cymro

Hi all,

This forum has been very helpful to me (particularly Wendy aka "Itswindee"), so I though I would share my lease end buy out experience on my 2007 CLS63.

I first spoke with MB Finance twice: a couple of month before lease end, and a couple of weeks before lease end. On both occasions they said lease end buyouts were non-negotiable. This was puzzling because some forum members have said that they received good offers from MBF. It was also puzzling because of the enormous room MBF had to negotiate with given the difference between auction price and residual.

Then I established up to date auction prices as of Jan 4 2008 with Wendy's help (see https://mbworld.org/forums/c-class-w...6-manheim.html).

For my '07 CLS63 in December 08 the auction prices were in the range $38.75k to $46.6k. This was an astonishing amount less than my lease end residual of $70k.

So, I made an appointment with the dealer to return the vehicle on Jan 6.

I let the dealer fill in all the paper work relating to terminating the lease. Not once did he ask if I wanted to buy the car. After the paperwork was done and signed, I told the dealer that I was aware of auction pricing. At first he would not believe the numbers I threw at him, but as soon as I mentioned having seen actual Manheim numbers he realized that I really did know the score.

I then asked him why would MBF not negotiate with me since they could certainly get more from me than from the auction. He said that MBF used to negotiate with buyers, but as a result of the relatively favorable buy out prices for the lessee, the dealers were losing business from consumers who would buy a new car rather than pay an inflated residual, and that dealers had therefore pressured MBF not to negotiate directly with consumers.

He explained that after the lease was closed out, if I wanted to buy the car he would call MBF and then make me a buy out offer. He was confident that it would be less than the residual. This way, MBF makes more than from an auction, the dealer marks it up and makes a very efficient sale - no flooring costs etc., and I get a lower buy out price - a win-win-win situation.

I don't know if you would get the same story from another dealer, but it did make sense.

As it turns out, I didn't want to buy the car at lease end anyway, so I didn't ask him to call MBF and make me an offer.

But, I now know what do do when I wish to purchase my other MBZ at end of lease - go to the dealer and get him to make me an offer, but be prepared to walk away if I don't like the offer.

Thanks again to all posters, especially Wendy ("Itswindee").

krown

Thanks for the info. Did you end up re-leasing another MB? The reason why I ask is that MBF may be left out losing alot of cash because many people may not know about this new practice. I was always under the impression that MBF could renegotiate the residual, and if I didn't read this post, I would assume they didn't want my business and look at other brands.

sosh

Am just going thru this with MB Financial at this time on my 05 E320 4M. I wanted to extend the lease a year to allow me to order a new W212 to my spec. They will extend the lease but only at the existing lease price with no consideration for the lower value or the fact that I did not need to have any additional miles included. They did offer me about 1500 off of the residual to purchase the car but thats still way high. I have never heard of the dealers getting involved in the purchase option as stated here. Believe that is not entirely true and that the poster received a bunch of BS from his dealer. I did not ask MB Financial to do anything they have not done for me before. I was told that their policy's as so far as renegotiating lease prices and deep discounts on the purchases ened in May of 08. They also reiterated that they are insured against losses from depreciation by MB, the parent company. I found them totally inflexable. Never have experienced this with them before and this E is the 6th vehicle I have leased from them since 1998 I will in the future continue to lease my company vehicles however I will look hard for a new source. MB Financial has forgotten their primary purpose in life is to assist and promote the purchase and leasing of MB products.

krown

If this is indeed the case, I think MB will have to look long and hard into this practice as given the current economic climate, they will left be left with a boatload of vehicles that they will be forced to auction off, or deeply discount as pre-owned inventory. I suppose they can gamble the the lessee will eventually end up re-leasing a new MB at more favourable terms, but what are the guarantees of that with other manufacturers offering crazy incentives. I think they're betting heavily on brand loyalty.

sosh

There is a lot of brand loyalty to MB in spite of their attitude and actions. I for one am quite loyal. I like their cars lots. However my loyalty to MB Financial is about over. Next time around I will either look to another leasing source or write the dealer a check for my purchase. You have got to remember that MB Financial has one purpose in life and that is to provide economic incentives for customers to purchase or lease MB products. They are not fulfilling their obligation to their parent company. They like to state that they are an independent organization owned by "shareholders" which they are. What they do not tell you is that the shareholder is MB. MB Financial usually has the best lease deals however there is more to the lease game than just lease cost. Their "First Class Finish" is not so first class. More like steerage.

scottamc

Sosh, you said mbf will allow you to extend a lease for a year at the same rate... Are you sure? I have a c230 07' where my lease ends in March. I took it over 10 months ago on a lease assumption for $299+tax= 323 p/m . I get a call from mbf today saying that if I want to extend my lease for 12 months the payment would be $465 inc tax... !?! He said I had some crazy low payment and he couldn't keep it the same.

Any thoughts by you guys?

sosh

Yes I am certain and I just received the extension contract fed ex this morning. I had heard of some contracts that were at unrealistic low rates due to special promotions where they wanted an increase in the payment. Guess yours is one of them. Don't believe you can negotiate a change with them. They have become very rigid and inflexable. This is likely due to the decrease in value of our cars in recent months. They have me boxed in as there are no cars to our desired spec in the country or scheduled to be built and they are not accepting any orders. I will extend my contract and order a new 2010 W212 to my spec. I am not happy about this but as opposed to their reducing the payment say 200 bucks a month as they had done in the past for me it will only cost me 2400 bucks additional. Its the principle of the thing that I do not like one bit.

cymro

Known:
No, I did not lease another Benz. We no longer need two cars.

cymro

Update:

FYI, I bought my 2007 S65 at lease end.

Auction prices for 2007 S65s in the last two weeks prior to lease termination ranged from $80k (hi mileage, below ave.) to $94k (12k miles, above ave.)

My residual was $111k and my mileage was 11k miles.

Armed with auction prices kindly supplied by forum members, I bought it for $92k thru' the dealer.

MB finance would not budge at all from the residual.