0% in Jan 2011?

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I'm not in any way connected to Toyota so my 2c isn't worth that much. Look on the dealer lots. Do you see inventory moving? When the weather is crappy how many people buy cars? Unless gas is going to really spike very quickly I don't see the auto market improving over the winter. I believe promo rates will continue, even at 0%.

 

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Cars.com is still showing over 18K 2010s, and almost 150 2011s. The numbers of 2010s are slowly decreasing, the 2011s growing.

So despite salespeople telling me no, no, no... this is as good as it gets, I'm betting sweeter deals are in the offing.

 

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Eh? Used? Au contraire... there are over 18,000 new 2010s on cars.com.

 

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Being that there are no incentives for those financing on 2011 models, the 2010 models are going to start moving far faster now.

I just calculated a lease on a III and a IV for someone comparing the 2010 to the 2011 and at current standard tier 1+ rates, the 2010 was almost $100 a month cheaper than a 2011. It dropped my jaw!

The one thing that no one, even me, had figured into the equation was the fact that the 2011 residuals are only $150 - 200 higher than a 2010 counterpart. And, the cars went up in MSRP about $400 on average (invoices too) MSRP with packages and base pricing differences.

We (in SoCal) have 0 apr for 36 months and 0.9 for longer terms... and that seems to be moving the cars out pretty fast as it is for this time of year. It could go both ways. Once the "best stuff" is gone to the early grabbers who don't want to end up with colors and packages they prefer not to have, the pickings will be left. The question is, what will Toyota feel about what's left and how badly they want to see it moved out? Once the cars are allocated and they are OUR cars at the dealership, they really are no longer Toyota's problem. They are mine, ours. They only become a problem if on the next allocation we refuse the next 2011 Prius we're allocated. Once 2011 product is refused, they will feel INSPIRED to offer an aggressive rate to keep the flow going. But, that said... we also have very low rates right now. You can't increase the residuals. The die's been cast. The rates are so low that even going from 0.9 to 0 won't make someone buy, just like going to .00001 rate won't create more leases anymore. The difference of $7-10 a month isn't going to make many more deals. I believe that Toyota region & TFS feel they are in a good place with our current incentives, and won't change things after Jan 3. I mean, compare the car's true competition -- itself in a 2011 model! The best rate TFS offers on 2011 is 4.25% and best lease factor on 2011 is .00235 ... and the car is about $400 more at cost, but when you do not use TFS special rates, there's dealer cash that is also available. When you consider those issues, the 2010's going to sell out quick in our state.

By the way, you think only dealers wanna earn cars? Regions do too. The more LandCruisers I sell, the more they are willing to send us and that is premium merchandise! The more Prius and HLH and TCh I sell, the more we get -- and the more we advance ourselves and the region on the food chain when the other plug ins and Electric Rav start to arrive. The entire region has a lot at stake here for their future.

That said, the offer of 0% across the board bears a problem... because that's a difficult place to come back from, especially on a mirror model - meaning the 2011 = the 2010 in all respects.

Just a few thoughts.

Dianne

 

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Ms. Whitmire: If you don't mind my asking, what percentage of your sales are, well... sales vs. the percentage that are leases? Thanks.

 

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I don't mind you asking at all!

Clarifying: My own Prius sales or my sales overall?

 

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Most interested in Prius, and recent trends, if any. 'Much Obliged.

 

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Recent trends: leasing.

My gut tells me it's because folks want manageable payments and terms they can handle IF they have a job surprise/downsize or drop in household income.
And, when the Electric RAV4 and the plug in Prius make their debuts late (as these cars always are planned for a certain time in rumors, but usually arrive late) ... these are cars which are the logical next step from Prius Gen II and III. That means if the market's saturated with Prius 2010 models, and the cars are worth residual, then they can walk away from them easily and not try and sell them in a crazy market. While I for one believe that those buying NOW are getting a low residual based on what's selling right now that's 3 years old and how much the 3 yr old models are going for, it's always a crapshoot. Who knows. Let gas creep back and and the phone's ringing off the hook again. Let gas drop back into the $2 range, and Prius interest slows. It's a delicate balance.

I feel strongly that lots of folks leasing now will have some equity in 3 years.

I sell other models too because it's hard right now to make a living on Prius. Everyone's whoring them out in this area deal-wise, including me (LOL) so other cars have to be a focus as well. I expect that to change pretty quick as the 2010's dwindle in SoCal because the 2011's are $100 more a month to lease than a 2010. They also don't have the 0.9% aprs. And, the residuals for the 2010 vs 2011 are virtually the same... within $150-200 of one another.

OK... I'll count it out for ya... and let you know. I know I have sold about 500 cars this year!

 

Wow! 500 cars! You've made a LOT of money for your dealership, and TOYOTA!

Actually, I was really just asking about the ratio of leases to sales... a lot of effort seems to go into pushing leases...

Regardless, thank you for all the info you provide, not to mention your insights on the new Prius Pickup!

 

I'd be interested to hear what you think I or we made on my sales.
I am the fleet director, ie wholesale department for new cars.

I am not retiring anytime soon... and it's not because I am raking it in and am greedy. It's because no one's making much per car these days.