Does Below Invoice Pricing Work on Leases As Well?

[Bradley]

My girlfriend is looking into getting a Jeep in the next few months. The car will be paid for by her company and she would like to lease it. I have been following these forums for some time to know that there are good deals out there from various dealerships when it comes to buying. However, I am not sure how this relates to leasing a vehicle. For instance, if a dealership is offering 5% below invoice does that only apply for purchasing the Jeep or can I lease it as well?

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[RussJeep1]

While I'm sure that lease prices and terms are not static across dealers, do consider that one of the big pluses to a dealer (and FCA) of selling you the Wrangler (over leasing it to you) is the money they make in service that you pay for as the vehicle's owner, rather than as lessee: often a far greater component of dealer profitability these days than sales.

 

[ThirtyOne]

I know koons will lease on the group buy but they won't give you lease terms until the vehicle ships.

 

[TPFilm1994]

While I'm sure that lease prices and terms are not static across dealers, do consider that one of the big pluses to a dealer (and FCA) of selling you the Wrangler (over leasing it to you) is the money they make in service that you pay for as the vehicle's owner, rather than as lessee: often a far greater component of dealer profitability these days than sales.

Why? You still need to have the Jeep services, wether you buy it lease it. The dealership gets the same money wether you buy or lease. In a lease, the leasing company “buys” the vehicle from the dealer and you pay the leasing comoany a rental fee - your monthly payment. Dealer gets paid and moves onto the next deal. 3-6 months later you roll into service with your leased vehicle, dealer makes money.

 

[RussJeep1]

I can't speak to Wrangler specifics, but with other lease deals, (as it is the lessor who owns it, it (too) is the lessor who picks up its service, having vested interest in protecting their asset for future sale or lease once the initial lease is up.

To the extent that lessor and dealer/manufacturer have a fiduciary relationship, the dealer may be paying for service on their own vehicle in not being compensated by a third party for its scheduled maintenance.

 

[TPFilm1994]

Every vehicle I’ve ever leased (at least 6 since 1994) I’ve been responsible for maintenance. It’s even been written in the agreement. This was for Hyundais, Chevrolet’s, Saturns and my first two Wranglers. Maybe the Mercedes and BMWs get the special treatment. Still, the dealership NEVER holds the lease ownership. It’s always either a bank or the brand’s financing arm (GMAC, Chrysler Financial, etc.) After the paperwork is filed, the dealer gets paid and moves on. Now, some dealers offer maintenance for a period of time on all vehicles they sell. They may or not be reimbursed for that. Of course, they use those plans to push other, more expensive “services” that aren’t necessary and are pure profit - tune ups in modern vehicles at 30k miles, fuel injector cleaning, etc.
If you’ve had lease deals with full maintenance included then more power to you. But, I’ll bet you still paid for it... buried deep in the agreement.

 

[RussJeep1]

But, I’ll bet you still paid for it... buried deep in the agreement.

I must agree: solid point TPFilm1994.

 

[nel1551]

My girlfriend is looking into getting a Jeep in the next few months. The car will be paid for by her company and she would like to lease it. I have been following these forums for some time to know that there are good deals out there from various dealerships when it comes to buying. However, I am not sure how this relates to leasing a vehicle. For instance, if a dealership is offering 5% below invoice does that only apply for purchasing the Jeep or can I lease it as well?

It's the same deals. Dealerships just sell the cars. Lease is still a purchase from them, just is different since you are paying for use to the bank instead of making the purchase to the bank. You can always buy out your lease though.

 

[Karl_in_Chicago]

I can't speak to Wrangler specifics, but with other lease deals, (as it is the lessor who owns it, it (too) is the lessor who picks up its service, having vested interest in protecting their asset for future sale or lease once the initial lease is up.

To the extent that lessor and dealer/manufacturer have a fiduciary relationship, the dealer may be paying for service on their own vehicle in not being compensated by a third party for its scheduled maintenance.

The dealer doesn't pay for anything on a leased vehicle that they wouldn't pay for a sold vehicle - meaning pretty much nothing. A lease is still a sale. There's really basically 3 ways a vehicle is purchased but to the dealer they are almost the same, other than what potential benefits the dealer might realize based upon how the vehicles are paid for. Case 1 is the buyer pays cash, dealer gets nothing more than purchase price. Case 2 is buyer purchases vehicle but finances it; if buyer finances it through a dealer-affiliated finance program dealer may get a taste of the additional costs. Case 3 is buyer leases vehicle; most leases are overwhelmingly (though not exclusively) done through dealer-affiliated finance program and dealer typically gets a taste of costs. In all 3 above cases, though, it is the buyer who is responsible for all service costs (absent some negotiated service deal) and the buyer may or may not choose to have said service performed at that dealer.

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