Kubota finance dream

[shrekbelly]

i have often admitted, that i'm not the sharpest knife in the drawer . . . would like some clarification reguarding kubota financing.
when i purchased my bx1850 (12/31/07) i took advantage of the 0% for 36 months (yeah-smart move) . . . then added a fel on another sales ticket from same dealer, my out of pocket expense.
deal then goes to 0% for 42 months, i wish i had waited on my entire purchase . . . DARN! oh well.
i now want to to purchase a box blade and/or a tiller (perhaps landpride or befco). am i able to use kcc financing on new, non kubota products at my
local expensive - friendly- kubota dealer? thanks, shrekbelly

 

[swampvol]

I believe they offer Landpride with the 0% financing.

 

[ChexC]

The Kubota Insurance covering Flooding is a nice feature...most home owner insurance does not cover that. When Katrina hit...Kubota Insurance sent out the checks the week they received the claims....the homeowners insurance would not pay and it took the government to step in and four years later the people received a percentage of their checks.

I wish you could buy the insurance after you pay for the unit...that would be nice where you have storms, etc.

 

[arrow]

There is also no such thing as 0% loans in any form. To get 0% you are having to finance thru Kubota in this case but would be the same thing as buying a Ford, Chevy or Chrysler product. To prove my point, ask the dealer what the purchase price would be with a regular loan or cash on that "0%" item. Corporate America will always find creative ways to get that money out of your pocket and make you feel warm and fuzzy about doing so. Whether you pay $2000 more in term financing in interest or $2000 more for the non-negotiable msrp with 0%, they always get the money. All this 0% is about getting you to spend now. One is not saving as much as one thinks.

 

[Charlesaf3]

on kubota there actually is a savings currently. They'd give me $600 for cash, which is nothing compared to the zero percent, which is more like $7k.

Must be an easier way for them to provide the discount, since discounted present values should match up as you say - doesn't make a whole lot of sense.

 

[traderrik]

With all due respect, when it comes to financing Kubota must work differently with their dealers than the auto manufacturers do with theirs.

Having been in the auto business for years, I can tell you that a new car dealer typically makes money when you finance through them, regardless of whether it is a bank they are affiliated with or through the manufacturers' financial entity (GMAC, Ford Motor Credit, Toyota Motor Credit, etc.) They look at this as extra profit. Sure, they always try to get as much as they can from "us" on every sale, but it really doesn't have to do with how one is paying for the vehicle.

The buyers' old line "how much for cash?" is absolutely no incentive to a car dealer to lower the selling price - unless one has flaky credit. In that case, the dealer may have to do what's called "recourse financing" to get the fiancial institution to accept the deal. This means that upon a loan default, he gets the vehicle back and has to make good any loss to the financer. A dealer will normally only participate in recourse financing if he's either making a ton of profit on the sale, the purchaser is making a down payment so large that the dealer would stand to gain if the vehicle was respossessed (i.e. by getting to sell it again from a low cost basis), or else the vehicle is one he really wants to get rid of. (Sorry, didn't mean to get off on a tangent.)

I'm planning to make a deal on a new tractor and cutter this weekend, and, until now, had planned to go with the zero percent financing. I'll be happy to report back if I git 'er done...

 

[arrow]

I'm looking at it this way. I buy the 20 grand item at 0% and I'm told, sorry Mr. Customer, its 0% on msrp so they'll be no further discounts. Lets see now, 42 months on 20 grand = $476 or there abouts per month. Customer B goes in with no 0% incentive and gets to buy the tractor for 10% off or 18000. Finances the whole thing for the same time frame and is paying about $480 per month at a rate of 6.5%. You've paid 20 grand in 42 months, customer B has paid $168 more than you over the similar term. This is what I meant about the savings not being that much. Let's extend it further. You are allowed to wheel and deal at 0%. Your purchase price is 18 grand at 0% or the same as customer B. You will now pay about $429 per month or $2100 less over the loan term than customer B.The invoice on the tractor is 15 grand. (25% profit margin) I was told of this profit margin by a JD sales manager friend of mine. I could be wrong about Kubota thinking they are working with the same profit margin. The hard ball player customer comes in and states , "I'm not paying anymore than 10% over invoice. I'll give you 16.5 for that tractor." Now he's in the exact same place and actually a little less than the above scenario with the same loan terms at 6.5% (Of course if the dealer agrees to sell for those numbers and that will depend on several factors from dealership to dealership) The companies will always make their money. They simply look for clever ways to get you to part with yours and mine.

 

[traderrik]

Again, with respect, auto manufacturers couldn't care less how much a dealer sells a vehicle for. They make their profit on the vehicle itself (financing and extended warranties notwithstanding) when they sell it to the dealer. Actually, they would rather see dealers not be greedy and make better price deals, so they get to manufacture and sell more vehicles!

So there is no such stipulation in that industry, as some have suggested for Kubota, that a vehicle must be retailed at MRSP in order for the purchaser to get low rate financing. And they don't put any special incentives on new vehicles unless the market/economy is really soft, or the particular vehicles are slow sellers - so again, it is their best interest to get the retail sale done!

I suspect it has more to do with the Kubota dealer(s) seeing an opportunity to increase their profit by telling folks that they can't discount the tractor if the purchaser wants to take advantage of the zero percent financing. (I have a buddy who recently got suckered-in with that line by a Chevy dealer; they "took him to the cleaners" on a slow-selling SUV.) That would be typical of any retailer, regardless of the industry, and is the only thing that makes sense to me; but again, I have no experience with Kubota so I could be all wet.

 

[arrow]

Traderrik, most car dealerships as far as incentives go, give you a choice of either the rebate or the low financing with the current soft market notwithstanding where on some cars or trucks you get a little of both. I know the dealerships are regarded lower than a snake belly by the auto companies and the poor saleman lower than that, the big three must care someplace about the selling positions as they relate to money as a result of giving the customer a choice of either or and not both or are you saying these pricing strategies are created by the dealership associations ? In other terms, I can go into Chrysler now and buy a Dodge pu for 7 grand less than msrp if I take the incentives and discounts. I cannot have it discounted that steeply if I take the 0%. When I figured both in the long run, they are not all that separated. It also seems to be a standard policy in at least the three dealerships I've been to of either taking the rebates or low financing. Who is establishing these positions? The dealer or the car companies?

 

[Charlesaf3]

arrow, I just got a great deal - way under MSRP, and zero percent on a new m59. I agree that it is weird, and makes no financial sense, as does the dealer.