What's The Price?

HI Everyone,

In this hotly contested presidential candidate race, every day there is another opportunity to prove that politicians have no common sense at all. But I will take a repose from politics this week.

Each and every one of us at some point in our lives will need to buy or lease a car or two or three or more. Since car prices are through the roof and in a lot of cases, cost about as much as a small house, it never ceases to amaze me the advertising tactics used by car dealers. Today's blog is about an ad that I recently read in my Gannet newspaper. Let's see if you can figure out exactly how much this car will cost.

The ad is for leasing any of 7 different Hyundai cars. In big letters it boldly states: $0 downpayment, $0 1st month's payment, $0 security deposit and $0 bank fee. The bottom line is that you don't need any money what so ever to get a new car for at least 30 days or until your quote, second monthly payment is due. The monthly lease cost goes from $159 to $277. So far this seems that this might be a good deal, if of course you are interested in a Hyundai, right? But is it? After the monthly cost is the all important little asterick. Then at the bottom of the page is the very small type face "fine" print that applies to the asterick. The fine print states the following: "Closed end leases based on 0 miles/year. Customer picks additional mile/year option from chart based on need (min. 12k mi/yr)". The chart is at the top third of the page and it shows two options: 12,000 miles/yr = 8 cents per mile and 15,000 miles/yr = 8 cents per mile. So the $64,000 question is how much would your monthly lease payments be? Under the 12,000 mile/yr plan you would have to multiply by .08 cents which equals $960 per year. Then divide $960 by 12 months and that would equal an additional $80/month. The 15,000 miles per year option would equal to an additional $100/month.

Based on the above math, the least expensive model isn't what is stated in the ad as $159/month, but would actually cost either $239/month for 12k/yr or $259/month for 15k/yr. I wonder how many people actually went to this particular dealer expecting to pay $159/month? I also wonder what people, (but not just any people, but perspective customers) would say and think upon being told that the actual monthly price would be either $239 or $259/month plus tax? I can't say that the ad is inaccurate, because the fine print details the additional costs. But isn't the ad really misleading and deceptive and written to increase traffic into their showroom? This dealer has no intention of leasing any of their cars for the advertised prices, which may or may not confuse customers. In my opinion, just advertise the car for $239/month for 12k/yr or $259/month for 15k/yr. Wouldn't that make more common sense then a confusing ad? You so have to read all of the fine print so you can understand what the actual monthly payment will be.

Til next week.

Peter