I have been remiss in reporting on our family vehicles. Back in 2019 I wrote about Gabriele getting an X5. It was a nice car, but when the pandemic hit we sold it after the warranty expired. We didn’t want to be on the hook for expensive repairs, and we got a high offer for the car from the online retailer Vroom.
In 2021 we leased a Mazda CX-9 and it served us well for three years. Gabriele wanted something different this time and narrowed the choice down to the Hyundai Palisade or the Kia Telluride. Hyundai owns Kia, and these two share the same engine and powertrains. Whichever we could get the best deal on would be the winner.
There are three factors to know going into a lease – the residual, the money factor, and the best price you can negotiate. Edmunds has a forum that will let you know the residual, MF, and any promotional dollars for a car you’re interested in, based on trim levels and your location. There was a big difference in the MF between the two cars. The Telluride was .00264 (6.33%) while the Palisade was .00141 (3.38%). So for two identically priced cars we’d have to pay thousands more in interest for a Telluride. The Telluride had a slightly higher residual – 71% vs. 66% for the Palisade – but that didn’t come close to offsetting the finance cost.
Trim level was important because Gabriele wanted all the latest features in the car – 360 camera, blind spot monitoring, ventilated/heated seats, etc. There was a premium package that could be added to the SEL trim level that delivered all these goodies. That’s the car we zeroed in on. I used Edmunds to compare prices, knowing this would provide my contact information to local dealers. I wanted to give our business to a dealer who would share real information and negotiate over email with me.
It’s amazing how resistant to change the retail car business continues to be. Almost no one would communicate without talking on the phone. A lot of salespeople pursued via email and text, but wouldn’t share anything valuable. When I emailed one salesperson back and asked him to confirm the residual and MF he said “that’s out of my pay grade.” Well then why should I let you waste my time? (I thought that, no need to email it.)
The only dealership that did make a serious offer via email was Sheehy Hyundai of Waldorf. Sales manager Steve sent over numbers that looked competitive and we drove out last Saturday. Gabriele liked the car and we pulled the trigger. Completing the process still took too long but there was no need for haggling.
The Edmunds Price Checker said we did pretty well. Leasing in Maryland saves on the dealer document charge – $500 vs. $899 in Virginia. (The finance manager told us that the Maryland fee is going to $700 soon.) I wasn’t a math major so I had plenty of questions as we went over the contract. We are lowering our monthly payment by almost $50 and total costs by around $2,000 compared to the Mazda, which isn’t bad considering inflation and the cost of money today.
A new car lease works for us because Gabriele gets a brand-new car every three years with full warranty protection. All the car should need is oil and filter changes, allowing me to focus maintenance time on my M cars. We’ll see how many dealers are willing to negotiate electronically when we go through this again in 2027.
If you’re considering leasing I hope this information is helpful. Happy Memorial Day.