Kia Telluride with $5K mark-up: Lease or buy?

[JP10]

Original thread for back-story:

https://g80.bimmerpost.com/forums/sh....php?t=1735980

We went out and test drove the Kia Telluride (EX) and the Hyundai Palisade (Limited). Unfortunately there was a Genesis GV80 that had arrived that day at the Hyundai dealership. It was a mistake to let me fiance in that car because it was beautiful, but out of budget. Anyways, we agreed that we like the Kia Telluride over the Hyundai Palisade.

This is the part where I am having some trouble. The Kia dealership is marking their telluride's up $5,000 because they are flying off the lot. I'm not pissed about it because they are at least upfront when they tell you, but based on the mark-up the question of lease vs buy is swimming through my head. I can go elsewhere and buy one for $41,750 or I can lease the same vehicle in Charleston for $46,750 (yes this does not include taxes, fees, etc). The price differential puts the finance cost more relative to the lease cost (monthly payment). Based on sales I am seeing on Carvana, these Tellurides are barely depreciating right now. I saw an EX model go for $40,000 with 15,000 miles hence it only depreciated $1,750. I can also get a really solid interest rate through buying (1.9%).

So do I spend around $20,000 over the next 3 years for nothing to show for it. Or do I buy, with the option to sell down the road since depreciation is holding steady (as of now). I'd estimate the car would we worth somewhere around the low 30s in 3 yrs with 36,000 miles on it. Estimate would be based on the 1 year depreciation I am currently seeing, depreciation will increase as production continues. First year for the tellurides was 2020 hence there is not a ton of market history. If I bought, I'd do a 60month term with the intention to pay in 36. I could see us keeping the car past three years (another reason why I am debating buying), she is a little more picky in which she would see us upgrading by then.

Any assistance would be appreciated, this is the first new car I will have ever purchased hence why I am concerned about path forward. We are financially stable, but we also have quite a few large expenses in the next couple years (wedding, house purchase, .....kids...... lol). Hard planning so many different things for the future.

[keg97]

Sorry but I find it a hard pass on paying over sticker for a Kia. And I find it hard to believe the Kia will maintain that kind of silly value over the long term. Once the supply meets the demand (and it will), I'd assume the Kia will depreciate like a normal Kia.

A buddy of mine was in a similar situation back in September as yours (final choices- Kia & Hyundai) and went with the Kia. He got it for sticker at dealer in Blacksburg, VA. If you're bent on the Kia- expand out your search and resolve not to pay over MSRP.

I will say, the one time I saw in the Telluride- it was nice and super nice for the price point. The reviews on it are outstanding.

Good luck!

[JP10]

Originally Posted by keg97

Sorry but I find it a hard pass on paying over sticker for a Kia. And I find it hard to believe the Kia will maintain that kind of silly value over the long term. Once the supply meets the demand (and it will), I'd assume the Kia will depreciate like a normal Kia.

A buddy of mine was in a similar situation back in September as yours (final choices- Kia & Hyundai) and went with the Kia. He got it for sticker at dealer in Blacksburg, VA. If you're bent on the Kia- expand out your search and resolve not to pay over MSRP.

I will say, the one time I saw in the Telluride- it was nice and super nice for the price point. The reviews on it are outstanding.

Good luck!

It really is a great bang for your buck vehicle! Found one near MSRP, might pull the trigger sometime this week. Everytime I find one in the spec that she wants it sells.... Painful haha[

[AlexFL]

Originally Posted by JP10

It really is a great bang for your buck vehicle! Found one near MSRP, might pull the trigger sometime this week. Everytime I find one in the spec that she wants it sells.... Painful haha[

Did you also consider the new Sorento? Looks super sharp!

[No Boost]

Friends don't let friends pay ADM.
Just say no to ADM.
This is your brain on ADM. Any questions?

[JP10]

Originally Posted by AlexFL

Did you also consider the new Sorento? Looks super sharp!

I have looked at them briefly, and agree they are pretty sharp! Kia is really coming around. Would consider these, but again we want something larger then her current vehicle. And if you compare the two, you can get a lot more for a relatively similar price for the telluride.

Not sure why this portion of the thread was broken into a separate thread, but that is what it is.

[AlexFL]

Originally Posted by JP10

I have looked at them briefly, and agree they are pretty sharp! Kia is really coming around. Would consider these, but again we want something larger then her current vehicle. And if you compare the two, you can get a lot more for a relatively similar price for the telluride.

Not sure why this portion of the thread was broken into a separate thread, but that is what it is.

Sorento is a much bigger vehicle than her CX-5 but I do get your point regarding the Telluride. A really great SUV!

[stein_325i]

Good SUV, but try to aim for MSRP. There are only few vehicles in the world that I would actually buy with ADM's, but a mass-market sold 3-row SUV is not one of them.

[David70]

You have two separate decisions to make. First is if you want to lease or buy and then you need to figure out what the market price of this vehicle actually is (how low you can get it for) and then decide if this price is ok with you. If you have decided that this is the vehicle you want then the only decision is lease vs. buy and negotiating the lowest deal.

When you say the Charleston dealers price is $46k, but you can go somewhere else and get it for $41k, why are you still trying to deal with the Charleston dealer? The purchase AND lease will also go down if you can negotiate a better starting price. Leases are a calculation and as the inputs change the monthly payment also changes. I would drive a considerable distance to save $5k.

For the question of lease vs. buy, do you typically replace your new car after 3 years regardless of how you got it?

[JP10]

Originally Posted by stein_325i

Good SUV, but try to aim for MSRP. There are only few vehicles in the world that I would actually buy with ADM's, but a mass-market sold 3-row SUV is not one of them.

I agree, and the last thing I want to do is pay over MSRP. With that said, even marked up like they are around Charleston, they are still flying off the lot. Last model that was optioned how she wanted it sold prior to getting to the lot. Optiones are limited, but I found the one she wants in Charlotte. Waiting to see how the numbers will play out, I want them to provide out the door cost before I make the trip. For the record there is another dealer within 200 miles of here that is marking their Telluride's up $9,000 (regardless of the trim). It is absurd!

Originally Posted by David70

You have two separate decisions to make. First is if you want to lease or buy and then you need to figure out what the market price of this car actually is (how low you can get it for) and then compare it to something similar from another manufacturer. If you have decided that this is the vehicle you want then the only decision is lease vs. buy and negotiating the lowest deal.

When you say the Charleston dealers price is $46k, but you can go somewhere else and get it for $41k, why are you still trying to deal with the Charleston dealer? The purchase AND lease will also go down if you can negotiate a better starting price. Leases are a calculation and as the inputs change the monthly payment also changes. I would drive a considerable distance to save $5k.

For the question of lease vs. buy, do you typically replace your new car after 3 years regardless of how you got it?

The lowest I have found the vehicle with all of the options is $41,770. This is MSRP, no dealer mark-up. The dealer in PA is not marking up FWD Tellurides, but is marking up the AWD. Different weather conditions up there obviously. I have nixed the Charleston dealer, as you mentioned it is ridiculous to pay that mark-up. I found one in which the dealer told me $43,800. That dealer is located 3hrs away. That is now $2,000 over the price in PA. The saying time is money does factor for me, and there is also cost in getting up there. Fiance would want to come, so 2 flights would be around $300-$400. Gas on the return trip from PA would be around $100. Then 10hrs of my time on the return home. Hence I am debating the $43,800 price at this time.

In regards to lease vs buy, we agreed last night that buying would be more beneficial to us. I don't want to be handicapped by miles like we were on the last lease, this was quite annoying and limited us from taking shorter trips due to the concern. If I buy I could see us paying it off early, then having the option to upgrade. With the upcoming large expenses in our life it could also be a good 5yr+ vehicle for us. Seems like the better long term decision as well as potential solid short term decision dependent on depreciation over the next few years. Buying shouldn't put any financial strain on us as I will be paying my car off within the next 2 weeks.

[SteveinArizona]

I will not pay over MSRP...ever. I don't drive the hardest bargain when I purchase a car but want a deal that is fair to me and the same applies to a hot car. If a dealership tells me that it wants more than msrp, and won't deviate from that position, then I will never shop at or bring my car to that dealership ever again.

Of course, I live in a big city and have lots of options. That might be harder in a rural area.

[JP10]

Originally Posted by SteveinArizona

I will not pay over MSRP...ever. I don't drive the hardest bargain when I purchase a car but want a deal that is fair to me and the same applies to a hot car. If a dealership tells me that it wants more than msrp, and won't deviate from that position, then I will never shop at or bring my car to that dealership ever again.

Of course, I live in a big city and have lots of options. That might be harder in a rural area.

I have checked within 200 miles of Charleston. Only one dealer had prices within $500 of MSRP. It will pain me to pay over MSRP, with that said our lease is over miles (400miles so far). That will continue to rise until we get something, at $0.25/mile overage it would be ideal to find a replacement sooner rather then later haha.

[David70]

Originally Posted by JP10

The lowest I have found the vehicle with all of the options is $41,770. This is MSRP, no dealer mark-up. The dealer in PA is not marking up FWD Tellurides, but is marking up the AWD. Different weather conditions up there obviously. I have nixed the Charleston dealer, as you mentioned it is ridiculous to pay that mark-up. I found one in which the dealer told me $43,800. That dealer is located 3hrs away. That is now $2,000 over the price in PA. The saying time is money does factor for me, and there is also cost in getting up there. Fiance would want to come, so 2 flights would be around $300-$400. Gas on the return trip from PA would be around $100. Then 10hrs of my time on the return home. Hence I am debating the $43,800 price at this time.

In regards to lease vs buy, we agreed last night that buying would be more beneficial to us. I don't want to be handicapped by miles like we were on the last lease, this was quite annoying and limited us from taking shorter trips due to the concern. If I buy I could see us paying it off early, then having the option to upgrade. With the upcoming large expenses in our life it could also be a good 5yr+ vehicle for us. Seems like the better long term decision as well as potential solid short term decision dependent on depreciation over the next few years. Buying shouldn't put any financial strain on us as I will be paying my car off within the next 2 weeks.

I live in Cincinnati and my last 3 cars have come from Savannah, GA (flight-drive), Boston (flight-drive) and Phoenix (friend looked at it and they shipped it, never saw it until it got off truck).

With all of mine being used it wasn't nearly as easy to cross shop but the travel vs. buying more local is a question both for money and time, as you said. First thing I would do would be to tell the $43,800 person that you are debating a much lower price somewhere else that comes with travel or buying from him for a lot more money. If he would drop his price by $1k, you would buy it from him now. Worst case is he says no, best case is this would solve your problem and be close enough that it wouldn't be worth the trip to PA.

EDIT - Also add that the fly/drive back likely comes with additional costs/problems. Getting from Charleston to PA, buying the car and then driving back for 10 hours likely comes with a hotel and taking up 2 days, not 1. My wife never wanted to be part of any of these trips as reality is they aren't any fun. You have to figure out how to get from the airport to the dealership, then have to pick up your car at the airport or get someone to drive you there. Make sure you get all paperwork that you will sign before making any trip so you don't end up at the dealership and find out there are unexpected fees getting added to the invoice. Once there they know you will sign anything as you have no good options for leaving.

[dgoldenz]

If you can get it for $5k less from another dealer, why not just lease from them? Fly in and drive home or get it shipped for $600-1200 or so.

[GOLFFRR]

mark up on a kia?? I thought the whole reason to get a kia was to save money. I guess supply/demand works in all areas

[BEM-S4]

There's a reason Kia dealers refer to these as "Sell-Your-Rides" they are gone as soon as they hit the lot.

[JP10]

Yeah the Telluride in Charlotte sold. Back to the drawing board. Now considering the one in PA more. Going to browse the VA area a little bit because I recall seeing an AWD EX model that was priced very closely to the FWD model. I dont need AWD, but if I buy I'd prefer it just for resale value.

[SteveinArizona]

to me, its a matter of principle. I recently cancelled my cable tv service because a repair person cancelled a service call on me because he didn't want to bother and the company would only reschedule. Two days later I had DISH.

I would rather buy a different vehicle from a different manufacturer then pay over MSRP.

It isn't the money; it is how I am treated by a seller.

[BigHunk]

Kia over msrp.......unbeliavable, just lease car online with some other dealership. Let the dealer care the transport for you. They can arrange dealer transfer etc.
Kia is brand with steep depreciation, so whatever you pay over msrp is burned money. Lease is the best choice in your case.

[MmmmmM2]

Don't do it because you will always be in the hole in resale value.

[JP10]

Appreciate all of the comments. I'm looking at one at MSRP in PA. If I can find one near by I'd pay an extra $1000-$1500 over MSRP for convenience (I'll have near that cost in getting the car in PA). Still more interested in buying then leasing. Worst case it does depreciate a solid bit, but at the end of the day IMO it is one of the better bang for your buck brand new 3-row SUVs out there. And again mileage is something to consider. If i were to do a 3yr 15000miles/yr lease the price would be almost comparable to the finance cost at 1.9& APR.

Also, if we were to lease that means after 3yrs my fiance would need a new car. I'd have a better chance of hell freezing over then her downgrading from there. Hence after 3yrs I would be looking at a larger car payment if leased, where as buying I could fend her off for a little while lol!

Another update, a different dealer in charleston just restocked 10 of them today. Already 3 sold. Two available in the spec we want, and they are marking them up $5k just like the other dealer in this area. Not even entertaining that.

[Smgs1992]

Would never pay over sticker for a Kia. Too many other vehicles i would rather spend my money on