0% financing ?

[Georgia_Y]

Most car manufacturers are in a volume game and try to sell as many uses as possible. Tesla is supply limited right now and don't have vehicles sitting on the lot. For others, the inventory itself is the responsibility of the dealers which take on loans to hold the inventory. Therefore, 0% apr is just another tool to get the units out and a back channel incentive. If dealers didn't exist, I doubt 0% apr would be as popular since everyone would be building just enough supply to meet demand.

 

[M3BlueGeorgia]

Most dealership would rather you finance with them since they get additional payout for that from the bank. So I doubt them will give you a better price if you don't finance from them. Not sure about 0%, but i know that when I negotiated my previous ICE cars, they always wanted to make sure I finance with them before promising me for a better price.

Also, 2% on $50000 loan is $2500 interest over 5 years, so i will take 0% any day. It's a misconception that dealership like cash buyer, they actually will reluctant to give you a better price if you don't finance since they make extra of that. if you are a cash buyer, always wait until after you finish negotiating then tell them you are paying cash.

Yes, they don't usually like cash buyers, but right now they like any buyer

 

[Darmie]

Jaguar I-Pace I believe just started 0%..

ranger aside, its a nice option

It amazes me that the manufactures and dealers must resort to these measures. Why can't the so called Tesla killers be sold on their Merits

 

[M3BlueGeorgia]

Most car manufacturers are in a volume game and try to sell as many uses as possible. Tesla is supply limited right now and don't have vehicles sitting on the lot. For others, the inventory itself is the responsibility of the dealers which take on loans to hold the inventory. Therefore, 0% apr is just another tool to get the units out and a back channel incentive. If dealers didn't exist, I doubt 0% apr would be as popular since everyone would be building just enough supply to meet demand.

Legacy automobile manufacturers have a mutually parasitic relationship with their dealers. I was going to say symbiotic, but I think mutually parasitic is more accurate.

When the manufacturer makes a vehicle, they count it as revenue the moment it ships off their facility. This maintains their revenue on slow times of the year, such as Q1, but means the dealers are carrying heavy inventories, which has to be financed, and the dealers use their relationship with the manufacturers to ensure these vehicles are financed.

If dealer inventories get too big, the dealers start to balk about getting new vehicles, so the manufacturers have to run promotions to shift this inventory. Dealers are effectively subsidized to hold inventory off the manufacturer's books, sometimes actually subsidized.

COVID-19 came at the worse possible time for dealers and for legacy manufacturers. The dealer lots are full of vehicles built in Q4-19 and Q1-20, expecting a big Spring sales season, which isn't happening. And because the dealer lots are full and sales are low, they have very limited ability to take more new inventory, so there's not much point the Ford, or GM, etc opening up factories because, except for a small number of hot product lines, dealers don't want the production and their banks aren't willing to finance vehicles to sit parked in the hot sun for many months.

 

[JK20]

Got my MY PUP ($70k) 0 down (taxes only) for 72 months with Tesla for 2.64% by Chase. This rate conversation is kind of silly- between 2.64 and 1.64% (just for the sake of argument) you have about $30 a month!

 

[Jubess]

Got my MY PUP ($70k) 0 down (taxes only) for 72 months with Tesla for 2.64% by Chase. This rate conversation is kind of silly- between 2.64 and 1.64% (just for the sake of argument) you have about $30 a month!

All things being equal I'll take the 1.64% and save about $2000 over the life of the loan.