Will dealers be allowed to gouge us?

[adric22]

One thing I worry about is going to the dealer to pickup my Leaf and they decide to add a $5,000 market adjustment fee to it because of high demand and short supply. If this happens, I won't be able to buy one despite the fact I plopped down $99 for my reservation.

[garygid]

I think all early deliveries will have their pricing arranged on-line, directly with Nissan. Or, at least the dealers will be tightly Nissan-controlled.

Later on (maybe mid 2011), who knows?

[Randy]

I did a Nissan chat on this topic recently and they were quick to tell me that the dealers set prices, and that it is against Federal law for Nissan to sell cars directly to consumers. Here is a paste of the relevant text from the chat.

Randy:
My concern is the phrase you have on your website that says "Dealer sets price". At MSRP, I would have to come up with $36K or $37K to buy the car before the incentives are paid out, I am concerned about the dealer's pricing. In the past, dealers are notorious for adding anywhere from $2K to $5K to a desirable car because they are usually in short supply. If the Nissan dealer does that on the Leaf, it's a showstopper for me. I would much prefer to pay through the Nissan website and just pick up the car at the dealer and lock it in at MSRP, but it doesn't look like that will be happening. Do you think the dealers will be asking MSRP or will they try to raise the price?

Tim:
Federal law prohibits major automobile manufacturers from entering into sales transactions with individuals. Please let me research this further for you, Randy.

Tim:
Thank you for your patience. While Nissan cannot price the transactions that take place between the consumer and the dealer, they will work with both parties to help them arrive at a fair price. The Nissan Leaf will also be available for lease. For the lease, Nissan will roll the benefit of the tax credit into the monthly payment. The Nissan LEAF will be available via 3-year lease, for a payment starting at $349/mo with $1,999 as a down payment for the qualified customer.

[garygid]

Suddenly, coming up with $2000 instead of almost $40,000 seems like something to consider seriously.

With the Lease, is there no sales tax or license fees, since the "customer" does not own the car?

Does the lease include the charging station?
Or, is that still another $2200 or so?
How much is a second charger, if the first dies or for a second (2nd home or work) location?

Can one get out of the 36-month lease if unable to continue the payments? How?

Who pays for maintaining and repairs?

Is "different" insurance necessary for a leased car (and, is considered a rental)?

Thanks, Gary

[daniel]

My understanding (and I'm pretty sure about this) is that you will negotiate a price with the dealer at the time you place your order. It is your responsibility to make sure you have all important details in writing. Some dealers may want to charge more than MSRP, and some buyers may be willing to pay. My local dealer has told me categorically that he will charge MSRP and will not add on any other charges (other than, I presume, the "document fee" which is on every car purchase.)

As with any car purchase, you should get it in writing that there will be no dealer add-ons that you have not agreed to. As long as there are enough dealers that there is competition, my guess is that there will be other dealers like mine who will deal fairly with you. I doubt you'll be able to negotiate a lower price than MSRP until the cars are sitting unsold on dealer lots. Won't it be nice when there are so many electric cars that you can just walk in, say "I want that one" and drive it away! But that day is a few years off still.

[Randy]

Hi Gary,
I think there is tax and license rolled on top of the $349 lease price. The Nissan website does have that disclaimer that the $349 price doesn't include those fees. However, by leasing you do get the fed tax credit immediately, so that is a plus. And I hear you about putting down almost $40K instead of the $2K for the lease. I'm going to explore both options and see what the price will be both ways. And also what the residual price would be after the lease if I wanted to buy the car.

When I was reserving, they did say that the SL version lease would be $379...I guess we'll figure out a way to get it one way or another.

[garygid]

Many lease agreements have a mileage "limit", and one gets charged extra for over-limit miles at the lease end.

Will the Leaf lease have a limit?

What will the "buyout" price be at the end-of-lease?

Is that extra-miles charge (if any) deducted from the offered buyout price?

Thanks, Gary

[garygid]

$379 - $349 = $30 x 36 = $1080, just a bit over the $1000 up-front extra charge for the SL.

The SVs might be scarce.

The $349 x 36 is around $13,000.

I would like to understand the whole lease process.

[AndyH]

Car Leasing FAQ

Webster's Dictionary defines a lease as "a contract by which one conveys real estate, equipment, or facilities for a specified term and for a specified rent." In other words, a car lease is a fancy way of saying you will be renting a car. But not like the typical car rental. With a car lease you are paying monthly installments, which will reflect an interest rate as well as the depreciation of the value of the car you are leasing.

While most people think they are leasing from a car dealership, in reality you are leasing it from a leasing company. The dealership sells the car to the leasing company, who then lease it to the consumer under the terms agreed upon between the consumer and the dealer. These terms include the capitalized cost, the monthly payments, the length of the lease and the interest rate.

Start here for an excellent overview of what a lease is, the two types, the process, scams, and negotiating tips.

Keep in mind overall that a dealership is an individual company and is in business to make money. The first rule of sales is 'ask for it' - if they ask for an extra $10,000 and you give it to them, then it's not the dealer's fault.

Andy

[mitch672]

There was a "chat" of sorts on Twitter #carchat last week, I asked multiple times about the Lease mileage limit, and what the residual would be at the end of the 36 month lease. My questions where ignored. I don't think they know yet, or they don't want to release that information yet.

I do think that if the lease residual + the initial $1999 payment and either the $349 or $379 / month payment (depending upon model you choose), doesn't have too much of a premium over outright paying cash, it is a better way to go, as you do get the $7500 Federal credit, without having to qualify for it as a Federal tax credit on your next years taxes (some people may not be eligable for several reasons), and, it puts the onus on Nissan to prove the battery pack life is good, and the car is trouble free, at least for the first 36 months, if it isn't, they will be taking a lot of Leafs back in 36 months..

Also of course it's better for your cash flow, you don't need to put out the money all at once / upfront.

If the car is fantastic, you can always buy the lease out at the end of the 36 month term, unless they try to pull an EV1, and I doubt that will happen (this time around)