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Originally Posted by bfiipursuit
Pfft now your changing direction... I have spoken of bonuses and holdback in some of my other posts, I do have a fair understanding of the industry in particular to how floor plans work and manufacture incentive schemes, thats why I have pulled you up.
You are suggesting that FPV can help people potentially buy their car, thru giving them discounted finance rates etc. The truth is however they aren't helping the consumer at all, all they are doing is robbing Paul to pay Peter through charging retail prices for the goods and giving the customer a cheap interest rate which covers the difference of 4% of interest typically. What's that acheiving?? Nothing, the customer still ends up paying the same (or potentially more) monthy payment, but because the interest rate is 2.9% it must be a great deal!
For example if i do a lease quote on a G6ET for 60 kay at 4 % and one at 8% the difference is roughly $6400 in interest over the 5 years... So instead of paying paying $52,000 for the G6ET with bonuses and incentives you pay $60,000 costing you an extra $8000 for the car, saving $6400 roughly in interest.. What the better deal?
The part that makes me scratch my head is that you suggest buying another Nissan will benefit your cash flow thru no repayments till 2012 but you made no comment of the 20% upfront, how does that help your cash flow?? Id rather pay 12 monthly installments rather then 20% upfront just so I could live repayment free for a year, thats the whole idea of cash flow.
While your theories are good nothing is free, I think thats the biggest issue I perceive with most of these marketing tools you speak of, because thats all they are, they aren't good value for the customer. Toyota and Lexus are the kings of it, and its usually on old plate / runout cars that they can't shift or cars they want to sell at retail.
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So the trade in of my current datto would not be more than $16k? It is not a FPV, it actually HAS fairly good resale value......
And as a PAYE employee I am very sure you would prefer monthly payments as your cash flow is assured and you get the same money on the same day every week regardless of what happens.
Are you seriously saying that even though you are employed in the finance industry you don't understand how, in the middle of this current recession when debtor accounts are extending further and further, deferring operating costs can assist in maintaining viability?
Seriously?
And you don't seem even remotely understand cash flow.
The difference between $1000 per month for 5 years ($60k) as opposed to $1500 per month for 36 months ($54k) is that if you can't afford $1500 per month and refuse to pay $60k THEN YOU CAN'T BUY THE VEHICLE.
Now, if because you have the vehicle you can earn an extra $200 per month then you will have earned over the 5 years an extra $12k and will be actually $6k better off rather than worse off.