PhilH930

Hello. I've toyed with the idea of a G37 since their release, but found rates at the time to be non negotiable at my local dealers. Well time has passed and I stopped by two dealers this weekend, and one of them came back with a reasonable deal. Below is the car and pricing:

G37 Liquid Platinum 5AT
Premium Package
Sports Package
Illuminated door kicks
Cargo Net

MSRP: $41,625
Price: $38,400 (I got VPP pricing, which is as near as invoice)
Fees: $499
Capitalized Cost: $38,899

39 mths / 15k Miles

$495 + 6% tax = $525 p/m

They did not provide any detail into the MF and the residual is 63% (I believe this to be correct, this was not noted and my quote is handwritten. I also backed into this residual using a lease calculator netting to the payment above). The offer stands while I think it over.

I would have signed there and then, but there is one issue - my current car. I have negative equity on my Audi A4 due to high mileage and age. This puts me $4400 out of pocket, which adjusts the Cap Cost to $43,299, and the adjusted monthly payment to $655 including tax.

What do you guys think of this offer. My trade in is hurting me, but they are not using this to offset the price of the G37, as I've verified the Audi with KBB and Edmunds and they seem OK. I think they are hurting to shift cars and have high inventory. The above was based on no negotiation other than $1k more on my trade in, from $8k to $9k.

Thanks

dirtboy

I would not do a 39 month lease. 24 or 36 month only, 48 month maybe -- but only if the manufacturer's warranty covers 48 months. (I know Infiniti does, but I'm speaking generally here.)

PhilH930

Can you elaborate what the issues are with a 39 mth lease in your opinion?

dirtboy

On most brands you get a 36 mo warranty, so for the last 3 months, when most things are going to break, you are stuck with the repair bill.

You will pay registration at the 36th month for the entire coming year, but only use 1/4 of it before turning it in. That's a waste of money.

If you buy cars during certain times when there are more deals, like during model closeouts, the 39 month will push you out of your normal buying cycle.

If you do a 24 month lease and go fairly easy on the tires, you probably won't have to replace them. But on a 36 month and for sure on a 39 month lease, you'll turn the car in re-registered and with new tires.

In the end, the low payment will end up costing you.

Based on the rates, Infiniti has the best or one of the best 24 month residuals and money factors in the market. Other than a slightly lower payment, one is best to go with a 24 month lease IMHO.

LeonC626

Hey I got mine on 4/29th 39mons lease:OB journey with Navi, Sport, Premium, Kick plates, and cargo stuff. Drive off was $1500 and monthly is $525(including CA 8.25% tax) It's from Infiniti of Montclair in CA

Graham

Depending where you are located I know there are a couple members on this board that would probably be able to be that deal easily, majority of people I think are picking their cars up below VPP and some below invoice.

PhilH930

I am located in Atlanta so would be looking for a deal in that area.

They are valid points regarding the 39mth lease program. The out of warranty servicing/repairs and tires do mitigate the price of the lease, however in my case a 24 mth lease had a higher price and was not feasible considering the situation with my trade.

Typically, on the same car with a good structured deal, should a 24mth or 36mth program offer you a lower payment?

RIDEwithG

if you are looking to have the lowest payment, 39mo is the sweet spot.
I don't your residual is 63% tho. Specially considering that I'm getting 63% and I have the base model with 12k miles, which hold a higher residual than a Journey with 15k miles. I'm thinking more like 61%. Your $499 fee is what? Doc fee + DMV? You're probably getting your $595 bank fee rolled into your cap cost, which explains the $500+ monthly payment.
In all honesty, based on the model you picked, your payments should be around $450-$480 after taxes with the 1st month and all fees upfront (around 1300-1400 due at signing). this is just my ballpark guess. There are some profit for the dealer hiding somewhere.

The major downside I see with 39 mo payments is the registration. Some states allow you to transfer your places from one car to another tho, so you may be able to do that.

Warranty issue is moot since Infiniti offers 48mo/60k miles. 24mo leases may help you avoid tire costs or what not, but you payments are higher, so you're paying for it whether you like it or not.

dirtboy

No, but in the end a longer term lease will cost you more than the "low" monthly payment. My introduction to leasing was with a $299/mo Chrysler Crossfire that I got for $0 down, due to a trade. While the low payments were good, the 36 mo warranty ran out before my 39 mo lease did, and luckily I didn't have any thing more go wrong with the car -- but it had issues. However before I turned it in I spent a couple hundred on CA DMV fees and $1,200 to put new tires on the car; do keep in mind you have to put on equivalent rubber to what you purchase the car with. I doesn't have to be the same brand, but if you get sport tires with it, it must come back with sport tires on it. So in my case, I got screwed. While I payed very little for it, in the end it all caught up. I've since learned from that.

But if you want to compare some lease rates, I can give you some examples. Below is a G37S configured as I would buy it with a MSRP of $41,915. Assuming you paid MSRP, and I realize nobody will, here's how the lease rates will look, assuming 15k miles/year and the best MF rate:

G37S
MSRP $41,915
Price paid: $41,915 (assume any additional costs paid out of pocket)

24 mo: $604.97 + state taxes
36 mo: $583.65 + state taxes
39 mo: $547.37 + state taxes
48 mo: $552.30 + state taxes

If you are getting VPP or near invoice, clearly these numbers are high. However it does illustrate a point...

The difference between a 24 mo lease and a 39 mo lease is $57.60/mo. Over the course of 24 months that is $1,382.40.

CA DMV fees let's say at $300/yr.
New OEM tires for the G37S (from tire rack): $1,010 (not incl tax, ship or install)

You can see why I believe it is cheaper to do a shorter lease, providing the tires will hold up for 24 mo, than to go with a longer lease. In the end, you will pay for the lower price. If you tell me you can't afford a 24 mo lease, how will you afford to put tires on it and pay the DMV fees 36 months from now?

I've gotten to the point where I won't consider any vehicle beyond 24 mo lease. To me it's the ideal situation for the consumer and minimizes potentially large out of pocket expenses just prior to lease turn in.

RIDEwithG

I sense a flaw in your logic.
For example. let us assume that your 24 mo drive-off is 1st mo payment, dmv and ALL fees. Which we will assume to be $1500. Lets also assume that for a 39 mo lease, the drive-off is the same.
Now lets assuming your monthly payments are what you describe to be, $605 for 24mo and $548 for 39mo.

At the end of 24mo, you will pay $1500 drive-off + $13915 in payments.
For a total of $15415. But wait a sec! The comparison can't stop there because a 39mo lease is 15mos longer. What will you do? You either ride the bus OR you lease another car. Lets say you lease the same car, same payments same drive-off. Thats another $1500 and $605 per month for the next 14 months. Thats a grand total of $25,385 in 39mo. Leasing TWO cars.

In contrast, on a 39mo lease, you spend $22324 (with drive-off and rest of payments). Even if you drop $1200 on new tires and another $300 on DMV, that still about a $1500 difference.

dirtboy

There's a flaw in your logic is well, because you have misstated the cost of drive-off in attempt to validate the benefit for longer leases. I will try to address it when I have time.

RIDEwithG

LOL. Maybe I shouldn't work with your numbers. I'll try to whip up some of my own later. :P

PhilH930

Well thank you all for the above feedback, its some good information. I visited another dealer today and got similar pricing to what I quoted earlier, but this time it was on a slightly different model, one which I desire more. I vehicle is a G37 6MT with Prem, Illuminated Kick plates, Spoiler, Splash Guards, Cargo Net and Graphite Interior and Liquid Plat Exterior. This is pretty much the car I would like and they offered me VPP pricing which brought the selling price to $38,250. Researching online through KBB and Edmunds, this appears about $500 over invoice. However if I bring this to invoice, it removes additional negotiation power I have on my upside down trade in. Before the trade in, with 15k miles per year over 39mths, the above car was coming to about $530 per month including tax.

I don't know what to do! They let me see all details behind their leasing software, and there were no ridiculous hidden charges. The only point of interest was the rate, which originally they entered 2.8 before bringing it down to 2.1, saying they can't go any lower than this through IFS.

This has $0 down with all thats due at signing first months payment and $40 tag fee.

To that point, I know it varies by state, but how much does the G37 run for tag renewal on when leased?

RIDEwithG

Nooooo. :P Your trade-in should be negotiated separately. I was in the same situation and I still got near invoice ($37.14 over invoice) and was able to get an extra few hundred dollars on my trade-in.

Don't give up!

humble226

Well, there are advantages and disadvantages. Minimizing maintenance costs is certainly a huge benefit, especially if you can avoid more expensive things like the 30k mile maint. You can also pretty much safely assume that no matter how cool the technology on your car is today, in a couple of years there will be something which is that much cooler available, and maybe even for less money. This is why I personally prefer a ~24 month cycle on my cars, since the cool new toys I'll be able to get in 2 years would certainly cost me a lot more if I got them today.

I've also seen situations where the residuals make it much more attractive to lease on a shorter term, for example I'm about to come out of a 21 month lease on a 2007 M45 Sport. At the time I leased it (about a month after the new model came out), the numbers were:

21 month 76% residual 0.00219MF $651/mo
24 month 70% residual 0.00204MF $717/mo
36 month 58% residual 0.00210MF $721/mo
48 month 43% residual 0.00275MF $795/mo

Clearly you can see why I picked the 21 month. But, even if stick to divisible-by-12 number of months (which really guarantees nothing, given the frequency with which they move the release dates on new models around), you probably still aren't going to align with major model overhaul releases. For example, the 2008 M45 that is available to me today is barely an improvement over the 2007, and it doesn't look like the 2009 is going to be any better (not to mention 7 months out thanks to them moving the model release date around). If I had a 39 month lease, maybe I would be in a better position to come out and straight into a 2010 M50. The only other solution is to be prepared to constantly shift models, for example to an FX50 for 2 years, then back to an M50, etc.

There are also tax considerations to deal with. For example, I recently found myself relocated to the great state of Illinois (we call it Ill-Annoy), which rewards you for residency by screwing you on sales tax on the entire price of the vehicle (up-front too, or you can roll it into your financing) even on a leased vehicle. So for example, on a $40k car they tax me 7.25% (would be 6% more if I was in downtown Chicago), or $2900, regardless of the length of the lease. Even if I only lease it for 24 months with a 75% residual, I pay the entire $2900 ($120/mo) not just the depreciated amount. This effectively makes the sales tax in the above example 29%, compared to only paying $74/mo if I extended the tax out over 39 months. And I wondered why there were so many hoopties still on the road here.