would write on the check and drive the car off of the lot, adjusting for if/any manufacturer and/or dealer incentives at time of delivery. I also stated that I would expect their quote, if provided, to be a final offer.

I received 4 "out-the-door" dealer quotes and disqualified one of those. The disqualified one wasn't really "out-the-door", but merely an offer that could have been further negotiated. I compared the remaining 3 quotes and selected one for purchase.

I'm sure others, particularly those who have more purchase experience, may have done better. However, in my case, with less experience, at least I tried to conduct comparison pricing in a rational manner. At the end-of-the-day, the price one gets is what the dealer is willing to charge. Their final charge has a lot to do (at that point-in-time) with the economy, how in-demand the car is, potential manufacturer dealer sales volume paybacks, and many-many other factors of which I may have little knowledge or control of. Lastly, once one gets comparable quotes from several dealers, it's up to the buyer to decide which to choose, if any.

IMO, I feel a car is a just commodity, even though I'm a car-guy. A factory-ordered car is an IDENTICAL commodity that can be sold by many dealers. In my case, I felt that by comparing an identical car (commodity), under the same purchase terms, from several dealers, was my best chance for obtaining a reasonable purchase price.
 

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Let's take customer A -- on a fixed income that budgets $450 a month for a vehicle payment. If he goes to the dealership to lease a vehicle for the next 3 years and they can get him in the xc60 that he wants for $449 a month with proper mileage limits, etc - it doesn't really matter (to that buyer) if he's getting 1% under MSRP or 10% under MSRP. It doesn't matter if his MF is .001 or .00057. He hit his goal and he's going to be happy in that vehicle
There are still problems with this scenario. Your own statement says the customer isn't just shopping on monthly price, but also cares about proper mileage limits and the length of term. One issue is customers come in to a dealer and may be so focused on $450 a month that they don't realize the dealer switched them from a 36 month lease to 39 months. And it went from 15k miles to 10k miles. I've seen people purchase cars and be happy with their monthly payment until they realize they're on the hook for a 78 month loan!

Even if the dealer gives the customer their desired term and mileage, it's possible that the customer's monthly budget is high for the vehicle they're looking at. I'm not saying everyone needs to pull every penny of profit out of a deal for it to be a good deal, but I never think a customer should be ripped off. And when a customer honestly gives their budget in terms of monthly payment, they may be giving the dealer a tempting opportunity to rip them off.

There are many ways that an experienced dealer can alter the deal in their favor, to the detriment of the customer. That is why you can't ever just look at the monthly payment. You MUST always look at the "entire deal". So you can't just look at the monthly payment, but also the interest rate or money factor, length of term, fees, etc.
 

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We do have some of the best dealers in PNW btw.
I hope you are not referring to dealers in the greater seattle area? Two of the dealers nearest me are horrible. Both of them are owned by the same company-Swickard auto group. I hope you get the price you are looking for but good luck with the rest. When Volvo of seattle was independent, as it was for decades-it was great, but not now.
 

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There are still problems with this scenario. Your own statement says the customer isn't just shopping on monthly price, but also cares about proper mileage limits and the length of term.
No - the mileage limit is just as set in stone as the vehicle he wants. He wants a car for a set length of time with set mileage -- it's not some factor that the dealership can just change...and his budget is $450 a month. Period.

If you're shopping for a Volvo XC60 and they give you a price for an S60, you're probably going to walk out. Likewise, if you drive 11,000 miles a year, and they give your details on 7,500 miles a year, you're probably going to walk out. Don't argue just to argue.
 

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No - the mileage limit is just as set in stone as the vehicle he wants. He wants a car for a set length of time with set mileage -- it's not some factor that the dealership can just change...and his budget is $450 a month. Period.

If you're shopping for a Volvo XC60 and they give you a price for an S60, you're probably going to walk out. Likewise, if you drive 11,000 miles a year, and they give your details on 7,500 miles a year, you're probably going to walk out. Don't argue just to argue.
I'm not arguing just to argue. It actually happens every day! Go to Reddit and look at the car sales or personal finance subreddits and you will find a never-ending stream of threads where people went in for A and left with terms B.

Also, when you say "just look at monthly payment" you're really saying you can ignore the rest. If you say your position is you must be firm on ALL terms, then you're NOT just looking at monthly payment.
 

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Looking at just monthly payment is an easy way to give the salesperson a nice bonus vacation.

We all need to be educated consumers and understand what discounts you are getting (dealer discount off MSRP, mfg rebates, etc.) along with any and all fees.

Not doing so is just irresponsible.
 

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2020 V90 Inscription T6 (all options except upgrade stereo and rear wheel air suspension)
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Looking at just monthly payment is an easy way to give the salesperson a nice bonus vacation.

We all need to be educated consumers and understand what discounts you are getting (dealer discount off MSRP, mfg rebates, etc.) along with any and all fees.

Not doing so is just irresponsible.
I totally agree with your comment about being an "educated consumer". However, IMO, the average buyer does not have the inclination to determine all of the potential discounts that could reduce their purchase cost. This is not to say that they should or have to remain at the mercy of dealers pushing bad deals.

IMO, buyers should treat their potential car purchase as a common commodity and obtain out-the-door pricing from several dealerships (ideally, 3 or more). Instead of a person negotiating with one dealer, have several dealers compete with each other for one's business. In addition, buyers should rely on the internet and email for communication, instead of being subjected to potential in-person persuasive sales practices. I am not a professional negotiator, nor do I wish to devote the time and energy to this. However, the dealerships are professional negotiators, and they do this every day. To think the average car buyer can beat these people at their own game, IMO, is unlikely to often happen. While, IMO, a relatively few can hold their own with a dealership and a seasoned salesperson, the majority of car buyers are not/will be as skilled. However, by comparison shopping, this can improve the buyers chances of obtaining a reasonable purchase price.

Will price shopping with several dealerships generate the best end-price for a car? Probably not. My guess is a seasoned and educated negotiator could/would be able to obtain additional discounts. However, by comparison shopping with several dealers, IMO, at least the buyer can obtain a far better price than just going to one dealer and being led, like a lamb to slaughter, to agree to a higher than necessary price for their car.
 

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[QUOTE
Also, when you say "just look at monthly payment" you're really saying you can ignore the rest. If you say your position is you must be firm on ALL terms, then you're NOT just looking at monthly payment.
So I never said “just look at monthly payment”. I assume that if you go to lease an xc60 at 12,000 miles per year - you’ll leave with an xc60 at 12,000 miles per year, not an s60 at 7500 miles per year. Thought that was common sense.
 

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So I never said “just look at monthly payment”. I assume that if you go to lease an xc60 at 12,000 miles per year - you’ll leave with an xc60 at 12,000 miles per year, not an s60 at 7500 miles per year. Thought that was common sense.
"Common sense" isn't as common as you think. LOTS of people go in wanting to purchase and end up with a lease. Lots of people go in wanting a lease and they drive 12-15k a year but the dealer puts them in a 10k lease.
 

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Discussion Starter #33
The car has been purchased from a dealership within 4 hrs of initial contact as they clearly understood that they were dealing with a no-BS customer. --Again, I know my stuff and these guys were also a volume BMW dealership which most BMW customers like myself know our lease details. They recognized that and made a great offer which we took.

I will share the details of the deal shortly.

Couple of lessons learned from this thread as to my surprise. Most Volvo shoppers are not apparently familiar with details of leasing as I saw many dealers try to take advantage of the situation.

1. If you are shopping for a monthly payment and know nothing about leasing - walk away. Seriously, this is how the housing crisis happened in 2008. A dealer will get you into a HORRIBLE deal but will meet your monthly requirements.

2. Shop for exactly what you want / need. We built a car, wanted to lease and that was our deal...... no other stories. If you walk into a dealership (which I hope you just don't do) without a goal, you will be taken advantage of. We bought EXACTLY the car in colors / options & etc we wanted ----Apples to apples comparison.

3. Apparently, Volvo offers no price / rate protection for a customer who wants to order a car from factory unlike other high-end brands. BMW will lock your rate until your car shows up and if the rates / incentives get better, they will honor the better deal. Volvo, NO CLUE! - Wonder why 80% of the BMWs are leases. Almost all Volvo sales folks were dumb founded when we said that we wanted to order a car.

4. Many dealerships offered great discounts but as the discounts got big so did the Money Factor on the lease and when I called them out on it they all disappeared.

At the end of the day, my in-laws got a 2021 XC-60 at over 10%+ discount, with base MF which is .00089 with zero additional fees. The dealership had the exact configuration in inventory minus a 20" wheel option which costs $1,000. Dealership agreed to deduct the wheel option on top of the discount provided to make the deal work. They did not need to do this and my hat is off to them!

For those of you only shopping for the payment here is an example:

We got quotes for the same identical car for same identical lease term, same identical down payment (which is just the incidentals) with same identical conditions varying from $510 a month all the way to $780 a month! ----Guess what deal we ended up taking?????

Peace, I wish there were more price discussions on this board.

 

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To further the price discussion please post the details of your deal.

MSRP
Sale price
Discounts
Term
Miles
Residual
MF
Cap Reduction
Drive off
Monthly payment - pre-tax
 

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Most Volvo shoppers are not apparently familiar with details of leasing as I saw many dealers try to take advantage of the situation.

3. Apparently, Volvo offers no price / rate protection for a customer who wants to order a car from factory unlike other high-end brands. BMW will lock your rate until your car shows up and if the rates / incentives get better, they will honor the better deal. Volvo, NO CLUE! - Wonder why 80% of the BMWs are leases. Almost all Volvo sales folks were dumb founded when we said that we wanted to order a car.

4. Many dealerships offered great discounts but as the discounts got big so did the Money Factor on the lease and when I called them out on it they all disappeared.
Volvo leases a tremendous amount of cars, and since Volvo has a large % of repeat buyers the generalization the Volvo customers are not familiar with leasing seems peculiar to me. I don't think a dealer would agree with your assessment.

Volvo custom orders are indeed price protected, just like BMW. I know this is a fact because my custom order in October was indeed price protected for December delivery. Perhaps all the particular specifics on the definition of "price protect" varies a little between brands, but a ordered lease Volvo is guaranteed that the lease offer at time of order is a "worst price scenario" and is locked in, but allows your deal to get better if the offers are better at time of delivery.

The amount of money dealers make on an increased MF is minimal and it's extremely uncommon to sell cars at inflated MF rates. A large discount only has a meager increase in profit from an increased money factor, so the reality is a little different than you imply. A dealer determine how much they want to discount the car just like they decide if they want to earn an interest profit on the MF. "Calling them out" seems a weird way to refer to their pricing structure, as if they are some how being shady (which of course they are not). You act as if knowing the MF is a secret when it is not.

Congratulations on getting the deal you wanted. Your experience described her is interesting, as it certainly doesn't represent the way many of us buy a car. Your definition of a "good deal" and how payment shopping is not relevant is certainly your opinion, as many of us look at it very differently. Many of us enjoy buying a car and like working with our dealer, which is in contrast to how you approach trying to scorch the dealership baddies over a few hundred dollars. I guess that's why certain dealerships do business in very different ways - some accommodate your buying strategy while others do not.
 

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Discussion Starter #36
To further the price discussion please post the details of your deal.

MSRP
Sale price
Discounts
Term
Miles
Residual
MF
Cap Reduction
Drive off
Monthly payment - pre-tax

Pricesly what I wanted to document in this thread!

MSRP: $49,490
Sale price: $44,490
Discounts / Rebates: $1500
Final Selling price after discounts & rebates: $42,990
Term: 36 months
Miles: 15K per year
Residual: 55%
MF: .00089
Drive off: 1st month + reg & licensing: $1646
Monthly payment - pre-tax: $502 + tax

To counter above statement about dealers making few hunters dollars on MF. If the money factor was .00189 (as we have been offered several times), payments would of been $570 a month and that is a total of: $2520 during the term of the lease.

Overall, this was quick process and what I have shared with you is the experience and feedback from the 15+ (I think) dealerships that I have reached out to. We will be purchasing 2 additional Volvos from this dealership as I was very impressed with their overall service.

Hope this is helpful for some.
 

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To counter above statement about dealers making few hunters dollars on MF. If the money factor was .00189 (as we have been offered several times), payments would of been $570 a month and that is a total of: $2520 during the term of the lease.
.....and the dealer discounted the car selling price $2,520 additional dollars so the MF increase is a wash in the end and the payment is the same. That's my entire point, just saying a dealer outrageously increased the MF doesn't automatically make the deal "bad". Some people love to see a huge % of discount, and that can be shown numerous ways (including the MF). Of course some markets have different MF in the first place, hence why calling all over yields different results. Just pointing out how in the end the payment IS the only thing that matters....how you get there makes no real different. The total of your monthly payments DOES indicate the "deal" you get, and payment shopping is totally valid if you compare equal variables.
 

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.....and the dealer discounted the car selling price $2,520 additional dollars so the MF increase is a wash in the end and the payment is the same. That's my entire point, just saying a dealer outrageously increased the MF doesn't automatically make the deal "bad". Some people love to see a huge % of discount, and that can be shown numerous ways (including the MF). Of course some markets have different MF in the first place, hence why calling all over yields different results. Just pointing out how in the end the payment IS the only thing that matters....how you get there makes no real different. The total of your monthly payments DOES indicate the "deal" you get, and payment shopping is totally valid if you compare equal variables.
Payment shopping only works out for the consumer when they understand all the different variables of the deal. Blindly payment shopping without knowing how the dealer got there or if it is a fair payment for the specific vehicle is an easy way for the dealer to make a ton of money on you.

Is base MF always a requirement for a good deal? No. A MF bump in lieu of a bigger discount can favor both the dealer and the consumer, but the key is that the consumer needs to understand why its OK to accept a bump in MF. A dealer wont mark up the MF and automatically give a bigger discount. Why? Because they are in the business of making money. Especially if they sense that the consumer is at a loss of how things work, they are going to try and make as much money off of them as possible.
 

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Especially if they sense that the consumer is at a loss of how things work, they are going to try and make as much money off of them as possible.
That's assuming the dealer is shady.....which many are not. Many dealers simply look for fair deals, not how to rip of buyers. That's just an old stereotype that died a long time ago with reputable dealers. I bet most people would be surprised than dealerships overwhelming loose money selling new cars if you look at their annual financials. It's pretty normal to not even make $2,000/new car, and usually fixed expenses exceed the profit on the new cars sold. It always seems so many people approach dealer sales and money-hungry, greedy bad people. That really is disheartening to me, but shows how little the average person understands the industry.
 

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Discussion Starter #40
Payment shopping only works out for the consumer when they understand all the different variables of the deal. Blindly payment shopping without knowing how the dealer got there or if it is a fair payment for the specific vehicle is an easy way for the dealer to make a ton of money on you.

Is base MF always a requirement for a good deal? No. A MF bump in lieu of a bigger discount can favor both the dealer and the consumer, but the key is that the consumer needs to understand why its OK to accept a bump in MF. A dealer wont mark up the MF and automatically give a bigger discount. Why? Because they are in the business of making money. Especially if they sense that the consumer is at a loss of how things work, they are going to try and make as much money off of them as possible.
I couldn't of said it better myself.
 
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